Acacia says committee’s findings on its Tanzanian gold exports inaccurate

JOHANNESBURG (miningweekly.com) – Tanzania-focused Acacia Mining on Friday said it could not agree with the findings of a report, compiled by a Presidential committee tasked with investigating the export of gold and copper concentrates.

President John Magufuli on Wednesday released the findings of the report and announced that the directive halting the export of gold and copper concentrates would remain in place. He also fired Mining Minister Sospeter Muhongo and another government official over the committee’s findings that mining companies were under-declaring the value of their exports.

The committee had also found that Acacia had not fully declared all minerals contained in concentrate.

Although it has not yet received a copy of the full report, Acacia on Friday said it had analysed the summary findings published.

The miner said that, based on more than 20 years of data, it could not reconcile these with the findings of the committee. “This historical data has been compiled and analysed by Tanzanian and international experts and organisations, with consistent results . . . and has consistently shown the gold content of the concentrates is less than one tenth of the committee’s findings,” Acacia pointed out.

Further, it stated that if the committee’s published findings were based on accurate data, the Bulyanhulu and Buzwagi mines would be the world’s two largest gold producers.

“Given the magnitude of this discrepancy, we believe there should be an independent review of the content of the concentrates.”

Acacia’s verified data shows that the 277 containers at Dar es Salaam port contain 26 000 oz of gold in total.  Each of these containers contain, on average, around 3 kg, or 100 oz, of gold, 3 kg of silver and 3 000 kg of copper. 

“The committee’s findings were that the gold content of these containers, which represent one month’s production, totalled 7.8 t, or 250 000 oz. In 2016, Acacia produced and sold 250 000 oz of gold in concentrate from these two mines in the whole of the year,” the miner argued.

The committee’s findings also implied that Bulyanhulu and Buzwagi each produce more than 1.5-million ounces of gold a year, placing the mines as the two largest gold producers in the world and Acacia as the world’s third-largest gold producer.

Its findings further implied that Acacia produced more gold from just three mines than produced by companies like AngloGold Ashanti from 19 mines, Goldcorp from 11 mines and Kinross from its nine mines.

Meanwhile, Acacia pointed out that, as a listed public company with hundreds of shareholders, its financial, production and gold reserve records were audited to international standards by many independent auditors, and must comply with government oversight agencies in Tanzania, the UK, Canada and the US.

“It would not be possible for Acacia to under-report our gold reserves, our gold production and our revenues even for a short period of time, let alone over many years. We do not understand how the committee could reach these findings without consulting with these independent auditors and regulatory agencies,” it stated.

It added that, if the committee’s findings were accurate, and Buzwagi produced and sold ten times more gold than it declares, Acacia would be extending mining at Buzwagi for many years.

“The reality is that Buzwagi is a low-grade mine and is running out of commercially viable gold.”