Richland Resources (LON:RLD) has reached an accord with the Tanzanian government that will see a new mining licence issued for its tanzanite operation on a joint venture basis.
A letter of intent has been signed that will see 50% of the new licence transferred to STAMICO, the mining arm of the Tanzanian Government.
Full legal completion is expected in the coming weeks, which will also include the consideration to be paid by STAMICO to Richland. The amount was not revealed today.
The existing assets of Richland’s Tanzanite One division will not be affected by the agreement, which also does not cover the early stage graphite project at the Block C licence.
Tanzanite One and STAMICO will work together to curb tanzanite smuggling and illegal mining operations in the area.
"In particular, STAMICO will facilitate and liaise with the Tanzanian Government authorities to ensure that necessary regulatory and law enforcement actions are taken in a timely manner and mining operations are conducted in a safe, secure and conducive environment," Richland said.
Bernard Olivier, Richland’s chief executive, added : “We are pleased to have reached mutually acceptable terms in principle for a partnership with the Government of Tanzania that recognises the company's investment under its former licence in full compliance with the local participation requirement of the 2010 Mining Act and provides a commercially acceptable framework for the continuation of its mining operations in Tanzania."