Barrick Gold Corp (TSE:ABX) agrees property earn-in for ATAC’s Orion Project

Barrick Gold Corp (TSE:ABX, Mkt cap 30.86B, Div/yield 0.04/0.59, EPS 0.75, Shares 1.17B) and ATAC Resources Ltd have entered into a property earn-in agreement, ATAC said on Monday.

According to the Yukon-based exploration company, the agreement allows Barrick to acquire an interest in the central portion of ATAC's Rackla Gold Property, known as the Orion Project.

TSE:ABX Barrick Gold

Barrick Gold Corp (TSE:ABX) agrees property earn-in for ATAC’s Orion Project

Barrick will potentially invest a total of up to $63.3m, including a private placement of $8.3m and a two-stage, $55m exploration earn-in option to acquire up to 70% of the Orion Project.

The Rackla Gold Property covers 1,742 square kilometres in east-central Yukon. In all, it comprises three projects:

1. The Osiris Project, located at the east end of the property, covers 302 square kilometres and hosts the Osiris, Conrad, Ibis and Sunrise drill confirmed Carlin-type gold discoveries;

2. The Rau Project, located at the west end of the property, covers 660 square kilometres and hosts the Tiger Gold Deposit in addition to other early-stage carbonate-replacement style gold and base metal targets; and

3. The Orion Project, located in the central portion of the property, covers 780 square kilometres and is the only project subject to the Barrick agreement. The Orion Project hosts the Orion and Anubis drill confirmed Carlin-type gold discoveries in addition to eight other early stage Carlin-type gold prospects.

"We view the earn-in agreement and related private placement with the world's largest gold producer as a significant endorsement of the Rackla Gold Property, the ATAC exploration team and the Yukon as a region with world-class gold potential," commented ATAC's president and CEO Graham Downs. "The placement funds, together with access to Barrick's expertise will help accelerate ATAC's exploration and development work over the entire Rackla Gold Property."

Barrick Gold Corp (TSE:ABX) is a Toronto  based gold mining company. The Company is engaged in the production and sale of gold and copper, as well as related activities, such as exploration and mine development. The Company operates in segments: eight individual gold mines, Acacia and Pascua-Lama project. The remaining operating segments have been grouped into two other categories: its remaining gold mines and its two copper mines. The Company sells its production in the world market through the distribution channels: gold bullion is sold in the gold spot market; gold and copper concentrate is sold to independent smelting companies, and copper cathode is sold to various manufacturers and traders. The Company has 14 producing gold mines, located in Canada, the United States, Peru, Argentina, Australia, the Dominican Republic and Papua New Guinea. It also holds a 63.9% equity interest in Acacia Mining plc (Acacia) that owns gold mines and exploration properties in Africa.
More from Reuters »

What is Successful Investing? Learn more here>>

Download Our Free Special Report – How to Hunt For Value Stocks. Michael Sprung will share with you 5 stocks set for long-term gains here>>

We believe that investment management is about managing risk, not chasing speculative returns. Like to learn more? Please contact us here>>

The opinions expressed here are ours alone. They are provided for information purposes only and are not tailored to the needs of any particular individual or company, are not an endorsement, recommendation, or sponsorship of any entity or security, and do not constitute investment advice. We strongly recommend that you seek advice from a qualified investment advisor before making any investment decision.

 

TSE:ABX – Barrick Gold and Antofagasta win arbitration case over Pakistan mining project

Toronto-based gold mining company Barrick Gold Corp (TSE:ABX, Mkt cap 30.93B, Div/yield 0.04/0.60, EPS 0.75, Shares 1.17B) and its joint venture partner Antofagasta have won a dispute over a multibillion-dollar mining project in Pakistan.

