TANZANIA: STAMICO ORDERS TANZAM TO RESUME MINING OPERATIONS SOON

Source: Information Centre For The Extractive Sector(ICES)

State Mining Corporation (STAMICO) has dismissed as lame excuses claims that the suspension of mining operations at Geita-based Buckreef Gold Mine was due to forceful occupation by illegal miners.

Instead, the corporation has ordered the Tanzania American International Development Corporation 2000 (TANZAM 2000) to unconditionally resume operations with immediate effect, blaming the suspension on major technical challenges and serious financial hitches troubling the company.

TANZAM 2000 is a joint venture, with STAMICO controlling 45 per cent shares. TANZAM 2000 shares are under Tanzanian Royalty Exploration (TRX). STAMICO said in a statement over the weekend that Buckreef sent on unpaid leave all managers and six staff for care maintenance without notifying them, which is contrary to the JV agreement.

“For what could be termed as a deliberate move and for the reason best known to themselves, on February, TRX withdrew all security guards at Buziba Prospecting Licence without notifying Stamico,” the firm said in the statement.

Stamico said they sent an independent inspection team to Buckreef in March to examine the state of business and affairs of the mine but received minimal cooperation from TANZAM. The team, however, found out that there was no security threat to justify the suspension of mining operations.

“Buckreef faces major technical challenges due to total failure of the newly installed but poorly designed Heap Leach Process Plant,” Stamico said in the statement. The team also revealed serious financial problems, amid increasing list of aggrieved debtors and suppliers.

The report showed that the mining firm failed to make statutory payments, including taxes to Tanzania Revenue Authority and employee contributions to pension funds. “It’s obvious that TANZAM 2000 opted to the excuse of security threat as a desperate attempt to cover up critical technical and financial problems,” the statement read.

The Buckreef’s JV was entered in October 2011. The project area comprises the old Buckreef Gold Mine and four prospects namely Buckreef, Buziba, Tembo and Bingwa.

 

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