Two laws have been passed by the Tanzanian Government this week allowing it to renegotiate mining and energy company contracts, which could affect Australian investors.
Three bills were tabled in parliament last week, amending the Mining Act 2010, and later passed on Monday. These included the Natural Wealth and Resources (Permanent Sovereignty) Act, 2017; the Natural Wealth and Resources Contracts Act; and the Written Laws (Miscellaneous Amendments) Act.
The Natural Wealth and Resources Contract Act was proposed to provide a way for the people of Tanzania, through the National Assembly, to review agreements made by the government.
“The mechanism for review is included to ensure that the terms and conditions of such arrangements or agreements are in line with the interest of the people and the united republic,” the act said.
It was also lodged to ensure any investments in natural resources are “free from wanton exploitation”; to “safeguard the property of the state authority and all property collectively owned by the people of the united republic”; and “to combat all forms of waste and squander”.
Perth-based Walkabout Resources, which owns the Lindi Jumbo project in Tanzania, said the amendments were “contrary to encouraging mining investment” and added that it was “of serious concern to all foreign investment in mining related activities in Tanzania”.
However, upon a review of the amendments and the potential impact on the company’s project, Walkabout noted that as the bills currently stand they would not “cause the company to halt or suspend its investment in the project or from working in Tanzania.”
Another Perth-based company, Kibaran Resources, also conducted a review of the potential impact of the legislation, stating that the laws are not expected to affect its company.
“Kibaran understands that the legislation is designed to address the mining and export of precious metals and metal concentrates from existing operations in Tanzania,” it said in a statement.
“The company’s Epanko graphite project will produce and industrial mineral product of 96 per cent carbon that will be sold as a final product directly to customers in Germany, Japan and South Korea…As an industrial mineral operation the majority of the new provisions are not expected to impact the company as they appear targeted at mining operations for metals, precious metals, metal concentrates and gemstones.”