UPDATE 1-North Mara gold mine operational -Barrick Tanzania

Mon Dec 15, 2008 6:46am EST

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NAIROBI Dec 15 (Reuters) - Barrick Gold (ABX.TO) said on Monday operations had resumed at its North Mara Mine in Tanzania after suspending activity last week when some 200 people invaded the site and destroyed property worth about $15 million.

"The mine is operational. We had only suspended work on Nyabirama pit. The government has bolstered security, but is still seeking a more permanent solution," Barrick Tanzania spokesman Teweli K. Teweli said.

North Mara is one of Barrick's smaller mines. It produced 43,000 ounces of gold in the third quarter and 155,000 in the first nine months of the year.

Teweli did not elaborate on the security measures in place at the mine, nor what solution the government was seeking.

Barrick said the invaders clashed with security personnel and set equipment ablaze. It did not say what the motives of the invaders were.

Some local media reported that they were seeking gold from the pit, while others said the people were villagers wanting sand.

Tanzanian media, citing police officials, reported that one civilian was shot dead during the incident. Media said police used tear gas and fired in the air to repel the attackers.

The company also operates the Bulyanhulu and Tulawaka mines in Tanzania and is building the Buzwagi mine.

Barrick said last week that cash costs in the quarter spiked over $1,000 an ounce, due in part to low production. Gold XAU= was at $827.20 an ounce on Monday.

Barrick's shares closed trade at 38.91 Canadian dollars ($31.53) on Friday, down from a year high of 54.11 Canadian dollars touched on Jan. 28. ($1=1.234 Canadian Dollar) (Reporting by George Obulutsa; Editing by David Clarke and Anthony Barker)

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