Barrick subsidiary Bulyanhulu Gold Mine is set to acquire six prospecting licences located in areas adjacent to the namesake Bulyanhulu mine in Tanzania.

The move was announced by Twiga Minerals, a joint venture (JV) between Barrick and the Government of Tanzania.

According to a statement, Bulyanhulu signed a binding agreement to purchase a 100% stake in the six licences from Tembo Gold subsidiary Mineral Industry Promotion and Consulting Company Limited (MIPCCL).

Bulyanhulu will pay a $6m consideration, along with other contingent payments up to an aggregate amount of $45m. These contingent payments will depend on the inferred, indicated and measured gold mineral resources identified in the licence areas.

Bulyanhulu will also invest at least $9m in the overall licence area in four years from the closing of the transaction.

The Barrick subsidiary has also agreed to subscribe for more than 5.5 million Tembo common shares of Tembo at a price of C$0.27 per share. This will provide Bulyanhulu with a 5.5% pro forma ownership in Tembo.

Tembo president and CEO David Scott said: “We do not underestimate the significance of Barrick’s interest and the conclusion of this purchase agreement that will enable a serious advance of our exploration strategy, and our expectation and hope is that a number of significant new discoveries will be made, benefitting both the companies that are making the investment, the surrounding communities and this mining-friendly country of Tanzania.”

The acquisition and the private placement are expected to close in the first quarter of next year, subject to certain regulatory approvals in Tanzania and the TSX Venture Exchange approval.

Once complete, the deal will further bolster Barrick presence in Tanzania.

Situated in north-west Tanzania, the Bulyanhulu mine hosts gold, silver and copper mineralisation in sulphides. It commenced commercial production in 2001.

Earlier this year, Barrick signed an option agreement to acquire a stake in a Canadian gold project.