Acacia Mining plc (LON:ACA) said it has been in talks with the government in Tanzania to lift a ban on exports of gold and copper concentrate from the country.
The Ministry of Energy and Minerals on 3 March said that all exports of gold, copper, nickel and silver have been prohibited to ensure mineral value-addition activities are carried out within Tanzania.
Gold and copper concentrate accounts for almost 30% of Acacia’s group revenue.
Acacia said it is losing combined revenues of more than US$1mln per day at its Bulyanhulu and Buzwagi mines in the region as a result of the directive.
“We are taking a range of actions to help manage this financial impact, whilst ensuring we continue to safely operate the mines,” the company said.
“The mines are continuing to operate as normal and as a minimum have sufficient capacity to be able to place gold and copper concentrate into containers on site beyond the end of April.”
If unable to persuade authorities to lift the ban, the group will reassess how long it can continue to produce as normal if the ban remains in place and what other measures it can take.
But until then Acacia said it will focus on negotiations with authorities in Tanzania to resolve the stoppage of the exports.
The news comes just days after Acacia Mining and Canada's Endeavor Mining said they suspended merger talks following the export ban. Both companies released statements saying they ended discussions due to doubts on whether the deal would deliver value to their respective shareholders.
The negotiations over a potential merger first emerged in January this year. The merged company would have created a rival to London's largest gold miner Randgold Resources with combined assets in Tanzania, Cote d'Ivoire, Burkina, Ghana and Mali.
"We wonder if, following the concentrate ban, Endeavour decided to seek terms improved in its favour (we know we would have). Perhaps they pressed just a bit too hard?," said Shore Capital.