New Airport Terminal at Kahama Airstrip to Leave Lasting Legacy at Barrick’s Buzwagi Gold Mine
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Insights
The handover of the new airport terminal by Barrick Gold Corporation to the Tanzania Airport Authority is a strategic move that could have a ripple effect on the local economy and potentially influence the company's social license to operate. The investment in infrastructure, particularly in a region where the company's mining operations were once a major economic contributor, demonstrates a commitment to sustainable practices and community development. This could enhance Barrick's reputation and stakeholder relations, possibly leading to a more favorable operating environment and easier access to future projects or expansions.
Moreover, the establishment of a Special Economic Zone (SEZ) where the Buzwagi gold mine once operated suggests a long-term vision for economic diversification and job creation. If the SEZ succeeds in becoming the new economic driver for the region, it could lead to increased service levies and employment taxes, which are beneficial for both the local government and Barrick's corporate social responsibility profile. The potential for new jobs and economic activity might also indirectly support Barrick's stock as investors often look favorably upon companies with strong community and environmental stewardship.
The investment of $384,000 into local infrastructure, particularly an airport terminal, is a modest sum relative to Barrick's overall financial capacity but could have significant economic implications for the Shinyanga region. Improved transportation infrastructure can facilitate trade, tourism and investment, leading to a more dynamic local economy. The multiplier effect of such an investment could be substantial, potentially leading to higher economic growth rates in the region.
From an economic standpoint, the transformation of a closed mine into a Special Economic Zone is a noteworthy attempt at economic restructuring. SEZs can attract foreign direct investment, promote exports and encourage technology transfer. If managed effectively, the SEZ could become a sustainable source of revenue and employment, offsetting the economic vacuum left by the closed mine. This could serve as a model for other mining companies on how to mitigate the economic impacts of mine closures.
The environmental rehabilitation of the Buzwagi gold mine site is a critical component of Barrick's post-mining strategy. Effective rehabilitation can prevent long-term environmental damage and promote sustainable land use post-mining. The feasibility study indicating that the SEZ could sustainably create jobs and generate significant revenue for the local municipality suggests that Barrick is taking a holistic approach to environmental stewardship and economic sustainability.
However, the actual environmental impact of the SEZ will depend on the types of industries attracted and their environmental footprints. It is crucial for Barrick to ensure that the SEZ adheres to high environmental standards to avoid trading one form of environmental degradation (from mining) for another (from industrial pollution). This will be essential for maintaining the company's environmental credibility and for the long-term health of the local ecosystem and communities.
All amounts expressed in US dollars
KAHAMA, Tanzania, Jan. 21, 2024 (GLOBE NEWSWIRE) -- Barrick Gold Corporation (NYSE:GOLD)(TSX:ABX) – The role of a sustainable mining company is not only to create value for stakeholders today but to ensure it leaves behind a positive legacy that will continue to serve local communities long after mining is complete. This is according to Barrick president and chief executive Mark Bristow who was speaking today at the official handover ceremony of the new airport terminal built at the closed Buzwagi gold mine’s Kahama airstrip to the Tanzania Airport Authority (TAA).
The ceremony marks the conclusion of an eight-month partnership between Barrick and TAA at a total cost of
The Buzwagi gold mine was an economic powerhouse for Tanzania’s Shinyanga region for nearly 15 years. At its peak, Buzwagi was the second largest operating mine in Tanzania and employed more than 3,000 people. Its operational life came to an end in July 2021 and the mine was officially closed in July 2022. Since then, Barrick has been attending to Buzwagi’s environmental rehabilitation while also advancing its plans to transform the closed mine into a Special Economic Zone.
