Barrick Gold Corporation (NYSE:GOLD)(TSX:ABX) – The groundbreaking
partnership agreement between Barrick, the federal government of
Pakistan and the provincial government of Balochistan should unlock
the enormous value of Reko Diq, one of the world’s largest
undeveloped copper and gold deposits, president and chief executive
Mark Bristow said today.
Speaking on an investor call, Bristow said the
project represented a unique mining opportunity, which would be a
major addition to Barrick’s Tier One1 asset base, while also
bringing significant economic and social benefits to Pakistan and
Balochistan.
The agreement in principle recently reached
between the parties provides for the reconstitution and restart of
the project, which has been on hold since 2011. It will be operated
and owned 50% by Barrick, 25% by Pakistani state-owned enterprises
and 25% by the government of Balochistan. The company has similar
partnerships in other countries which have proved to be catalysts
in developing local economies.
Bristow said following the finalization of the
underlying agreements, legalization and closing, Barrick would
update the 2010 feasibility study.
“Reko Diq’s fundamentals have not changed
materially since then. Subject to the updated feasibility, it is
still envisaged as a conventional open pit and milling operation
producing a high-quality copper-gold concentrate. We are planning a
two-phase construction approach, starting with an approximately 40
million tonne per annum plant, which could be doubled within five
years. The staged development will optimize returns, manage upfront
capital, lower execution risk and bring forward production and cash
flows in the long run. If all goes according to plan, we anticipate
first production in five to six years’ time,” he said.
“Offering a unique combination of large scale,
low strip and good grade, Reko Diq will be a multi-generational
mine, with a life of at least 40 years. The contemplated mine plan
is based on four porphyry deposits within our land package and our
exploration licence area holds additional deposits with future
upside potential.”
Noting that since 2010 there had been
game-changing technological advances in renewable energy
alternatives, some of which are particularly well-suited to the
area, Bristow said a Barrick team was already assessing various
solar, wind and battery configurations to maximize the mine’s
renewable power generation. This could also deliver a range of
economic and operational benefits.
The development of Reko Diq will make
Balochistan the largest recipient of foreign investment in
Pakistan. During peak construction periods, the project is expected
to employ 7,500 people and once in production will create about
4,000 long-term jobs. Barrick’s policy of prioritizing local
employment and suppliers will have a positive downstream impact on
the local economy.
“At Barrick we know that our long-term success
depends on sharing the benefits we create equitably with our host
governments and communities. That’s why we wanted Balochistan’s
share of the venture to be fully funded, 10% by the project and 15%
by the government of Pakistan. It’s equally important to us that
Balochistan and its people should see the benefits from day one.
Even before construction begins, we will be implementing a range of
social development programs, supported by upfront commitments to
the development of the skills required for mining, the improvement
of education, healthcare, food security and, importantly, access to
potable water in a region where the groundwater has a high saline
content,” Bristow said.
Enquiries:
Kathy du PlessisInvestor and Media Relations+44
20 7557 7738Email: barrick@dpapr.com
Website: www.barrick.com
Notes
- A Tier One Gold Asset is an asset
with a reserve potential to deliver a minimum 10-year life, annual
production of at least 500,000 ounces of gold and total cash costs
per ounce over the mine life that are in the lower half of the
industry cost curve. A Tier One Copper Asset is an
asset with a reserve potential of greater than five million tonnes
of contained copper and C1 cash costs per pound over the mine life
that are in the lower half of the industry cost curve.
