Barrick Gold Corporation – Page 37

Barrick’s new gold discovery – by Kip Keen (April 29, 2015)

April 30, 2015

http://www.mineweb.com/

Barrick looks to have found another multi-million ounce gold deposit.

In the hands of the world’s biggest gold miner, a decent, even pretty big, gold discovery doesn’t make a lot of waves. When you churn out 6 million ounces gold or so a year you don’t get a lot of recognition for the pre-resource stuff especially. Firstly, you can’t put a dollar figure or cash flow analysis to it that carries even a faint promise of being accurate given the vagaries of deposit development – including unclear tonnage and grade, metallurgical questions, infrastructure issues, potential people problems, and permitting, and so on.

The list goes on. And secondly, for a Barrick, with fairly deep gold reserves already, and yet also a high rate of reserve depletion, absolutely speaking, it’s both hard to impress the market and to keep up with reserve replacement even with new discoveries. You’re mostly measured by your best existing and operating mines, not potential greenshoots in the field. Fair enough.

But still. Gold discoveries, especially of multi-million ounce deposits, with early indications they may work as a mine, are pretty damn rare. So it’s hard not to at least give kudos when they’re made. Barrick deserves some this week. A couple days back Barrick reported first drilling results on its Alturas project in Chile. It’s clearly shaping up to be one of the larger gold discoveries in recent years.

Barrick to revamp executives’ pay after shareholder backlash – by Lisa Wright (Toronto Star – April 29, 2015)

April 29, 2015

The Toronto Star has the largest circulation in Canada. The paper has an enormous impact on federal and Ontario politics as well as shaping public opinion.

John Thornton told the company’s annual shareholder meeting that 75% of the votes were cast against compensation scheme.

Embattled Barrick Gold Corp. chairman John Thornton has promised to overhaul the miner’s controversial executive compensation system that hiked his pay by 35 per cent to $12.9 million (U.S.).

But at the annual meeting Tuesday, where shareholders voted overwhelmingly against executive salary increases, Thornton didn’t offer to hand any of it back, underscoring that he is personally tied to the future fortunes of the company since he bought half of his 1.4 million Barrick shares “with my own money.”

“We have heard you loud and clear,” he said, after early returns suggested 75 per cent of shareholders did not support the pay packages.

“We take that feedback and we will go back and reform our system – and specifically how it relates to me,” Thornton assured the investor audience at the Metro Toronto Convention Centre.

Corporate harassment, from exec compensation to diversity – by Terence Corcoran (National Post – April 28, 2015)

April 28, 2015

The National Post is Canada’s second largest national paper.

Annual shareholder meetings of major corporations have never been of much practical use to investors. Certain legal requirements are fulfilled, the CEO reviews the corporation’s affairs with great flair or thudding dullness, depending on personality. Questions are taken from shareholders, results of proxy votes announced, and then the chair invites everyone for light refreshments before declaring the meeting terminated.

That still happens, but meetings have also recently been hijacked by corporate governance activists who have turned many annual shareholder events into meaningless ideological skirmishes. First it was executive compensation issues, but diversity is rising fast through the activist network of corporate harassment.

The CIBC annual meeting last week in Calgary turned into a spring against the bank’s executive compensation regime, particularly money paid to former CEO Gerald McCaughey and former COO Richard Nesbitt. As part of the now mandatory but non-binding “say-on-pay” resolution, shareholders voted 57 per cent to 43 per cent against the bank’s approach to executive compensation.

Rebellion fever runs high in anticipation of the Barrick Gold annual meeting in Toronto Tuesday. A large say-on-pay vote against the corporation is expected, mostly from the government-backed institutional pension industry that has decided it doesn’t like the pay Barrick has awarded John Thornton, the man who succeeded Peter Munk as chair of the company.

Gold sector CEO pay is through the roof – and it’s embarrassing – by Tim Kiladze (Globe and Mail – April 28, 2015)

April 28, 2015

The Globe and Mail is Canada’s national newspaper with the second largest broadsheet circulation in the country. It has enormous influence on Canada’s political and business elite.

Someone needs to break the bad news to gold miners: their party’s all but over. If they keep paying their chief executives handsomely, there’s no chance they’ll win back the global investors they sought for so long.

After peaking in 2011, the S&P/TSX Gold Index has been decimated, losing 63 per cent of its value. Miraculously, though, boards of directors have barely noticed. Which is why, even after tens of billions of dollars worth of writedowns and rounds of executive upheaval, the gold sector’s chief executives still get paid through the roof.

