GLNCY Glencore Plc (PK)

   By Nicholas Bariyo 
 

Barrick Gold Corp. (ABX.T) and Glencore PLC (GLEN.LN) say they expect to be granted a new license for their nickel project in Tanzania, just days after the East African nation cancelled a retention license for the troubled project as it continues to crack down on enforcing new mining regulations.

Company executives have held "fruitful discussions" with the government and expect to receive a prospective license that affords partners at least four years of tenure security, said Barrick spokesman Andy Lloyd.

"The project partners have applied for a prospecting license covering the same area as the retention License," Mr. Lloyd told The Wall Street Journal. "Glencore and Barrick expect to receive a prospecting license and look forward to continuing the constructive relationship that exists."

The licensing issue is the latest manifestion of the tension between investors and the Tanzanian government since President John Magufuli began to push for a bigger national share of the country's vast mineral wealth.

A retention license allows holders to maintain rights to projects after confirming commercial deposits even if they aren't ready to develop them yet. But under the new mineral rights introduced in January, retention licenses are being phased out, according to the country's mines ministry. A total of 11 licenses have been cancelled so far, says Idris Kikula, head of the state mine commission.

Barrick and Glencore, who own the 50-50 joint venture, are no stranger to African governments increasingly adopting aggressive stances against mining companies. Last year, Barrick's Tanzanian unit was hit with a $190 billion tax bill, while Glencore is currently battling a new mining code in Congo seeking to hike cobalt taxes five-fold.

Write to Nicholas Bariyo at Nicholas.Bariyo@wsj.com

(END) Dow Jones Newswires

May 14, 2018 08:23 ET (12:23 GMT)

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