The
announcement by Acacia comes as President John Magufuli on Thursday
ordered an investigation into thousands of containers of gold and copper
concentrate to establish the actual content of the consignment.
The president instructed the Inspector General of Police (IGP),
Ernest Mangu, to keep under 24-hour police watch some 20 containers
containing gold and copper concentrate that have been impounded at the
Dar es Salaam port.
The president also ordered the IGP to ensure all containers containing gold and copper concentrate at the mines are put under police watch until the contents are analysed by the government. Meanwhile, Acacia Mining, which owns three gold-producing mines in Tanzania - Bulyanhulu, Buzwagi and North Mara - said yesterday that its revenues have been hit hard by the ongoing export ban on mineral concentrate.
"At Bulyanhulu and Buzwagi, the combined direct impact of the current directive is the average daily loss of revenues of more than $1 million per day," Acacia said in a statement.
"Since the (ban) announcement, we have been engaging with key government officials and other stakeholders in an attempt to have the directive lifted.
To date there has not yet been a change in the situation." Analysts have warned that thousands of jobs and billions of shillings in government tax revenue could be at risk due to the financial crisis facing the gold mines after the export ban.
Acacia said it has offered to support and partner with the Tanzanian government in a new study by third party experts to assess the economic potential of building of a smelter in Tanzania capable of processing the concentrate in the country.
A previous study by the state-run Tanzania Minerals Audit Agency (TMAA) concluded in 2011 that building a gold/copper concentrate in Tanzania at a cost of up to $800 million was economically unviable since the country produces less than half of the 150,000 tonnes of ore per annum required to make a smelter operate profitably.
Acacia said since the March 3 ban was enforced, it has been compelled to take a range of actions to help manage this financial impact, whilst ensuring it continues to safely operate the affected Bulyanhulu and Buzwagi mines.
"The mines are continuing to operate as normal and as a minimum have sufficient capacity to be able to place gold/copper concentrate into containers on site beyond the end of April," it said.
"However, prior to reaching this point, during April we will reassess how long we can continue to produce as normal if the ban remains in place and what other measures may be necessary."
Acacia said it would continue to engage with relevant authorities in Tanzania with a view to resolving the current stoppage of the export of gold/copper concentrate and other related issues as soon as possible.
Tanzania is Africa's fourth-largest gold producer and Acacia its largest miner. Like other African nations, Tanzania is on a drive to add value to its exports rather than send raw materials abroad.
Acacia said its mines continue to operate as normal currently but added that it will reassess how long it can continue to produce as normal if the ban remains in place.
The Bulyanhulu and Buzwagi mines, which are located in Shinyanga Region, earn 50 per cent of their revenues from the export of gold/copper concentrates, which are sent for smelting abroad to extract gold, copper, silver and other minerals.
The miner said it has been forced to take several cost-cutting measures after the ban, including "a freeze on the hiring of new employees, restrictions on overtime, postponement of non-essential training and the suspension of some of our capital and non-operational projects."
Acacia chief executive officer Brad Gordon said earlier this month the company was unsettled by the ban, but expressed optimism that ongoing talks with senior Tanzanian government officials would reach a resolution in the "near future."
Acacia Mining's shares fell as much as 19 per cent at the London Stock Exchange (LSE) on March 3 after the company said it had stopped gold and copper concentrate exports from Tanzania following a ban ordered by President Magufuli.
President Magufuli has publicly raised concern of possible funny deals involving exports of gold/copper concentrate and even questioned the presence of airstrips at large scale gold mines as a possible source of government revenue loss from undeclared gold exports.
However, the TMAA report said "most of the copper concentrate producers in the world similar to that produced in Tanzania do not have their own smelters, but rather they export their concentrates mainly to China and Japan for smelting and refining."
"A commercially viable copper concentrate smelter requires a feedstock of not less than 150,000 tonnes per year. At full capacity, BGM (Bulyanhulu) and BZGM (Buzwagi) can produce 60,000 tonnes of copper concentrate annually, which would only account for 40 per cent of the capacity of a viable copper smelter," said TMAA. TMAA insisted in its report that "there is currently no commercial-scale proven technology, which is suitable for small scale copper concentrate smelting of less than 100,000 tonnes per year."
"A copper concentrate smelter of a feedstock of not less than 150,000 tonnes per year would cost between $500 million and $800 million to construct, complete with sulphuric acid plant for purification of fugitive gases emitted from the smelter furnace."
"Electricity is currently quite expensive in Tanzania and the existing capacity does not meet the requirements to run a large copper smelter.