TSE:ABX Barrick Gold Antofagasta win arbitration case  Pakistan

TSE:ABX – Barrick Gold and Antofagasta win arbitration case over Pakistan mining project

Barrick said last week that an arbitration tribunal of the World Bank's International Center for Settlement of Investment Disputes (ICSID) had ruled in favour of Tethyan Copper Co. (TCC), a joint venture between Barrick and London-listed Antofagasta, in relation to the denial of a mining lease for the Reko Diq copper and gold reserve in the Balochistan province in southwestern Pakistan.

The two companies took the Pakistani government to the ICSID tribunal after they were denied a mining lease for the Reko Diq project in 2011.

According to Barrick, the tribunal rejected Pakistan's final defence against liability, and confirmed that the country had violated several provisions of its bilateral investment treaty with Australia, where TCC is incorporated.

Next, the tribunal will consider submissions from the parties before determining the size of the damages to be paid to TCC. A ruling on damages is expected in 2018.

A feasibility study by TCC showed that Reko Diq was one of the world's largest undeveloped copper and gold deposits, with a potential mine life of over 50 years.

It was expected to require an initial capital investment of more than $3bn, but estimates suggest the open pit mine project would yield 200,000 tons of copper and 250,000 ounces of gold a year, contained in 600,000 tons of concentrate, mining news website Mining.com reported.

"We are pleased with this decision and now the damages phase of the arbitration can begin," said Iván Arriagada, CEO of Antofagasta. "We expect that, at the conclusion of this phase, Tethyan will receive an award entitling it to the fair market value of the project at the time that the mining lease application was denied."

Barrick Gold Corp (TSE:ABX) is a Toronto  based gold mining company. The Company is engaged in the production and sale of gold and copper, as well as related activities, such as exploration and mine development. The Company operates in segments: eight individual gold mines, Acacia and Pascua-Lama project. The remaining operating segments have been grouped into two other categories: its remaining gold mines and its two copper mines. The Company sells its production in the world market through the distribution channels: gold bullion is sold in the gold spot market; gold and copper concentrate is sold to independent smelting companies, and copper cathode is sold to various manufacturers and traders. The Company has 14 producing gold mines, located in Canada, the United States, Peru, Argentina, Australia, the Dominican Republic and Papua New Guinea. It also holds a 63.9% equity interest in Acacia Mining plc (Acacia) that owns gold mines and exploration properties in Africa.
More from Reuters »

What is Successful Investing? Learn more here>>

Download Our Free Special Report – How to Hunt For Value Stocks. Michael Sprung will share with you 5 stocks set for long-term gains here>>

We believe that investment management is about managing risk, not chasing speculative returns. Like to learn more? Please contact us here>>

The opinions expressed here are ours alone. They are provided for information purposes only and are not tailored to the needs of any particular individual or company, are not an endorsement, recommendation, or sponsorship of any entity or security, and do not constitute investment advice. We strongly recommend that you seek advice from a qualified investment advisor before making any investment decision.

 

Barrick Gold – Q1 results prove ‘Barrick is back,’ says chairman

Barrick Gold Corp. (TSE:ABX) Higher-than-expected first-quarter earnings, a share price that has doubled since the start of the year and a lower all-in sustaining cost guidance for 2016 has given Barrick Gold Corp.’s chairman John Thornton the opportunity to declare: “Barrick is back.”

Barrick Gold back

Barrick Gold – Q1 results prove ‘Barrick is back,’ says chairman

The turnaround in fortunes will come as welcome relief for Barrick’s directors and senior management, the Financial Post reports.

At last year’s meeting, shareholders were up in arms over Thornton’s compensation. Prior to that, the Toronto-based company were forced to deal with the aftermath of its failed attempt to merge with Newmont Mining Corp. In 2013, meanwhile, there was yet another controversy over Thornton’s pay.

However, some might now argue that Thornton is worth every penny that has been paid to him. In shaking up the senior management team, shrinking the head office and increasing co-operation between mine managers, the former Goldman Sachs executive has ensured a strong set of operating results.