Barrick Gold Corp. is feeling the heat. Despite a share price that plunged by nearly one-third in 2014 – Barrick’s stock now trades at $15.52, a level not seen since last century – chairman John Thornton was handed a 36 per cent pay bump, bringing his total compensation to $12.9-million (U.S.).

If only it ended there. Barrick’s in the spotlight, but many of its rivals, such as Eldorado Gold Corp. and Yamana Gold Inc., are in the same boat.

Barrick to sell part of Chilean mine in retreat from copper – by Rachelle Younglai (Globe and Mail – April 28, 2015)

April 28, 2015

The Globe and Mail is Canada’s national newspaper with the second largest broadsheet circulation in the country. It has enormous influence on Canada’s political and business elite.

Barrick Gold Corp. plans to sell part of its prized Chilean copper mine, in a move to reduce its $13-billion (U.S.) debt burden. The partial sale of Zalidvar will crimp Barrick’s cash flow at a time when it is dealing with a slump in copper and gold prices.

But Zaldivar, which used to be called the Andean ATM because it generated so much cash, is expected to attract top bids and help Barrick strengthen its finances under a revitalization plan laid out by chairman John Thornton.

“Potential buyers have expressed a strong interest,” Barrick said in a statement announcing its quarterly results.

The world’s biggest gold producer plans to cut its debt by $3-billion this year and said “no priority is more important than restoring our balance sheet.” The Toronto company has already put its Australian and Papua New Guinea mines up for sale. The partial sale of Zaldivar is a major step away from the copper business for Barrick.

The miner had tried to diversify further into copper with its ill-timed $7-billion acquisition of copper company Equinox Minerals, a purchase that it has written down completely and helped create Barrick’s debt problems.

Barrick Gold faces shareholder wrath over pay hikes at annual meeting Tuesday – by Lisa Wright (Toronto Star – April 27, 2015)

April 27, 2015

The Toronto Star has the largest circulation in Canada. The paper has an enormous impact on federal and Ontario politics as well as shaping public opinion.

Toronto-based mining giant’s board of directors in hot water over ‘exorbitant’ executive compensation plan.

Barrick Gold Corp. is in for a showdown Tuesday at its annual meeting in Toronto amid investor blowback over its controversial executive pay scheme that includes a 35 per cent salary hike for its board chairman.

The Canada Pension Plan Investment Board, the country’s largest pension fund manager, joined three other big pension funds Friday in saying it too will vote against the Toronto mining giant’s executive compensation plan awarding John Thornton $12.9 million.

The CPP Investment Board also said it plans to withhold support from Brett Harvey, one of Barrick’s board members and the chair of its compensation committee, which approved the 2014 pay hikes for Barrick’s top brass in a year when shares plunged 33 per cent and the miner lost $2.91 billion.

“We continue to be concerned with the company’s practice of granting outsized awards on a largely discretionary basis, which we believe is inconsistent with the governance principle of pay-for-performance,” said the CPPIB in a statement.

UPDATE 3-Barrick will not suspend copper mine as Zambia backs down on royalties – by Chris Mfula (Reuters U.S. – April 23, 2015)

April 24, 2015

http://www.reuters.com/

LUSAKA, April 23 (Reuters) – Barrick Gold Corp, the world’s biggest gold producer, said on Thursday it will not suspend operations at its Lumwana open-pit copper mine in Zambia now that the country’s government has reduced mining royalties.

Zambia’s cabinet set the royalty tax rate for open-pit and underground mining at 9 percent on Monday. The corporate income tax rate will be 30 percent and the mineral processing tax rate will be 35 percent when the law takes effect on July 1.

“We appreciate the leadership and engagement of President (Edgar) Lungu and the government of Zambia on this matter,” Barrick Co-President Kelvin Dushinsky in a statement. “While Lumwana still faces challenges, in light of the government’s recent announcement we intend to continue operations at this time” The changes are yet to be approved by the parliament in Africa’s second-largest copper producer, but are expected to receive support from the assembly.

Zambia decided in January to increase royalties for open pit mines to 20 percent from 6 percent and raise rates for underground mines to 8 percent from 6 percent. The move rattled unions and mining companies and forced the government to review the plan.

Company Document: Barrick’s new compensation plan rewards long-term performance

April 24, 2015

http://www.barrick.com/

ISS and Glass Lewis have recommended voting against Barrick’s Say on Pay proposal. We have received considerable support for our compensation system in other quarters, and we want to explain the system in general and the way in which we apply it to the Executive Chairman’s compensation in particular.

Barrick’s new leadership has designed a compensation system that restores the culture that drove the company’s initial success and ensures a focus on creating long-term value. We talked to current long-term owners and companies outside of our peer group. We weighed the critique of short-term stock-based compensation by influential author and former dean of the Rotman School of Management, Roger Martin, in his groundbreaking work Fixing the Game.

