Foreign media reported on January 22 that Barrick Gold Corp. of Canada said Monday that it was exploring possibilities for its Lumwana copper mine in Zambia and that the government’s proposed new mining tax would pose challenges to shareholder returns.

Barrick recently completed a $6 billion acquisition of Randgold Resources in South Africa. The company said it was still communicating with the Zambian government to find a win-win solution for Lumwana Copper Mine under the new tax policy.

“Given the extremely challenging situation facing the mine, all options need to be considered,” the company said in a statement.

Zambia is the second largest copper producer in Africa. The country intends to raise the royalty tax on mining areas by 1.5 percentage points from January 1 this year (the previous tax rates ranged from 4% to 6%). In addition, when copper prices exceed $7,500 tons, an additional 10% tax is levied.

Barrick estimates that Lumwana’s copper production in 2018 will be between 19 and 225 million pounds. According to preliminary statistics, Barrick produced 383 million pounds of copper last year.

Willem Jacobs, chief operating officer of Barrick’s Africa and Middle East operations, said the new tax would weaken Lumwana Copper Mine’s ability to generate shareholder returns. The mine has submitted specific proposals for cooperation to the government.

Barrick said that the initial value of gold production in 2019 was 4.53 million ounces, and in the fourth quarter it was 1.26 million ounces.