On Tuesday, the company reported better-than-expected first-quarter earnings of US$127 million (on an adjusted basis) and lowered all-in sustaining cost guidance for 2016 by as much as 8% (to between US$760 and US$810 an ounce).

The solid performance has restored investors’ faith in Barrick, too, but Thornton acknowledged that there is more work to be done – especially when it comes to reducing debt.

“This is just the beginning,” he said. “We do not believe in victory laps. We set the bar higher and go back to work.”

Barrick has made a good start, announcing on Tuesday that it reduced debt by US$842 million in the first quarter, meaning it’s well on its way to its target of US$2 billion by the end of 2016.

Barrick Gold Corp. is a Toronto  based gold mining company. The Company is engaged in the production and sale of gold and copper, as well as related activities, such as exploration and mine development. The Company operates in segments: eight individual gold mines, Acacia and Pascua-Lama project. The remaining operating segments have been grouped into two other categories: its remaining gold mines and its two copper mines. The Company sells its production in the world market through the distribution channels: gold bullion is sold in the gold spot market; gold and copper concentrate is sold to independent smelting companies, and copper cathode is sold to various manufacturers and traders. The Company has 14 producing gold mines, located in Canada, the United States, Peru, Argentina, Australia, the Dominican Republic and Papua New Guinea. It also holds a 63.9% equity interest in Acacia Mining plc (Acacia) that owns gold mines and exploration properties in Africa.
More from Reuters »

What is Successful Investing? Learn more here>>

Download Our Free Special Report – How to Hunt For Value Stocks. Michael Sprung will share with you 5 stocks set for long-term gains here>>

We believe that investment management is about managing risk, not chasing speculative returns. Like to learn more? Please contact us here>>

The opinions expressed here are ours alone. They are provided for information purposes only and are not tailored to the needs of any particular individual or company, are not an endorsement, recommendation, or sponsorship of any entity or security, and do not constitute investment advice. We strongly recommend that you seek advice from a qualified investment advisor before making any investment decision.

 

Barrick Gold revealed as Canada’s best-performing stock in 2016

Barrick Gold Corp.(TSE:ABX, Mkt cap 16.04B, P/E – , Div/yield 0.03/0.77, EPS -3.67, Shares 1.17B) shares have soared by 29% this year in Toronto, making it Canada’s best-performing stock, the Financial Post reports.

Barrick revealed best-performing stock

Barrick revealed as Canada’s best-performing stock in 2016

The Standard & Poor’s/TSX Composite Index also reveals that Barrick has overtaken its two biggest competitors, Goldcorp Inc. and Newmont Mining Corp., in market capitalization, allowing it to win back the title of the world’s most valuable gold company.

The ascendency up the Index has not been straight forward for Barrick, with more than US$3-billion worth of asset sales having taken place, while it has also worked hard to formulate joint ventures and aggressively cost cuts.

Those efforts saw the company achieve its target of cutting its US$13.1-billion debt by $3 billion in 2015, setting it on course to put itself in a position where it can withstand much lower gold prices than those seen today.

“It’s great to see that our shareholders are starting to recognize the progress that we’ve made but, make no mistake, there’s a lot of lifting we have to do in 2016,” Barrick President Kelvin Dushnisky said in a phone interview Wednesday.

He added that the primary objective this year will continue to be to cut operating costs and improve productivity as a means to further reduce the company’s debt.

Dushnisky would not be drawn on any debt-reduction targets for 2016 until it posts its fourth-quarter earnings on Feb. 17. However, he was prepared to say that the US$3-billion debt reduction last year “wasn’t the final step – that was the first step.”