We considered McKinsey & Company’s finding that more than 50% of a typical company’s value is created by activities that will take place three or more years in the future. And we considered the findings of a recent survey in the Financial Analysts Journal that reported 78% of executives would improve quarterly earnings even if their actions destroyed long-term value. As Dominic Barton and Mark Wiseman, two of Canada’s most respected business leaders on the world stage, recently argued in the Financial Times:

“The biggest financial rewards should be reserved for managers who deliver long-term value, not just a quick pop in the stock.” They noted that on average, 74% of fund managers are compensated in cash, tied to outperforming an annual stock market benchmark.

UPDATE 2-CPPIB joins chorus against Barrick’s executive pay structure – by Euan Rocha (Reuters U.S. – April 24, 2015)

April 24, 2015

http://www.reuters.com/

(Reuters) – The Canada Pension Plan Investment Board, the country’s largest pension fund manager, on Friday joined other investors opposing Barrick Gold Corp’s executive compensation schemes, arguing the company’s pay awards were “outsize” and unrelated to performance.

Toronto-based CPPIB said it plans to come out against the advisory vote on executive compensation that Barrick will be having at its annual shareholder meeting next week.

It also said it plans to withhold support from Brett Harvey, one of Barrick’s board members and the chair of its compensation committee. CPPIB own roughly 8.1 million Barrick shares, or less than a percent of the company’s outstanding stock.

Last week, two smaller Canadian pension funds, the British Columbia Investment Management Corp (BCIMC) and the Ontario Teachers’ Pension Plan Board, said they plan to withhold support from Barrick’s entire board in light of their concerns with Barrick’s executive compensation package.

Barrick shareholders urged to vote ‘no’ on John Thornton’s ‘excessive’ pay – by Rachelle Younglai (Globe and Mail – April 10, 2015)

April 10, 2015

The Globe and Mail is Canada’s national newspaper with the second largest broadsheet circulation in the country. It has enormous influence on Canada’s political and business elite.

An influential proxy adviser urged shareholders to oppose Barrick Gold Corp.’s compensation plans, saying it has concerns about chairman John Thornton’s “exorbitant” pay package.

Barrick increased Mr. Thornton’s compensation 36 per cent to $12.9-million (U.S.) for last year, citing his plans to improve the miner’s performance by slashing debt and focusing on its gold assets in the Americas.

“It comes as a considerable surprise that the company has once again decided to reward Mr. Thornton with such a generous pay package,” Glass Lewis & Co. said in a note released ahead of the miner’s annual meeting April 28. “We … consider the ongoing compensation arrangement with its chairman to be excessive and extremely risky, particularly given the company’s track record of exorbitant pay packages for Mr. Thornton,” Glass Lewis said.

A key Barrick shareholder agreed Mr. Thornton’s compensation was inappropriate. “I don’t know why he couldn’t freeze his salary,” said Seymour Schulich, a prominent Canadian businessman who owns 15-million shares of Barrick.

Taking a closer look at mining’s economic impact in Elko, Nevada (Barrick Beyond Borders – April 08, 2015)

April 8, 2015

http://barrickbeyondborders.com/

There are 670 mining vendors in Elko County alone, according to the Nevada Mining Association. At 53,000, the county’s population has climbed 7.5 percent since 2010 and 15 percent since 2002. Between 2003 and 2013, the gold-mining industry added 3,600 jobs across Elko, Lander, White Pine and Eureka Counties. Another 1,360 mine industry support jobs were added during the same period.

According to the U.S. Bureau of Labor Statistics, Nevada’s unemployment rate is 7.1 percent as of October 2014. According to the same source, Elko County’s unemployment rate is 4.4 percent as of September 2014, down from 6.3 percent in February of 2014.

Below are a few vignettes that offer snapshots of mining’s impact in this Nevada community.

A carnival-like atmosphere

A new store opening isn’t a major event in big cities, but it is in rural America. So when a Jo-Ann Fabrics opened in Elko in late 2011, the local radio and television stations were both on hand to cover the event and so, it seemed, was half the population of northeast Nevada. That may be a slight exaggeration. But the new Jo-Ann’s in the Elko Junction Shopping Center did enjoy the largest grand opening in the history of the company. Within two months, a Rue21 and Famous Footwear had opened at Elko Junction and also reported record grand openings.

Barrick open to sell-offs and joint ventures in debt drive – by James Wilson (Financial Times – April 5, 2015)

April 8, 2015

http://www.ft.com/intl/companies/mining

Barrick Gold is open to a wide range of asset sales and joint ventures as it tries to cut debt by $3bn and rebuild its reputation with investors, its chairman has told the Financial Times.

