Barrick swings to loss in Q3 as prices, production fall
Barrick Gold posted a loss in the third quarter as gold prices and output declined and costs rose.
Barrick, which has operations in countries including Peru, Chile, Argentina and the Dominican Republic, registered an US$11mn loss in Q3 compared with a US$175mn profit a year earlier, the Toronto-based company said in a statement. Revenue fell to US$1.99bn from US$2.30bn a year ago.
The company said it sold gold at US$1,274/oz and copper at US$3.05/lb, compared with US$1,333/oz gold and US$2.18/lb copper a year ago.
All-in sustaining costs rose to US$772/oz and US$2.24/lb copper in the quarter from US$704/oz gold and US$2.02/lb copper a year earlier, while total capex rose to US$296mn from US$271mn, Barrick said. The company also registered a US$172mn tax provision due to s dispute with the government of Tanzania.
Barrick slightly tightened 2017 production guidance at 5.3-5.5Moz gold, with all-in sustaining costs estimated at US$740-770/oz gold. Copper guidance is 420-440Mlb with all-in sustaining costs of US$2.20-2.40/lb.
The company said it produced 1.24Moz gold and 115Mlb copper in Q3, compared with 1.38Moz gold and 100Mlb copper a year earlier.
The Pueblo Viejo mine in the Dominican Republic produced 154,000oz of gold in Q3, down from 189,000oz a year earlier and Lagunas Norte in Peru produced 96,000oz, down from 101,000oz a year ago, while output at the Veladero mine in Argentina fell to 99,000oz from 116,000oz a year earlier.
Pueblo Viejo is forecast to produce 635,000-650,000oz gold this year, followed by Veladero (430,000-465,000oz) and Lagunas (380,000-400,000oz). The Zaldívar copper mine in Chile is expected to produce 115-125Mlb copper, according to the company. All figures refer to Barrick's equity production.
The company said it plans US$1.35-1.5bn in capex spending this year. The company, which reduced its debt by US$1.5bn this year, aims to cut debt to US$5bn by end-2018 from US$7.9bn at the start of 2017.
Projects
A feasibility study for a 6,000t/d autoclave and carbon-in-leach facility that will extend the life of the Lagunas Norte mine by a decade suggests a two-stage project, Barrick said. Construction could start at the end of 2018 pending approval of an environmental impact assessment and construction permits, with production to begin in 2020, it said.
Work is also moving ahead on a prefeasibility study for the Pascua-Lama project on the Chile-Argentina border, including a drill campaign and a design that would use a processing plant and tailings facility on the Argentine side of the border, Barrick said.
A focus on an underground project rather than open pit will reduce environmental concerns and reduce risk from severe weather in winter, it said. Barrick halted the project in 2013, citing spiraling costs, labor unrest and environmental opposition.
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