AngloGold battles Tanzanian laws
Subsidiaries turn to arbitration after government passes new legislation to ensure state profits
AngloGold Ashanti’s subsidiaries in Tanzania have initiated arbitration proceedings to protect their interests in case the government changes the terms of their longstanding agreement, the group said on Thursday. Tanzania’s government recently passed three new laws to ensure the state earns a greater share of mining, oil and gas profits, after a dispute with London-listed Acacia Mining over gold sales. The new laws allow the government to renegotiate mine development agreements, take up to 16% free carried interest in all mining projects and raise royalties to 6% from 4%. It also wants to compel companies to do more local beneficiation. The shares of Australian-listed mining companies operating in Tanzania were hit by the news. Some development companies such as Volt Resources and Graphex Mining said the new laws would not stop them from continuing with projects. AngloGold’s Geita gold mine produced 489,000 ounces in 2016, about 14% of total group production. AngloGold said it origi...
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