AngloGold Ashanti Ltd plans challenging the Tanzanian government through arbitration, following changes in the mining law that would enable state sovereignty over mineral wealth.
In a Bloomberg interview, CEO AngloGold, Srinivasan Venkatakrishnan confirms plans to renegotiate agreements in a more favourable way for the company, “We have reached out to the government for negotiations and we are agreeing the logistics on when we meet with the government.”
In a bid to double its GDP to 10% by 2025, Tanzania, in 2017, approved two laws that enable the government to renegotiate contracts with mining and energy companies in other to gain higher royalty payments (50% shares in mining companies).
While planning to extend its lifespan in the country, AngloGold, which owns Tanzania’s biggest open-pit mine, Geita, filed an appeal with the United Nations Commission on International Trade Law to uphold a mine development agreement the company signed with Tanzania in 1999.
Following heavy losses incurred in its South African mines, AngloGold as forced to sell off some mines. However, last week, the company announced its plans to reopen an idle mine in Ghana, after the country approved a plan to redevelop the asset as a more profitable, mechanized operation.
Living up to its reputation and name, Venkatakrishnan said AngloGold will “never say never” on moving its primary listing from Johannesburg. He also noted, “We are quite comfortable with the diverse nature of the portfolio, having said that, for the right offer, every one of the assets we have to look at in terms of potentially putting it on a disposal track if we choose to.”
Tanzania is yet to set dates for the talks.