Santo Domingo. - The Dominican Republic didn’t receive any stake in the gold mine at Pueblo Viejo in exchange for Barrick Gold’s right to exploit the deposit, although its local CEO affirms that the Government will receive nearly 50% of its net capital flow, in addition to tax revenue.

Manuel Bonilla said the Government will receive 3.2% of the net value of the sales, or 32 dollars for each 1,000 dollars of gold which Barrick sells. He said the Government’s other benefit is the Income Tax (ISR), but only when the mine starts to post a profit (around 2013, one year after its start of operations).

However Barrick Pueblo Viejo will pay a fixed rate of only 25%, compared with 29 percent paid by all companies around the country. The Government will also obtain 28.75% of the miner’s after-tax profits.

That revenue however starts after Barrick recovers its estimated US$3.8 billion initial investment plus 10% of that total (US$380 million). “It’s because of the total of those three taxes that we say the Government can obtain as much as 50% of the profits and that’s the highest contribution from a mining company to the government in any country in the world.”

Bonilla, interviewed by the Corripio Communications group, also noted that the Government, as well as the company, benefits from the global rise in gold prices.

He said when the Government and Barrick signed the contract an ounce of gold was 700 dollars and surpasses US$1,500 today. “The State will receive 50% of each dollar when the price of an ounce of gold increases over 700 dollars, which is the cost of extraction.”