A feasibility study commissioned in 2021 showed that the creation of the Special Economic Zone had the potential to replace the mine as the region’s economic driver and could sustainably create 3,000 jobs annually, generate more than
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Georgia Mutagahywa
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Kathy du Plessis
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Website: www.barrick.com
Cautionary Statement on Forward-Looking Information
Certain information contained or incorporated by reference in this press release, including any information as to our strategy, projects, plans, or future financial or operating performance, constitutes “forward-looking statements”. All statements, other than statements of historical fact, are forward-looking statements. The words “potential”, “expected”, “plans”, “transform”, “could”, and similar expressions identify forward-looking statements. In particular, this press release contains forward-looking statements including, without limitation, with respect to: the ability to transform the Buzwagi mine into a Special Economic Zone; Barrick’s partnership with the Government of Tanzania; Barrick’s sustainability initiatives in Tanzania and continued investments in community projects; and Barrick’s contributions to the local economy including its tax contributions, local hiring and procurement programs and spending.
Forward-looking statements are necessarily based upon a number of estimates and assumptions including material estimates and assumptions related to the factors set forth below that, while considered reasonable by the Company as at the date of this press release in light of management’s experience and perception of current conditions and expected developments, are inherently subject to significant business, economic, and competitive uncertainties and contingencies. Known and unknown factors could cause actual results to differ materially from those projected in the forward-looking statements, and undue reliance should not be placed on such statements and information. Such factors include, but are not limited to: fluctuations in the spot and forward price of gold, copper, or certain other commodities (such as silver, diesel fuel, natural gas, and electricity); the speculative nature of mineral exploration and development; changes in national and local government legislation, taxation, controls or regulations and/ or changes in the administration of laws, policies and practices; expropriation or nationalization of property and political or economic developments in Tanzania and other jurisdictions in which the Company or its affiliates do or may carry on business in the future; changes in mineral production performance, exploitation, and exploration successes; the possibility that future exploration results will not be consistent with the Company’s expectations; disruption of supply routes which may cause delays in construction and mining activities, including disruptions in the supply of key mining inputs due to the invasion of Ukraine by Russia; risk of loss due to acts of war, terrorism, sabotage and civil disturbances; failure to comply with environmental and health and safety laws and regulations; timing of receipt of, or failure to comply with, necessary permits and approvals; uncertainty whether some or all of Barrick’s targeted investments and projects will meet the Company’s capital allocation objectives and internal hurdle rate; damage to the Company’s reputation due to the actual or perceived occurrence of any number of events, including negative publicity with respect to the Company’s handling of environmental matters or dealings with community groups, whether true or not; risks associated with new diseases, epidemics and pandemics, including the effects and potential effects of the global Covid-19 pandemic; litigation and legal and administrative proceedings; employee relations including loss of key employees; increased costs and physical and transition risks related to climate change, including extreme weather events, resource shortages, emerging policies and increased regulations relating to related to greenhouse gas emission levels, energy efficiency and reporting of risks; and availability and increased costs associated with mining inputs and labor. In addition, there are risks and hazards associated with the business of mineral exploration, development and mining, including environmental hazards, industrial accidents, unusual or unexpected formations, pressures, cave-ins, flooding and gold bullion, copper cathode or gold or copper concentrate losses (and the risk of inadequate insurance, or inability to obtain insurance, to cover these risks).
Many of these uncertainties and contingencies can affect our actual results and could cause actual results to differ materially from those expressed or implied in any forward-looking statements made by, or on behalf of, us. Readers are cautioned that forward-looking statements are not guarantees of future performance. All the forward-looking statements made in this press release are qualified by these cautionary statements. Specific reference is made to the most recent Form 40-F/Annual Information Form on file with the SEC and Canadian provincial securities regulatory authorities for a more detailed discussion of some of the factors underlying forward-looking statements and the risks that may affect Barrick’s ability to achieve the expectations set forth in the forward-looking statements contained in this press release.
Barrick disclaims any intention or obligation to update or revise any forward-looking statements whether as a result of new information, future events or otherwise, except as required by applicable law.
FAQ
What is the total cost of the new airport terminal project?
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What is the potential annual revenue from service levies for the local municipality?
What is the estimated annual employment tax revenue from the Special Economic Zone?