Barrick Gold Corporation is a Toronto based gold mining company. The Company is engaged in the production and sale of gold and copper, as well as related activities, such as exploration and mine development. The Company operates in segments: eight individual gold mines, Acacia and Pascua-Lama project. The remaining operating segments have been grouped into two other categories: its remaining gold mines and its two copper mines. The Company sells its production in the world market through the distribution channels: gold bullion is sold in the gold spot market; gold and copper concentrate is sold to independent smelting companies, and copper cathode is sold to various manufacturers and traders. The Company has 14 producing gold mines, located in Canada, the United States, Peru, Argentina, Australia, the Dominican Republic and Papua New Guinea. It also holds a 63.9% equity interest in Acacia Mining plc (Acacia) that owns gold mines and exploration properties in Africa.
More from Reuters »

What is Successful Investing? Learn more here>>

Download Our Free Special Report – How to Hunt For Value Stocks. Michael Sprung will share with you 5 stocks set for long-term gains here>>

We believe that investment management is about managing risk, not chasing speculative returns. Like to learn more? Please contact us here>>

The opinions expressed here are ours alone. They are provided for information purposes only and are not tailored to the needs of any particular individual or company, are not an endorsement, recommendation, or sponsorship of any entity or security, and do not constitute investment advice. We strongly recommend that you seek advice from a qualified investment advisor before making any investment decision.

 

Barrick Gold Corp reports another quarter of positive cash flow

Barrick Gold Corp.(TSE:ABX, Mkt cap 11.71B, P/E – , Div/yield 0.03/1.04, EPS -3.01, Shares 1.16B) has reported positive cash flow for the second straight quarter after a long period of negative cash flow, the Financial Post reports.

Barrick Gold Corp report positive cash flow

Barrick Gold Corp. reports another quarter of positive cash flow

As well as posting solid third quarter earnings, the world’s biggest gold producer also reported to having reduced its cost guidance in the period and said it is edging ever closer to its US$3 billion debt reduction target for 2015.

Adjusted net income in the third quarter exceeded the average analyst estimate at US$131 million, or 11 cents a share.

Barrick’s free cash flow was up from US$26 million in Q2 to US$256 million (not counting a streaming sale), while the net loss in the quarter was US$264 million, due to an impairment tied to the Zaldivar mine.

The results suggest that the company is pressing on under Chairman John Thornton, in spite of the weak gold marker, the FT notes. Since becoming chairman last year, he has sought to shed non-core assets and replace most of the management team.

Thornton aims to streamline Barrick back into profit and eliminate the strategic errors that crippled its balance sheet. By cutting its overall debt in the first nine months of the year from US$13.1 billion to US$11.2 billion, it indicates the company is headed in the right direction.

“As we move into 2016 and beyond, we will continue to take prudent steps to strengthen our balance sheet, balancing debt repayments with investments in profitable production that will drive growth in free cash flow,” the miner said in a statement.

However, investors are said to still be concerned about the firm’s balance sheet, as well as the health of the gold market.

Barrick Gold Corp is a Canadian gold mining company with headquarters in Toronto. The Company is engaged in the production and sale of gold and copper, as well as related activities, such as exploration and mine development. The Company operates in segments: eight individual gold mines, Acacia and Pascua-Lama project. The remaining operating segments have been grouped into two other categories: its remaining gold mines and its two copper mines. The Company sells its production in the world market through the distribution channels: gold bullion is sold in the gold spot market; gold and copper concentrate is sold to independent smelting companies, and copper cathode is sold to various manufacturers and traders. The Company has 14 producing gold mines, located in Canada, the United States, Peru, Argentina, Australia, the Dominican Republic and Papua New Guinea. It also holds a 63.9% equity interest in Acacia Mining plc (Acacia) that owns gold mines and exploration properties in Africa.
More from Reuters »

What is Successful Investing? Learn more here>>

Download Our Free Special Report – How to Hunt For Value Stocks. Michael Sprung will share with you 5 stocks set for long-term gains here>>

We believe that clients gain from our focus on the long-term fundamentals and not chasing short-term trends. Like to learn more? Please contact us here>>

The opinions expressed here are ours alone. They are provided for information purposes only and are not tailored to the needs of any particular individual or company, are not an endorsement, recommendation, or sponsorship of any entity or security, and do not constitute investment advice. We strongly recommend that you seek advice from a qualified investment advisor before making any investment decision.

