Picture: BLOOMBERG/TREVOR SNAPP
Picture: BLOOMBERG/TREVOR SNAPP

Toronto — Executives at Barrick Gold and Glencore expect to receive a new licence for their Kabanga nickel joint venture in Tanzania, having held "productive" talks with the government during the past several months, Barrick said on Sunday.

Under changes to Tanzania’s mining licence structure, put into place in January, Barrick and Glencore have applied for a prospecting licence to replace the retention licence they previously held on the undeveloped project.

The retention licence was due to expire in 2019, and the new licence would be good for four years, Barrick spokesman Andy Lloyd said.

"Glencore and Barrick expect to receive a prospecting licence and look forward to continuing the constructive relationship that exists with both the government of Tanzania, and the communities in the area of the project," Lloyd said.

Reuters reported earlier that Tanzania had revoked a retention licence for the Kabanga nickel asset, as well as 10 other retention licences for nickel, gold, silver, copper and rare-earth exploration companies.

Retention licences act as placeholders for mining companies that want to hold the rights to a deposit, even if they are not planning to immediately develop it.

Under President John Magufuli, Tanzania has been overhauling its mining regulations in an effort to reap greater economic benefits.

Barrick’s majority-owned Acacia Mining has been hit hard by the changes — which included a $190bn tax bill — and has said it would consider selling a stake in some, or all, of its gold mines in Tanzania.

Last month, Acacia said first-quarter gold production fell 55%.

Other African countries are also seeking to redraw historic mining agreements.

Last week, Toronto’s Kinross Gold became the latest miner to be hit by the possibility of regulatory changes in Ghana and Mauritania.

Earlier this year, Vancouver-based First Quantum Minerals was slapped with a $7.9bn tax assessment by Zambia.

Glencore has been dealing with a dispute over a new mining code in the Democratic Republic of Congo.

Bloomberg