The $US3.7 billion ($A3.6 billion) mine reached commercial production in January and the Dominican government has made it clear it wanted larger returns.

Barrick said the new agreement, which came after eight months of discussions, preserved the economic value of the mine, while addressing the fiscal objectives of the country.

The company said the new in-principle agreement would increase government revenue and bring it forward.

Possible amendments to the agreement include the elimination of a 10% return embedded in the initial capital investment, an extension to the period over which the partners will recover their capital investment, a delay of application of net profits interest deductions and a reduction in depreciation rates.

Barrick said a graduated minimum tax would be established, which would be adjusted up or down based on metal prices.

The annual minimum tax rate will be reset every three years and will be equivalent to 90% of the taxes that would have been payable by the partners over the same period.

Barrick said, based on the proposed changes, it anticipated there would be a 50/50 split of the expected cashflows between the partners and the government between now and 2016.

Expected tax revenues to the government would be around $2.2 billion at a $1600 an ounce gold price.

The Dominican Republic government’s economic benefits from the changes are expected to amount to $1.5 billion.

The agreement will also likely set a corporate income tax rate of 25%, a net smelter royalty of 3.2% and a net profits tax of 28.75%.

Pueblo Viejo is expected to produce over 1 million ounces of gold per year in its first five years at all-in costs of $500-$600 an ounce.

Barrick owns 60% of the mine, while Goldcorp holds the balance.

The existing agreement will continue until amendments are made.

The changes are still subject to the negotiation of a definitive agreement, which will require Barrick and Goldcorp board approval, as well as the approval of project lenders, and Dominican approval.

In February Dominican President Danilo Medina said he was seeking to amend Barrick and Goldcorp’s contract for the new mine to give his people a larger share of the profits.

"In other words, during the early years, for every $US100 of income the export of gold and other metals, Barrick would receive $97 and the Dominican people $3," he said in a translated statement.

"That is simply unacceptable."

He added that gold could “only be extracted, processed and exported if the distribution terms of revenue generated by the exploitation of this non-renewable resources were fair and favourable to the Dominicans”

“And at the present time they are not.”

There was further controversy in March when a gold shipment from the mine was detained by Dominican customs authorities.

Pueblo Viejo is one of Barrick’s growth projects, the other being Pascua-Lama on the border of Chile and Argentina, where it is also having issues.

Last month construction on the Chilean side had to be suspended after a court injunction was filed over environmental concerns.

Barrick shares jumped 8.6% in Canada overnight, while Goldcorp was up more than 6%.