Richland Resources has disputed claims made by the Tanzanian government that it owes the east African country $1.73 million in royalties.
The country’s Ministry of Energy and Minerals had said that the unpaid royalties dated back to the period between 2004 and 2008.
It said that it would not provide any further support to the mining activities of Richland’s wholly-owned subsidiary TanzaniteOne Mining until the retrospective royalties have been paid.
This move barred the miner from exporting gemstones produced or processed in Tanzania.
However, Richland said in a statement that the royalties related to revenues generated through subsidiaries outside and independent of Tanzania, including sales of finished jewellery from its South African and Mauritian registered subsidiaries.
“The company is urgently seeking clarification from the Ministry and the Minister of Energy and Minerals as to the enforceability of this prohibition on exports,” it said.
“The company is also investigating measures it can take to continue sales and exports via its other Tanzanian subsidiaries although it is not certain if this will be possible and any alternative arrangements may be at significantly reduced margins.”
Richland said that it would request a third party review of its legal case and the evidence before paying any claim for unpaid royalties.
“The company believes that it has a strong legal case and will accept the ruling of a legal tribunal where all the evidence is reviewed,” it said.
Richland’s shares were suspended last Monday morning and would remain so until it resolves the dispute.
Mathew Nyaungwa, Editor in Chief of the African Bureau, Rough&Polished
