African Barrick COO quits, sends stock nose-diving

Only three weeks after African Barrick (LON:ABG) announced it was replacing its CEO Greg Hawkins, Tanzania's largest gold company said Chief Operating Officer Marco Zolezzi has also decided to hit the trail.

In a short statement, the firm said the recently appointed CEO Brad Gordon would take direct responsibility for operations while a search for a replacement is underway. It added that Zolezzi has left “to pursue other interests.”

The effect on the company’s stocks was immediate. By 9:30 am GMT they have dropped 5.7% to 157 pence in London, extending the firm’s loss to 64% so far this year.

As most miners, African Barrick has been struck by lower bullion prices, high costs and production delays resulting in three consecutive years of output decline, and a 73% value loss since it listed in London in 2010.

On top of these issues, the miner has been dealing with illegal mining, strikes, electricity shortages and even a lawsuit. In July, a group of Tanzanian villagers filed in London a claim over the deaths and injuries of locals, including one incident where five men were shot and killed at the North Mara gold mine in May 2011.

The mid-cap gold miner recently announced cost cuts and completed an operational review of its Tanzanian mines, while it tries to improve performance.

African Barrick employs about 5,600 workers and 3,500 contractors.