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Barrick Gold Corp. is in talks to sell its Lagunas Norte gold mine in Peru with a sale announcement possible before the end of the year.
Mark Hill, chief operating officer, Latin America and Australia Pacific, with Barrick, made the comments about Lagunas on Friday during a webcast alongside executives from Randgold Resources Ltd., which Barrick is in the process of acquiring.
Earlier this year, Barrick’s executive chairman, John Thornton, said the Toronto-based gold miner intended to sell assets that weren’t strategic or tier-one and included Lagunas as an example. He defined tier-one as a property that produces at least half a million ounces of gold a year, has a life of more than 10 years and is low cost.
Lagunas is nearing the end of its life cycle, and is on track to produce around 260,000 ounces of gold this year, a steep decline from last year, when it produced almost 390,000 ounces. In its most recent quarter, Barrick took a US$405-million writedown on Lagunas.
In an interview, Kerry Smith, analyst with Haywood Securities Inc., said Lagunas could sell for about US$240-million with possible interest from Chinese buyers. Since joining Barrick a few years ago, Thornton has built up the firm’s relationships with Chinese gold companies, some of which have emerged as buyers for Barrick’s non-core assets.
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