JOHANNESBURG (miningweekly.com) – The share of revenues that the government of Tanzania has received from the Geita gold mine is “pretty generous” when compared with what shareholders have received, AngloGold Ashanti CEO Srinivasan Venkatakrishnan said on Monday when the company reported an adjusted headline loss of $93-million, which includes retrenchment provision of $47-million and a silicosis provision of $46-million.
Since 2000, the Tanzanian government has received 55% of the cash distributed compared with AngloGold’s 45%, with the Geita mine delivering more than $1-billion in royalties, corporate taxes and employees’ income tax since 1999. (Also watch attached Creamer Media video)
“It’s important that we actually get that information out to increase the awareness,” Venkatakrishnan said in response to media questions during a round table attended by Mining Weekly Online. When the time value of money is included, the government’s share is significantly higher.
In nominal terms, payback of AngloGold’s initial Geita investment took a dozen years, compared with the Tanzanian government having been a beneficiary from day one and with its cumulative share of total benefit increasing as the mine life progresses. Moreover, Geita has had a money-absorbing past, owing to the collapse of the main pit-wall in 2007 and a major mill replacement in 2012.
“That we’ve contributed significantly to the Tanzanian economy in the form of taxes should count in our favour,” Venkatakrishnan said of the company’s decision to seek a dialogue with the government on the East Africa country’s latest unilateral changes to the Mine Development Agreement (MDA) the Johannesburg- and New York-listed gold-mining company has with it.
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