Canadian mining major Barrick Gold Corp (NYSE:ABX) has struck a deal with the Tanzanian government to resolve a dispute, which has hit operations in the country, sending shares in its London-listed subsidiary Acacia Mining PLC (LON:ACA) surging.
Barrick agreed the African country would take a 16% stake in three gold mines operated by Acacia, a 50% share in revenues from the mines and a one-off payment of $300mln (£228m).
Reuters reported that Barrick's chairman John Thornton said the deal would need to be approved by independent shareholders and directors of Acacia Mining.
Acacia said it had received a copy of the framework agreement referred to in a regulatory release by Barrick and was seeking further clarification.
"No formal proposal has been put to Acacia for consideration at this point in time," it said.
Acacia shares surged almost 17% to 213.50p late on Thursday.
Barrick has been in talks with Tanzania for months after it banned the export of unprocessed minerals and enacted new laws to raise state ownership of the nation's mines.
The East African country is the continent’s fourth largest gold producer.
"Following constructive discussions with our Tanzanian partners, we have developed a framework for a modern, 21st century partnership that should ensure Acacia's operations generate sustainable benefits and mutual prosperity for the people of Tanzania, as well as for the owners of Barrick and Acacia," said Barrick's executive chairman John Thornton.
"A partnership requires trust between the parties, and transparency is the currency of trust. Through our discussions over the last three months we have established both and this will form the basis of our relationship in the future."
Barrick holds a 63.9% interest in Acacia, which is operated independently of Barrick.