Barrick Gold Corp. is planning to sell its 50-per-cent share in the Kalgoorlie mine in Australia and has identified two Australian companies as possible buyers.
“There’s a lot of very interested parties in that asset, whether it’s Northern Star or Evolution [Mining]. Those mid-cap Aussie guys are doing extremely well,” Barrick CEO Mark Bristow said in an interview after the release of the company’s second-quarter results on Monday. Neither Northern Star nor Evolution responded to a request for comment.
After Barrick bought Randgold Resources Ltd. for US$6-billion earlier this year, the company said it intended to divest about US$1.5-billion in assets to concentrate on its highest-returning assets, such as its mines in Nevada and its massive Pueblo Viejo mine in the Dominican Republic, which needs about US$1-billion in capital expenditure over the next few years.
Kalgoorlie, in western Australia, is on track to produce about 270,000 ounces of gold this year. In the second quarter, its all-in sustaining cost was US$1,204 an ounce, making it among Barrick’s highest-cost mines.
Barrick co-owns the asset alongside Nevada-based Newmont Goldcorp Corp., the world’s biggest gold producer. Newmont is the operator, meaning Barrick has little influence in running the mine. Mr. Bristow said Barrick would rather concentrate on assets over which it has full control rather than being a passive investor.