"These discussions were part of our ongoing efforts to identify opportunities to optimize our portfolio," said Barrick president and CEO Jamie Sokalsky.
"However, we are approaching this in a prudent and disciplined manner and will only proceed with opportunities that generate acceptable value for Barrick."
Sokalsky said African Barrick Gold's assets hold significant potential and the company will continue to look for ways to best realize that value for shareholders.
Barrick holds a 73.9 per cent interest in the company, which was formed when the Canadian gold miner spun off its African operations in March 2010.
African Barrick is Tanzania's largest gold producer and one of the five largest gold producers in Africa.
Barrick Gold shares closed down 43 cents at C$33.14 on the Toronto Stock Exchange, while African Barrick shares were down 20 per cent or about 91.9 pence at 352.1 pence Tuesday on the London Stock Exchange.
John Ing, president and chief executive of investment firm Maison Placements Canada, noted the African Barrick has struggled with high costs in recent months.
"These are not primo assets," he said.
Ing said Barrick would have welcomed the opportunity to rid themselves of what he called a "sub-performing asset."
"It is going to be difficult. The only good news is that if the commodity, that is gold, keeps on going higher then those assets will have some value for somebody," he said.
African Barrick, which has four mines in Tanzania, launched Tuesday a review of its business aimed at improving its operations.
"Whilst the discussions between CNG and Barrick have not led to a transaction, the process has re-emphasised the fundamental long-term value of ABG's portfolio and the scarcity of large scale producing opportunities to enter the gold market in Africa," African Barrick chief executive Greg Hawkins said.
"We have demonstrated the ability of this business to generate significant cash flows and believe that the operational review will create the opportunity to further improve the return profile of the business."
African Barrick reported a profit of US$65.2 million or 16 cents per share on $534.5 million in revenue for the six months ended June 30, 2012. That compared with a profit of $120.1 million or 29 cents per share on $578.4 million in revenue for the first six months of 2011.
Cash costs per ounce of gold increased 43 per cent to $938, up from $655.
In addition to higher costs, African Barrick has faced other problems, including a report in May 2011 that it was investigating allegations of sexual assaults against local women at its North Mara mine in Tanzania.
Barrick said at the time that a preliminary investigation by ABG had found credible evidence of sexual assaults by members of the Tanzanian police and the company's security guards.
North Mara was also the site of deadly clashes between police and a crowd of about 800 people trying to steal ore from the mine. Seven people were killed and a dozen more were injured.
Barrick also announced Tuesday that Nathaniel Rothschild has resigned from the company's board due to other time commitments.
Rothschild had been a Barrick director since April 2010.
Barrick owns and operates gold mines in Canada, the United States, Peru, Argentina, Chile, Australia and Papua New Guinea.