Cautionary Statement on Forward-Looking
Information:
Certain information contained or incorporated by
reference in this press release, including any information as to
our strategy, projects, plans or future financial or operating
performance, constitutes “forward-looking statements”. All
statements, other than statements of historical fact, are
forward-looking statements. The words “partnership”, “framework”,
“unlock”, “opportunity,” “bring”, “catalyst”, “plan”, “optimize”,
“anticipate”, “contemplate”, “proposed”, “work towards”, “expect”,
“will”, “would”, “could”, “should”, “intend”, “future”,
“commitment” and similar expressions identify forward-looking
statements. In particular, this press release contains
forward-looking statements including, without limitation, with
respect to: the planned updating of the historical Reko Diq
feasibility study; the future construction, development and
operation of the Reko Diq project, including the anticipated
benefits of a two phased approach and timeline for construction;
the future ownership of the Reko Diq project; the future financing
of the Reko Diq project; the proposed fiscal and governance terms
applicable to the Reko Diq project and the joint venture through
which it is held; the timeline and process for the execution and
legalization of definitive agreements and the reconstitution of a
joint venture to carry out the future development and operation of
the Reko Diq project; the contemplated life of mine of the Reko Diq
project and the potential for additional exploration upside in the
license area; potential advances in renewable energy alternatives
and their suitability for the Reko Diq site; the anticipated
sharing the benefits from the Reko Diq project with Barrick’s host
governments and communities including social development and public
health programs as well as potential levels of local employment
during project construction and operation; and expectations
regarding financial performance and other outlook or
guidance.Forward-looking statements are necessarily based upon a
number of estimates and assumptions including material estimates
and assumptions related to the factors set forth below that, while
considered reasonable by Barrick as at the date of this press
release in light of management’s experience and perception of
current conditions and expected developments, are inherently
subject to significant business, economic and competitive
uncertainties and contingencies. Known and unknown factors could
cause actual results to differ materially from those projected in
the forward-looking statements and undue reliance should not be
placed on such statements and information. Such factors include,
but are not limited to: fluctuations in the spot and forward price
of gold, copper or certain other commodities (such as silver,
diesel fuel, natural gas and electricity); the speculative nature
of mineral exploration and development; changes in mineral
production performance, exploitation and exploration successes;
risks associated with projects in the early stages of evaluation
and development and for which additional technical, engineering and
other analysis is required; disruption of supply routes which may
cause delays in development, construction and mining activities;
diminishing quantities or grades of reserves; increased costs,
delays, suspensions and technical challenges associated with the
construction of capital projects; operating or technical
difficulties in connection with mining or development activities,
including geotechnical challenges and disruptions in the
maintenance or provision of required infrastructure and information
technology systems; failure to comply with environmental and health
and safety laws and regulations; the failure to obtain key licenses
by governmental authorities, including the mining lease and
exploration license for the Reko Diq project; changes in national
and local government legislation, taxation, controls or regulations
and/or changes in the administration of laws, policies and
practices; expropriation or nationalization of property and
political or economic developments in the Islamic Republic of
Pakistan or the Province of Balochistan; timing of receipt of, or
failure to comply with, necessary permits and approvals; lack of
certainty with respect to foreign legal systems, corruption and
other factors that are inconsistent with the rule of law; risks
associated with illegal and artisanal mining; risks associated with
new diseases, epidemics and pandemics, including the effects and
potential effects of the global Covid-19 pandemic; damage to
Barrick’s reputation due to the actual or perceived occurrence of
any number of events, including negative publicity with respect to
the Barrick’s handling of environmental matters or dealings with
community groups, whether true or not; the possibility that future
exploration results will not be consistent with Barrick’s
expectations; risks that exploration data may be incomplete and
considerable additional work may be required to complete further
evaluation, including but not limited to drilling, engineering and
socioeconomic studies and investment; risk of loss due to acts of
war, terrorism, sabotage and civil disturbances; litigation;
contests over title to properties, particularly title to
undeveloped properties, or over access to water, power and other
required infrastructure; business opportunities that may be
presented to, or pursued by, Barrick; risks associated with working
with partners in jointly controlled assets; employee relations
including loss of key employees; increased costs and physical
risks, including extreme weather events and resource shortages
related to climate change; and availability and increased costs
associated with mining inputs and labor. In addition, there are
risks and hazards associated with the business of mineral
exploration, development and mining, including environmental
hazards, industrial accidents, unusual or unexpected formations,
pressures, cave-ins, flooding and gold bullion, copper cathode or
gold or copper concentrate losses (and the risk of inadequate
insurance, or inability to obtain insurance, to cover these
risks).
Many of these uncertainties and contingencies
can affect our actual results and could cause actual results to
differ materially from those expressed or implied in any
forward-looking statements made by, or on behalf of, us. Readers
are cautioned that forward-looking statements are not guarantees of
future performance. All of the forward-looking statements made in
this press release are qualified by these cautionary statements.
Specific reference is made to the most recent Form 40-F/Annual
Information Form on file with the SEC and Canadian provincial
securities regulatory authorities for a more detailed discussion of
some of the factors underlying forward-looking statements and the
risks that may affect Barrick’s ability to achieve the expectations
set forth in the forward-looking statements contained in this press
release.
We disclaim any intention or obligation to
update or revise any forward-looking statements whether as a result
of new information, future events or otherwise, except as required
by applicable law.
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