Barrick Gold Corporation – Page 39

Editorial: Top stories of 2014 – by John Cumming (Northern Miner – December 22, 2014)

December 22, 2014

The Northern Miner, first published in 1915, during the Cobalt Silver Rush, is considered Canada’s leading authority on the mining industry. Editor John Cumming MSc (Geol) is one of the country’s most well respected mining journalists. jcumming@northernminer.com

Mining and mineral exploration are by nature businesses for optimists, but looking back over 2014, it’s hard not to conclude that difficulties and disasters tended to outweigh the brighter spots of achievement and growth. Here is our choice of the top stories of 2014:

10. Peter Munk’s exit — One of the giants of Canadian mining took his final bow in the mining world in April 2014, as Barrick Gold founder and chairman Peter Munk delivered his last address to shareholders at the company’s annual meeting. Having played a pivotal role in growing Barrick from modest beginnings to the world’s No. 1 gold producer, Munk’s reputation as a company builder is secured. As the year progressed, Barrick saw a major turnover in top management.

9. Rise of the house of Lundin — While other miners focused on cutbacks, the Lundin Group of Companies was a mine developer and bargain hunter. On top of financing numerous struggling juniors, the Lundin group piled up successes such as Lundin Mining’s start-up of its Eagle mine in Michigan and purchase of the Candelaria mine from Freeport-McMoRan; Fortress Minerals’ purchase of Kinross Gold’s Fruta del Norte project; and Lucara’s continued success in diamonds.

8. Crises in West Africa — A favourite destination for junior gold miners had a deadly year marked by an outbreak of Ebola that killed 7,300 people in Sierra Leone, Liberia and Guinea.

Tax hike, copper prices force Barrick to shutter Zambian mine – by Rachelle Younglai (Globe and Mail – December 19, 2014)

December 19, 2014

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. said it will suspend operations at its Zambian copper mine and record an impairment charge after the African country’s government more than tripled its mining royalties.

The suspension is the latest setback for Barrick, which borrowed heavily to acquire the Lumwana mine in 2011, when copper prices were soaring.

The royalty on open pit mining in Zambia will jump to 20 per cent from the current 6 per cent, under a new law that will go into effect Jan.1.

“The introduction of this royalty has left us with no choice but to initiate the process of suspending operations at Lumwana,” Barrick’s co-president Kelvin Dushnisky said in a statement.

Barrick, which employs 4,000 workers at Lumwana, said it would start cutting jobs in March after giving the Zambian government the mandatory two-months notice. The mine will be idled by the middle of the year.

It is unknown whether Barrick will be able to renegotiate rates with the government before it shutters the mine.

NEWS RELEASE: Barrick to Suspend Operations at Lumwana Following Passage of New Mining Royalty

December 18, 2014

TORONTO, ONTARIO–(Marketwired – Dec. 18, 2014) – Barrick Gold Corporation (NYSE:ABX)(TSX:ABX) today announced that the company will initiate procedures to suspend operations at the Lumwana copper mine in Zambia following the passage of legislation that raises the royalty rate on the country’s open pit mining operations from six percent to 20 percent.

The new taxation regime, which is expected to go into effect on January 1, 2015, eliminates corporate income tax, but imposes a 20 percent gross royalty on revenue without any consideration of profitability.

“The introduction of this royalty has left us with no choice but to initiate the process of suspending operations at Lumwana. Despite the progress we have made to reduce costs and improve efficiency at the mine, the economics of an operation such as Lumwana cannot support a 20 percent gross royalty, particularly in the current copper price environment,” said Co-President Kelvin Dushnisky .

“We sincerely regret the impact this will have on our people, as well as the communities and the businesses that depend on Lumwana, and we remain hopeful that the government will consider an alternative solution that will allow the mine to continue operating,” said Co-President Jim Gowans .

In the meantime, the company will initiate procedures to transition Lumwana to care and maintenance. Major workforce reductions are planned to commence in March, following the legally required notice period.

