Mining firm’s operations slowed by tiff with Tanzania

Acacia Mineral Company worker at work in Ikolomani, Kakamega County. (Photo: Chrispen Sechere/Standard).

The standoff between a UK mining company and the Government of Tanzania could slow down activities at a Kakamega gold mine.

Acacia Mining Friday said it has been shipping samples from its western Kenya prospect to South Africa for testing rather than to its Tanzanian facilities, where the firm is fighting Government accusations that it is undertaking business illegally, including tax evasion.

The company has been mining gold and other minerals in Tanzania and has fairly advanced equipment there including mineral testing laboratories.

The Tanzania government banned the exports earlier this year, claiming the miner was under-declaring exports and paying less in taxes and royalties.

It has since instituted investigations that are expected to ascertain the amount of mineral concentrates Acacia mines and exports from the country.

In a statement, Acacia said it had made progress at its Kenyan mine but has been slowed down by the need to take the ore samples to South Africa for testing.

It has so far managed to ship the samples from wells that were drilled during the first quarter of 2017, with the output in the second quarter waiting to undergo the process.

“At the end of June we had approximately 23 holes with assays (ores) pending due to the need to send samples to South Africa rather than to Tanzania, due to impact of the current export ban,” said the firm in an update to its shareholders.

“As a result, the majority of the results received during the period are from the first quarter.”

Acacia in February this year announced the discovery of what it said was high-grade gold at its mines in Kakamega County.