Acacia Accused of Under-reporting Mineral Exports
“The committee [investigating the exports] found that there were many other minerals in those shipping containers that were not declared, such as sulfur, iron, iridium, titanium and zinc,” Magufuli said, according to CNBC Africa. “They were also under-invoicing the actual gold, copper and silver content in those shipping containers.”
Magufuli said the report showed Acacia declared 1.1 metric tons (mt) of gold shipped, while the audit revealed as much as 15 mt had been prepared for export. He added that samples from more than 250 containers of concentrate had been tested. The report will be a blow for the company that has worked hard to rebuild a tarnished image in the country. Formerly African Barrick Gold (ABR), Acacia changed its name in 2014 in part to rebuild its brand as a separate entity to then major shareholder, Canada’s Barrick.
In 2013, industry veteran Brad Gordon was brought in as CEO. While operating as ABR, the miner had struggled to maintain relations with both the authorities and local communities. Clashes between police and illegal miners trespassing on ABR’s property left several people dead, drawing the ire of human rights groups. Since his appointment Gordon has prioritized repairing the company’s shattered reputation and standing with locals, particularly in the North Mara district. “We’ve done a lot of work to change perceptions and our relationship with the North Mara community,” Gordon told the Mining Indaba in Cape Town earlier this year.
In March this year, though, the government banned the export of unprocessed minerals and ores. The issue of the under- declaration of exports to evade royalty payment has been a longstanding complaint of regional governments. Acacia has three gold mines in Tanzania that also export quantities of copper. The company has continued with production, but the loss in sales is reportedly costing up to $1 million a day in revenue. Acacia had also been in talks with Africa-focused Endeavour to merge and create a potentially $3 billion company. However, following the ban, Canadian- listed Endeavour ended talks.
There is some market speculation that the ban is an attempt to pressure Acacia and other producers to process their ore in Tanzania. Mines though have said this would be costly, particularly as they would likely have to provide their own power supply. Acacia meanwhile released a statement saying it fully declares all its exports.
“Acacia has not yet seen a full copy of the report, which states that the value of minerals within the concentrates in the containers currently at the Dar es Salaam port is more than 10 times the declared amount,” the company said. “We are seeking a full copy of the report and further clarification. Acacia reiterates that it fully declares everything of commercial value that we produce and pay all appropriate royalties and taxes on all of the payable minerals that we produce.”