Barrick Gold considers asset sales – by James Wilson (Financial Times – November 27, 2014)

November 27, 2014

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

Barrick Gold is open to selling a wide range of assets as the world’s largest gold miner by output tries to cut its debts after a sharp fall in the gold price, according to one of its most senior executives.

However, co-president Kelvin Dushnisky said Barrick would not sell at any cost and made clear the miner was placing faith in a reshuffled management team and the productivity of its largest mines to try to ride out the storm engulfing the sector.

Gold miners across the world are eyeing more cost-cutting and restructuring after the price of the precious metal sank to four-year lows below $1,200 per ounce this month, leaving some companies haemorrhaging cash and investor support. Barrick’s share price has retreated to levels last seen two decades ago.

The gold price fall – from $1,900/oz in 2011 – has left many miners with lossmaking operations and sparked expectations of consolidation in the sector. This year Barrick and Newmont Mining, the second-largest producer, aborted advanced talks on a potential merger.

While many analysts have speculated that Barrick could return to talks with its US rival, Mr Dushnisky said discussions were “off the table”. He also accepted that Barrick would have little investor backing to try to acquire more mines from struggling rivals.

UPDATE 1-Former African Barrick Gold to go underground at North Mara – by Roshni Menon (Reuters India – November 27, 2014)

November 27, 2014

http://in.reuters.com/

Nov 27 (Reuters) – Acacia Mining Ltd, formerly African Barrick Gold Plc, said on Thursday it planned to start underground mining at its North Mara mine in Tanzania in the first half of 2015.

The open pit North Mara mine has a chequered past, with villagers illegally entering the site to scour tailings that may contain small quantities of gold, and some have been killed or injured by mine security guards and police.

“The North Mara decision to go underground … minimises our impact on the community, reduces the opportunity for illegal miners to enter that operation, and reduces our footprint with respect to needing land to dump waste,” Chief Executive Brad Gordon told Reuters on Thursday.

Acacia has been cutting mining costs, reducing its workforce and increasing output to counter the sharp drop in gold prices that has forced many gold and silver miners to shelve projects.

The company, unveiling its long-term strategy at an investor meeting in London, said the underground expansion was expected to produce 450,000 ounces of gold over a five-year mine life at an all-in sustaining cost (AISC) of under $750 per ounce.

NEWS RELEASE: Barrick Appoints Executive Project Director for Pascua-Lama

November 13, 2014

TORONTO, November 13, 2014 — Barrick Gold Corporation (NYSE:ABX)(TSX:ABX) (Barrick or the “company”) today announced the appointment of Sergio Fuentes as Executive Project Director for Pascua-Lama. Mr. Fuentes was most recently Vice President, Projects for Codelco and has nearly 30 years of mining industry experience, with a proven track record of engineering, optimizing and constructing complex mining projects, including high-altitude operations in the Andes.

As Executive Project Director, Mr. Fuentes will focus on optimizing detailed engineering, improving the project’s economics and developing a robust execution plan for remaining construction activities at Pascua-Lama. He will work with the project leadership team to advance Pascua-Lama in an environmentally responsible manner, in compliance with legal and regulatory requirements. In the short term, he will lead the completion of final engineering for the water management system in Chile and will work to reduce ongoing care and maintenance expenditures at the project.

Mr. Fuentes will work closely with Eduardo Flores, Executive Director, Chile and Guillermo Calo, Executive Director, Argentina to ensure alignment of all project activities in both Chile and Argentina and will support the development of enduring partnerships with governments, communities and other stakeholders in both countries.

A decision to restart the Pascua-Lama project will depend on resolution of permitting and legal matters in Chile and improved project economics. The company will only proceed with construction if the project meets minimum return-on-investment thresholds.

Barrick faces new setback over Zambia mine – by Rachelle Younglai (Globe and Mail – October 31, 2014)

October 31, 2014

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. may idle its Zambian copper mine if the African government imposes a higher royalty, a potential blow to the Canadian company, which has worked hard to turn its fortunes around.

The world’s largest gold producer was in discussions with the government about reducing the proposed 20-per-cent rate when the Zambian president died this week, adding more uncertainty to the negotiations.

