Despite recent falling gold prices, Tanzania's sizeable gold resources are still attracting FDI from large overseas operators in both the exploration and exploitation fields.

In 2013 around 19% of the world's gold production came from Africa. And Tanzania is currently Africa's fourth largest producer, beaten in the rankings only by South Africa, Ghana, and Mali. The country has an estimated gold reserve of 45 million ounces, and gold production currently stands at around 44 tons a year. In 2013, the export value of the country's unwrought gold, which is impure gold that requires further processing, was just under $910 million. That figure is marginally down on the 2012 figure of $929 million, but considerably higher than the export value over the 15 years prior to that.

Tanzania's gold resources are predominantly found in the Greenstone Belt, south, east and west of Lake Victoria. A greenstone belt is a zone where metamorphic minerals, including in some cases gold, are found within mafic rocks, and these minerals impart a green hue to the rock structure. Today, Tanzania's Greenstone Belt is considered to be one of the finest geological structures of its kind in the world.

Following Tanzania's independence in 1961 its mining sector was brought under state control. The situation began changing in the late 1980s and early 1990s when the government moved to liberalize and privatize the sector. The Ministry of Energy and Minerals' Mineral Policy of 1997 reaffirmed the government's desire to promote greater private investment in the sector. And the government's policies to encourage international investors, alongside legislative reforms, have indeed worked. Fresh legislation was brought in with the 1998 Mining Act, and the Tanzanian Investment Centre was set up under the Tanzanian Investment Act 1997 to promote inward investment. In the case of the gold mining industry, FDI increased substantially, fuelled by this reform and the consequent opening up of the sector. Tanzania now has a number of major international gold mining operators active in-country.

The fiscal regime that applies to gold exploration and mining is a favorable one. Mining royalties for gold are at 3%, which is around the average for Africa. But that figure is low in global terms, where rates are up at around an average of 6.6%, according to 2012 research published by the African Development Bank. There is also an exemption on value-added tax and import duties for equipment and materials until one year after production commences, and there is a 5% cap from that point on. In addition, there is no restriction on mining companies repatriating profits.

Of the multinationals present in Tanzania, African Barrick Gold (ABG), a subsidiary of the Canadian company, Barrick Gold Corp. currently has three large-scale gold mines in operation: Bulyanhulu, Buzwagi, and North Mara. All three mines are situated in northwest Tanzania. The Bulyanhulu mine has a hefty 30 to 50 year life expectancy based on current data, with probable reserves of 9.4 million ounces. Buzwagi mine is a low-grade bulk deposit and is an open pit mining operation. Both the Bulyanhulu and the Buzwagi mines produce doré gold bars (a semi-pure alloy of gold and silver), and copper/gold concentrate. ABG's third mine, North Mara, is 100 kilometers east of Lake Victoria. It is currently an open pit mine, although ABG is planning to do some underground work starting in 2015. The life expectancy of North Mara is estimated at 10 years with probable reserves of 2.2 million ounces.

ABG also has what it describes as a satellite deposit at Golden Ridge, southeast of Bulyanhulu. And significantly its Nyanzaga Project includes the Tusker Deposit believed to be one of Tanzania's largest undeveloped gold deposits, estimated at 4.6 million ounces. This is clearly encouraging news for future gold production in the country.

The AngloGold Ashanti owned Geita gold mine, situated 20 kilometers from Lake Victoria, employs a workforce of approximately 3,500. It commenced production in 2000 and is expected to operate until 2022. This is the company's only mine in Tanzania and operates as an opencast mine with three pits. So far, AngloGold Ashanti has put $600 million in investment into the mine and paid the government of Tanzania around $683 million in taxes and royalties. Geita is currently Tanzania's most productive mine producing 37% of the country's output in 2013. The company has also received a number of awards from the Tanzanian government for its corporate social responsibility (CSR) programs, including water supply and education projects in the local area, according to BeMining magazine.

Located 200 kilometers south of Lake Victoria, the Golden Pride mine signaled the birth of Tanzania's modern gold mining industry when it was commissioned back in 1998. Operated by Australian company, Resolute Mining Ltd., the Golden Pride has gone on to produce over 2.2 million ounces of gold since it opened. But the operation has run its course and the mine is being wound down in 2014 for closure by the company.

Another player worth mentioning, Shanta Gold, describes itself as an emerging gold explorer and producer in the Tanzanian market with a focus on smaller, high-grade gold prospects. Its New Luika mine is in Tanzania's Lupa Gold Field in southwest Tanzania. The company's stated probable total reserves for the mine are 690,000 ounces (as at October 2014). This year it is on-track to produce 80,000-83,000 ounces, and is currently experiencing record production levels.

In terms of exploration there are various overseas interests active in Tanzania, some in private joint ventures, and others in partnership with the government's own State Mining Corporation. Resolute Mining Ltd. has turned its attention to the Kanegele Exploration Project in the Nyakafuru District, where it also has a joint venture with ABG with drilling operations ongoing there. Other players include, Kibo Mining Inc. an Irish registered company specifically set up in 2008 to carry out gold, and other mineral and exploration work in Tanzania. The company has exploration projects in the Lake Victoria goldfields, as well as in the newer exploration region of eastern Tanzania, with its Morogoro Project.

The Canadian company, Lake Victoria Mining, has nine prospective gold projects in its Tanzanian portfolio. In June 2014 the Ministry of Energy and Minerals granted the company a license to commence a medium-sized gold mine at its Kinyambwiga Project. Now the company is looking to raise $3 million in investment capital to proceed with the mine's development.

Regardless of whether Lake Victoria Mining Company makes a go of that venture, the granting of this new license demonstrates that international interest in exploring and exploiting Tanzania's wealth of gold reserves is not slowing down. Undoubtedly there are still many issues for the industry and the country to work on. Recent falls in international gold prices have caused operators to stop and look at their production efficiency, some have scaled back as a result, and losses have occurred. Further, environmental and safety issues attendant on mining, including water, food, and air pollution need to be tackled by Tanzania. Illegal, small-scale mining is also a security concern for foreign investors, but seemingly not a deterrent for new entrants to the market at present. Taken as a whole, it is clear that Tanzania has achieved its aim of enticing FDI into the country's gold mining sector as it set out to do.