Tanzania: Mining company infiltrated by crime syndicate

African Barrick Gold (ABG) today said that it has uncovered organised and systematic onsite fuel theft at its Buzwagi mine in Tanzania.

“Investigations into this matter indicate that criminal fuel theft syndicates have widely infiltrated our mining department,” the London-listed company said in a statement.

ABG has suspended approximately 60 employees and a number of contractors, representing over 40% of the mining department, pending further disciplinary procedures.

As a result of the development, the mining of higher grade ore has been delayed and low grade stock piles are currently being processed. This has led to a reduction of approximately 10,000 ounces of production in the third quarter.

The statement continues by saying that “management initially expected to recover this production over the remainder of the year. However, the time frame to bring in replacement operators was delayed. Approximately 20 operators have now been seconded from Barrick to assist in restoring the mining operations to planned levels and to train a new team of operators.”

The company estimates that the delay caused by this incident to the mining of higher grade ore zones in Stage 1 will reduce full year production at Buzwagi by approximately 30,000 ounces.

“The operational initiatives at Buzwagi were on track to deliver production in line with guidance stated in our interim results, albeit at the bottom end of the range of 750,000 to 800,000 ounces. As a consequence of our actions to address the fuel theft, we now anticipate production will be comparable to that of 2009, which was 716,000 ounces,” ABG explained.

African Barrick Gold has four producing gold mines in northwest Tanzania — North Mara, Bulyanhulu, Tulawaka and Buzwagi — in addition to a suite of exploration properties.