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Tanzania accused of signing premature new gold mining agreement with Barrick

by Frank JomoMineweb

The Tanzanian Government  has come under heavy criticism from a Member of Parliament from the opposition Chama cha Demokrasia na Maendeleo (Chadema) party Zitto Kabwe for signing a new mining agreement with the world's largest gold mining company - Barrick Gold Corp. whilst the government was still reviewing all mining contracts.

Speaking during a budget session of Parliament Kabwe said the Energy and Minerals Minister also owes the nation an explanation as to why the agreement had to be signed in London and not Dar-es-Salaam and contrary to President Jakaya Kikwete's assurance that the country would review mining contracts before others are issued.

The Tanzanian government has been holding meetings with mining companies to review mining contracts following accusations that the contracts were benefiting mining companies and not the country.  While Tanzania has been praised as having good mining incentives which have been making the country attractive to mining companies, the government is accused of doing too little to ensure that the people also benefit equally from the mineral wealth.

Kabwe also told the House that the Kikwete government had had a 15 percent stake in the Bulyanhulu Mine, which has 11.2 million ounces of proven and probable gold reserves but later sold the stake for a song.

"The government must explain why it sold the shares at a low price," he said while advising government not to allow a single company monopolise its booming mining industry.

Barrick Gold is the country's largest mining company owning four of the country's nine major mines. In total Barrick Gold owns properties in Tanzania with combined proven and probable reserves of about 17.4 million ounces of gold.


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