In his first interview since taking over as chairman almost 12 months ago, John Thornton, pictured below, said he could imagine Barrick ceding operational control of some assets — for example to Mick Davis, the former Xstrata chief executive who plans to re-enter the mining sector at the head of a private equity vehicle.

Barrick would also bring long-term investors into a group of its mines as minority partners, Mr Thornton said.

“There is a lot of incoming inquiries . . . of all kinds of stripes and sizes. We feel confident about hitting the $3bn number,” he said.

Mr Thornton’s comments show the range of options being considered to turn round Barrick, still the world’s largest gold miner by volume but one of the worst-performing large miners of the past two years. Barrick, which has a $13bn market capitalisation, has been hit by steep falls in the price of the precious metal and has suffered billions of dollars of writedowns since 2012 on poor acquisitions and stalled projects.

Barrick Gold hires John Baird, Newt Gingrich – by Rachelle Younglai (Globe and Mail – March 27, 2015)

March 30, 2015

The Globe and Mail is Canada’s national newspaper with the second largest broadsheet circulation in the country. It has enormous influence on Canada’s political and business elite.

Barrick Gold Corp. has tapped former foreign affairs minister John Baird and former top U.S. lawmaker Newt Gingrich to serve on its advisory board, the company said in regulatory filings.

Mr. Baird and Mr. Gingrich, a former Republican speaker of the U.S. House of Representatives, will join other political heavyweights including former Canadian Prime Minister Brian Mulroney on the miner’s international advisory board.

The board meets once a year and gives advice to the world’s biggest gold producer, which has operations in the Americas, Africa and Australia.

“The role of the board is to provide advice on geopolitical and other strategic issues that affect our business,” a company spokesman said. “Both Mr. Baird and Mr. Gingrich bring with them excellent credentials and experience in this regard,” he said. Mr. Mulroney chairs the board, which also includes former U.S. and German defense officials and a former prime minister of Spain.

No compensation details for Mr. Baird and Mr. Gingrich were disclosed in the filings.

[Barrick Gold] Unprecedented sage grouse protection deal signed in Nevada – by Scott Sonner (Washington Times – March 26, 2015)

March 27, 2015

http://www.washingtontimes.com/

Associated Press – RENO, Nev. – An unprecedented attempt to protect sage grouse habitat across parts of more than 900 square miles of privately owned land in Nevada will begin under a deal Thursday involving the federal government, an environmental group and the world’s largest gold mining company.

The agreement comes as the U.S. Fish and Wildlife Service approaches a fall deadline for a decision on whether to protect the greater sage grouse, a bird roughly the size of a chicken that ranges across the West, under the Endangered Species Act.

Commercial operations, including mining companies and oil and gas producers, are entering into such deals in an effort to keep the bird off the threatened or endangered list because the classification would place new restrictions on their work.

The deal involves Barrick Gold Corp., The Nature Conservancy and the U.S. Interior Department’s Bureau of Land Management and Fish and Wildlife Service. It establishes a “conservation bank,” providing the mining firm credit for enhancing critical habitat, in exchange for flexibility in future operations. It aims to preserve and restore more habitat than is lost through development while at the same time providing Barrick with more certainty as it maps out new mining plans.

“This is the kind of creative, voluntary partnership that we need to help conserve the greater sage grouse, while sustaining important economic activities on western rangelands,” Interior Secretary Sally Jewell said.

Barrick Gold Mints 35 Partners as It Seeks Revitalization – by Liezell Hill (Bloomberg News – March 26, 2015)

March 27, 2015

http://www.bloomberg.com/

(Bloomberg) — Barrick Gold Corp. Executive Chairman John Thornton wants his executives to have skin in the game. To do that, he’s rolling out a Wall Street-style partnership to give them significant stakes in the world’s largest gold producer.

Barrick this month named its inaugural 35 partners, a group that includes mine managers as well as the most senior officers at its Toronto headquarters, according an internal memo obtained by Bloomberg.

Partners will receive long-term incentive-based pay in the form of restricted stock that can’t be sold until retirement or departure. The shares will comprise more than 50 percent of total compensation for the six most senior executives in the partnership if targets are met, and after five years all the partners will be required to hold stock worth multiples their base salaries, according to Andy Lloyd, a Barrick spokesman.

A partnership model is something more typically associated with financial services, according to Steve Chan, a consultant who advises on corporate pay. Its adoption by Thornton, a one-time senior banker at Goldman Sachs Group Inc., is indicative of his intentions to return Barrick to its entrepreneurial roots after becoming weighed down by debt amid falling gold prices.