A new MIGA guarantee will help tap the potential of Tanzania's underdeveloped mining sector, helping the country diversify its economy. In fiscal 2001, Barrick Gold Corp. of Canada received a $56.25 million MIGA guarantee for its investment in an underground gold, silver, and copper mine in Tanzania. Private insurers are providing facultative reinsurance. The insurance will cover the investment against the risks of transfer restriction, expropriation, and war and civil disturbance. Canada's Export Development Corporation is coinsuring the project.
The project involves establishing and operating a mine and mill complex. Over the life of the mine, the project is expected to annually produce 420,000 ounces of gold, 240,000 ounces of silver, and 3.8 million kilograms of copper. Innovative approaches are being taken to dispose of tailings, using paste technology and backfilling in the underground mine.
The investment will contribute to the development of the country's infrastructure. Communities surrounding the plant will benefit directly through improved access to potable water drawn from the water pipeline being constructed by the project sponsors, the availability of electrical power to local households, and the development of roads.
The project created approximately 1,500 jobs during construction and more than 1,000 new jobs to operate the facilities. Under agreement with the government, the project enterprise will prepare and carry out an effective employment and training program for its Tanzanian employees in each phase and at all levels of operation. The project will pay an estimated $75 million in taxes, royalties, and duties to the government during the initial 15 years and procure some $10 million a year in local goods and services.