“At the end of the day if we are in a position where through a new tax regime the project doesn’t make money, then certainly we would have to consider suspending for a period of time,” Kelvin Dushnisky, Barrick’s co-president, said in an interview. “The copper remains in the ground. It’s not going anywhere. It wouldn’t make sense for us to run the mine just for the purpose of paying royalties and taxes.”

It’s another sign that the challenges are not over for Barrick, which like the rest of the gold industry continues to grapple with the fallout from weaker gold prices and expensive acquisitions gone wrong.

“The gold producers are stuck between a rock and a hard place,” said Pawel Rajszel, analyst with Veritas Investment Research. “There’s just not much the gold producers can do, except hope for a higher gold price.”

UPDATE 1-Zambia may be backing off steeper mine royalty rates -Barrick – by Nicole Mordant (Reuters India – October 30, 2014)

October 30, 2014

http://in.reuters.com/

Oct 30 (Reuters) – There are indications Zambia may be backing away from plans to impose a 20 percent royalty rate on open pit mining in the country, a top executive with Barrick Gold Corp said on Thursday.

Zambia’s Finance Minister Alexander Chikwanda rattled mining companies with investments in the copper-rich southern African country earlier this month when he announced that from January royalties on open pit mines will rise to 20 percent and on underground mines to 8 percent from 6 percent currently.

Barrick, which is the world’s biggest gold producer but also owns the Lumwana copper mine in Zambia, has said that a 20 percent royalty would seriously challenge the economics of the large open-pit mine.

“Our sense is that the government realizes that the numbers they have imposed will be very challenging for the industry,” Barrick co-president Kelvin Dushnisky said on a conference call to discuss the company’s third-quarter results, which were released late on Wednesday and beat market expectations.

“I don’t want to handicap anything, but going into this week, our sense is there would be movement away from that number. I can’t guarantee it but that’s certainly the direction discussions were going,” he said.

Barrick Gold Trims Cost Forecast After Expenses Drop – by Liezel Hill (Bloomberg News – October 30, 2014)

October 30, 2014

http://www.bloomberg.com/

Barrick Gold Corp. (ABX), the largest producer of the precious metal, reduced its forecast for operating costs this year after reporting third-quarter expenses that beat analysts’ estimates.

So-called all-in sustaining costs will be $880 to $920 an ounce, compared with a previous range of $900 to $940, Toronto-based Barrick said yesterday in its third-quarter earnings statement.

Barrick is among gold producers that have reined in spending and delayed growth plans after the metal’s 28 percent decline last year. Third-quarter costs fell 8.8 percent to $834 an ounce, compared with the $916 average of three estimates.

“Their earnings look reasonably good, the cash costs are good, the guidance looks good,” David Christensen, chief executive officer of San Mateo, California-based ASA Gold & Precious Metals Ltd., said in a phone interview. His company manages $250 million including Barrick shares. “All in all, it looks like they’ve done a good job.”

Earnings excluding one-time items were 19 cents a share, topping the 17-cent average of 23 estimates compiled by Bloomberg. Sales declined 13 percent to $2.6 billion, exceeding the $2.49 billion average estimate.

‘Please tell people about this:’ London students’ horror at Dominican Republic mines – by Mark Spowart (Metro News – October 27, 2014)

October 27, 2014

http://metronews.ca/

Three London students were shocked by what they found last winter during a trip to the Dominican Republic. Canadian mining companies, they say, are destroying lives in the country.

“We visited the Barrick Gold mine, and while we were there, we spoke with a woman named Juliana (Rodriguez). She is 82 years old and has lived in the area for all of her life,” Klaire Gain said. “She told us the last four years, which (has seen) Barrick Gold mining in the region, have been the worst years of her life.”

Now, Gain, Claire Morrow and Natasha Jimenez — all recent graduates of the social justice and peace program at King’s University College — are working to show the world what they witnessed. Using their own money, and some brought in through fundraisers, the trio travelled back to the region this summer.

They spent two months living in the area, working on farming co-ops, meeting and talking with as many residents, along with environmental and academic experts, as they could. They also hired former CBC cameraman Mark Visser, and flew him to the region where he filmed more than 100 hours of footage for a documentary expected to be ready by spring 2015.

