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Barrick acquires gold prospecting licences in Tanzania from Tembo Gold

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(Kitco News) - Barrick Gold announced today that Bulyanhulu Gold Mine Limited, a subsidiary of Barrick, has entered into a binding agreement to acquire new gold prospecting licences in Tanzania.

According to a press-release, Bulyanhulu will acquire from Tembo Gold a 100% interest in six prospecting licences held by Mineral Industry Promotion and Consulting Company, a wholly-owned subsidiary of Tembo Gold.

"The licences are located in areas adjacent to the Bulyanhulu mine and have the potential to add significant mineral reserves to Barrick's asset base in Tanzania," the company said in a statement.

Under the terms of the purchase agreement, the consideration payable by Bulyanhulu is $6 million, plus certain other contingent payments of up to an aggregate amount of $45 million (source: Tembo Gold), which will be calculated based on the inferred, indicated and measured gold mineral resources identified in the areas of land which are covered by the licences using Barrick standards for determining mineral resources.

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Additionally, the company said that Bulyanhulu is required to invest a minimum of $9 million in the licence area over the course of the four years following the closing of the transaction.

Concurrently with the execution of the purchase agreement, Bulyanhulu has agreed to subscribe for, on a non-brokered private placement basis, 5,518,764 of common shares of Tembo at a price of C$0.27 per common share.

Barrick president and chief executive Mark Bristow said the acquisition was a significant step forward in the company's strategy of increasing its investment in new growth opportunities in Tanzania and a further demonstration of the value-creation potential of its partnership with the government.

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