For example, electrical energy requirement at Toyo Smelter in Japan is to the tune of 1.53MWh per dry metric ton of copper concentrate," it added.
The president also ordered the IGP to ensure all containers containing gold and copper concentrate at the mines are put under police watch until the contents are analysed by the government. Meanwhile, Acacia Mining, which owns three gold-producing mines in Tanzania - Bulyanhulu, Buzwagi and North Mara - said yesterday that its revenues have been hit hard by the ongoing export ban on mineral concentrate.
"At Bulyanhulu and Buzwagi, the combined direct impact of the current directive is the average daily loss of revenues of more than $1 million per day," Acacia said in a statement.
"Since the (ban) announcement, we have been engaging with key government officials and other stakeholders in an attempt to have the directive lifted.
To date there has not yet been a change in the situation." Analysts have warned that thousands of jobs and billions of shillings in government tax revenue could be at risk due to the financial crisis facing the gold mines after the export ban.
Acacia said it has offered to support and partner with the Tanzanian government in a new study by third party experts to assess the economic potential of building of a smelter in Tanzania capable of processing the concentrate in the country.
A previous study by the state-run Tanzania Minerals Audit Agency (TMAA) concluded in 2011 that building a gold/copper concentrate in Tanzania at a cost of up to $800 million was economically unviable since the country produces less than half of the 150,000 tonnes of ore per annum required to make a smelter operate profitably.
Acacia said since the March 3 ban was enforced, it has been compelled to take a range of actions to help manage this financial impact, whilst ensuring it continues to safely operate the affected Bulyanhulu and Buzwagi mines.
"The mines are continuing to operate as normal and as a minimum have sufficient capacity to be able to place gold/copper concentrate into containers on site beyond the end of April," it said.
"However, prior to reaching this point, during April we will reassess how long we can continue to produce as normal if the ban remains in place and what other measures may be necessary."
Acacia said it would continue to engage with relevant authorities in Tanzania with a view to resolving the current stoppage of the export of gold/copper concentrate and other related issues as soon as possible.
Tanzania is Africa's fourth-largest gold producer and Acacia its largest miner. Like other African nations, Tanzania is on a drive to add value to its exports rather than send raw materials abroad.
Acacia said its mines continue to operate as normal currently but added that it will reassess how long it can continue to produce as normal if the ban remains in place.
The Bulyanhulu and Buzwagi mines, which are located in Shinyanga Region, earn 50 per cent of their revenues from the export of gold/copper concentrates, which are sent for smelting abroad to extract gold, copper, silver and other minerals.
The miner said it has been forced to take several cost-cutting measures after the ban, including "a freeze on the hiring of new employees, restrictions on overtime, postponement of non-essential training and the suspension of some of our capital and non-operational projects."
Acacia chief executive officer Brad Gordon said earlier this month the company was unsettled by the ban, but expressed optimism that ongoing talks with senior Tanzanian government officials would reach a resolution in the "near future."
Acacia Mining's shares fell as much as 19 per cent at the London Stock Exchange (LSE) on March 3 after the company said it had stopped gold and copper concentrate exports from Tanzania following a ban ordered by President Magufuli.
President Magufuli has publicly raised concern of possible funny deals involving exports of gold/copper concentrate and even questioned the presence of airstrips at large scale gold mines as a possible source of government revenue loss from undeclared gold exports.
However, the TMAA report said "most of the copper concentrate producers in the world similar to that produced in Tanzania do not have their own smelters, but rather they export their concentrates mainly to China and Japan for smelting and refining."
"A commercially viable copper concentrate smelter requires a feedstock of not less than 150,000 tonnes per year. At full capacity, BGM (Bulyanhulu) and BZGM (Buzwagi) can produce 60,000 tonnes of copper concentrate annually, which would only account for 40 per cent of the capacity of a viable copper smelter," said TMAA. TMAA insisted in its report that "there is currently no commercial-scale proven technology, which is suitable for small scale copper concentrate smelting of less than 100,000 tonnes per year."
"A copper concentrate smelter of a feedstock of not less than 150,000 tonnes per year would cost between $500 million and $800 million to construct, complete with sulphuric acid plant for purification of fugitive gases emitted from the smelter furnace."
"Electricity is currently quite expensive in Tanzania and the existing capacity does not meet the requirements to run a large copper smelter.
For example, electrical energy requirement at Toyo Smelter in Japan is to the tune of 1.53MWh per dry metric ton of copper concentrate," it added.
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