UPDATE 2-African Barrick tightens full-year costs target – by Roshni Menon (Reuters India – October 23, 2014)

October 23, 2014

http://in.reuters.com/

Oct 23 (Reuters) – African Barrick Gold Plc tightened its costs target for the full year as it increased output while also cutting jobs to beat the sharp drop in gold prices.

The miner reported a fall in overall expenses for an eighth successive quarter after it cut more than 500 jobs at its flagship Bulyanhulu mine in Tanzania in the third quarter ended Sept. 30.

African Barrick’s stock was among the top percentage gainers on the FTSE-250 Midcap Index on Thursday, rising as much as 4.8 percent in early trading.

To beat shrinking gold prices, African Barrick has been accelerating production at Bulyanhulu, the largest of its three operating mines in Tanzania, by increasing its use of technology.

Many gold and silver miners were forced to shelve new projects and slash costs last year after prices of precious metals fell to their lowest in a decade. Gold fell 28 percent and silver plunged 36 percent in 2013. “By the end of next year we expect Bulyanhulu to produce 350,000 ounces at $900 per ounce,” Chief Executive Bradley Gordon told Reuters.

[Nevada] State needs to extract more taxes from mining – by Bob Fulkerson (Las Vegas Review-Journal – October 12, 2014)

October 14, 2014

http://www.reviewjournal.com/

On Nov. 4, Nevada voters will decide whether to remove mining’s unique, 150-year-old tax protections from the state constitution and allow the Legislature to update the mining tax system to reflect modern times. Passage of Question 2 won’t raise or lower the taxes that mining pays. But it will remove the special protection that no other industry in our state enjoys.

Nevada’s mining taxes are nearly nonexistent compared with the rest of the world, and we are one of three states with no corporate profits tax to help pay for the services that benefit those corporations. Billions of dollars of mineral wealth has been extracted here; the vast majority has been exported. It’s been that way since statehood, when gold and silver from the Comstock built San Francisco and the Pacific Stock Exchange.

Nevada is the No. 1 gold producer in the United States and one of the top five gold producers in the world. Mining corporations account for 98 percent of toxic chemicals released in Nevada, according to the Environmental Protection Agency, and a single gold ring leaves in its wake, on average, 20 tons of mine waste. The average gold mine uses enough water to provide the basic water needs for a population equivalent to that of a large American city for a year.

In 2011, the laundry list of deductions, coupled with the fact that the mining companies had rarely, if ever, been audited by the state, came to light during hearings.

NEWS RELEASE: Barrick Named the Exclusive Provider of Gold, Silver and Bronze for the Medals at Toronto 2015 Pan Am/Parapan Games

September 30, 2014

TORONTO, September 29, 2014 – Barrick Gold Corporation is joining the TORONTO 2015 Pan Am/Parapan Am Games as its Official Metal Supplier. Toronto-based Barrick (NYSE:ABX) (TSX:ABX) will supply all the raw materials used to make the more than 4,000 gold, silver and bronze medals awarded at the Games.

Just like the athletes coming to the Games, the metal for their medals will come from the Pan American region. The metals will be sourced from Barrick mines throughout the Americas.

“Barrick is a proud Canadian company with operations around the globe, including six Pan American countries,” said Barrick Co-President Kelvin Dushnisky. “With the 2015 Pan Am and Parapan Games being held in our hometown of Toronto, we saw a rare opportunity to do something that symbolizes our pride in our heritage and our commitment to our host countries. We look forward to welcoming the athletes and government representatives to Toronto next summer.”

“Barrick and all of its people are excited to supply the metals that will become the treasured symbols of the dedication, teamwork and excellence that will be on display in Toronto at the Games,” said Barrick Co-President Jim Gowans. “These are values we share at Barrick and try to live every day. Next summer’s Games will be a great opportunity to bring the Americas together, celebrate our shared values and learn from our differences, all while enjoying more than three weeks of athletic excellence.”

The Games are a high-profile event that will attract interest from around the world, including up to 380 million viewers across the Americas alone.