Company News

BUZZ-Acacia: to reduce Tanzania operations, cut jobs

** Gold miner Acacia (-10.7 pct) at the bottom of the FTSE Midcap Index

** Co says it will have to reduce operations at its Bulyanhulu mine and cut its mostly Tanzanian workforce as it aims to return to profitability in 2018

** Co, Tanzania’s largest miner, which is majority-owned by Barrick Gold, is in dispute with the country over tax payments and caught up in sweeping mining industry changes spearheaded by President John Magufuli, who believes his country is not getting its fair share of profits

** Tanzania imposes a ban on exports of gold and copper concentrate in March, leading to a build-up of approximately $265 mln of concentrate inventory in Tanzania, based on current prices

** The ban has led to a negative cash flow of approximately $15 mln per month at the mine and made ordinary operations at Bulyanhulu unsustainable, Acacia says

** Now expects annual production to be in the order of 100,000 ounces lower than the bottom of the previous guidance range of 850,000-900,000 ounces

** Stock has fallen over 64 pct since its problems began in Tanzania in March (