Acacia soars as owner Barrick agrees to repay Tanzanian government over concentrate row

Shares in Acacia Mining PLC (LON:ACA) soared on Wednesday afternoon after the gold miner’s majority shareholder stepped in to help settle a dispute with the Tanzanian government.

New York-listed Barrick Gold Corp (NYSE:ABX) has agreed to compensate the East African country’s government, after ministers accused Acacia of under-declaring its gold shipments and “mining illegally”.

Acacia ‘strongly refuted’ the allegations, but after formal talks with Barrick – which owns a 63.9% stake in the gold miner – President John Magufuli said the parent company had “repented” and would “repay all the losses that we as a country incurred”.

Acacia is yet to comment directly.

Row costing Acacia US$1mln a month

The row started back in March when Tanzania banned Acacia from exporting gold/ copper concentrate from its two mines in the country.

That decision came about after a presidential inquiry accused the miner of under-declaring the amount of gold in its export containers.

After a second inquiry which was published on Monday (12 June), the government also alleged that the FTSE 250-listed company was not properly licensed to operate in the country.

Acacia investors were obviously relieved that the issue, which has been costing the company around US$1mln a month, looks to have finally been resolved.

Shares were up 8.1% to 294.5p.

Story by ProactiveInvestors