Barrick Gold encouraged by interest in U.S. gold asset sale

Barrick Gold Corp.(TSE:ABX, Mkt cap 9.78B, P/E – , Div/yield 0.03/1.26, EPS -3.05, Shares 1.16B) has reported an “extremely high” level of interest in its package of six U.S. gold assets, with a deal expected to be wrapped up before the year is out, Reuters reports.

Barrick Gold US gold asset sale

Barrick Gold encouraged by interest in U.S. gold asset sale

The Toronto-based firm made the package public last month in attempt to cut at least $3 billion in debt this year, which comprises: Bald Mountain, Round Mountain, Spring Valley, Ruby Hill, Hilltop and Golden Sunlight assets.

Initial interest has primarily been from North American-based miners, Barrick President Kelvin Dushnisky revealed, while suggesting that the world’s biggest gold producer is keeping an open mind as to whether or not the six U.S. gold mines and projects will be kept as a package.

“If it makes sense to split it up and we will get better value as a whole for that, we will certainly consider it,” he told Reuters in an interview at the Denver Gold Forum, an annual gold industry conference.

However, Dushnisky would not be drawn on how much the asset package might be worth, but analysts expect it to sell for somewhere in the region of $500 million and $700 million.

If the year-end sales target proves realistic, it will take Barrick over its $3 billion debt reduction target following other asset disposals and financings, including a recent so-called “streaming” deal on its Pueblo Viejo mine in the Dominican Republic.

While Dushnisky said Barrick was not contemplating any more streaming deals, he hinted that it was open to selling more noncore assets.

For the time being, however, its Lumwana copper mine in Zambia is not likely to be on the “to be sold” list, with the firm likely to wait for better copper prices, Dushnisky explained.

Barrick Gold Corp is a Toronto based gold mining company. It trades on the Toronto and New York Stock exchanges under the sumbol ABX. Barrick is engaged in the production and sale of gold and copper, plus related activities, including exploration and mine development. The Company operates in segments: eight individual gold mines, Acacia and Pascua-Lama project. The remaining operating segments have been grouped into two other categories: its remaining gold mines and its two copper mines.

What is Successful Investing? Learn more here>>

Download Our Free Special Report – How to Hunt For Value Stocks. Michael Sprung will share with you 5 stocks set for long-term gains here>>

We believe that clients gain from our focus on the long-term fundamentals and not chasing short-term trends. Like to learn more? Please contact us here>>

The opinions expressed here are ours alone. They are provided for information purposes only and are not tailored to the needs of any particular individual or company, are not an endorsement, recommendation, or sponsorship of any entity or security, and do not constitute investment advice. We strongly recommend that you seek advice from a qualified investment advisor before making any investment decision.

 

Barrick Gold Corp to part with half of Chile mine for US$1bn

Barrick Gold Corp. (TSE:ABX, Mkt cap 10.44B, P/E – , Div/yield 0.02/0.9, EPS -3.32, Shares 1.16B) has announced a deal to sell a 50% stake in its Zaldivar copper mine in Chile for a figure in the region of US$1 billion, the Financial Post reports.

Barrick Gold Corp Zaldivar copper mine Chile

Barrick Gold Corp to sell half of its Zaldivar copper mine in Chile

The news is likely to be well received by investors, who have grown increasingly concerned at the level of debt carried by Toronto-based Barrick.

The firm also looks set to be faced with tumbling gold prices, making the sale of the stake to Antofagasta PLC, a large Chilean copper miner, particularly timely.

The deal was a long time coming due to a protracted auction process which saw almost every notable copper mining business in the world materialise as a potential buyer.

In the end it was Antofagasta that managed to secure the Zaldivar deal, which makes most sense from an experience and expertise point of view, the Financial Post notes.

“By selling a stake in this non-core asset, we strengthen our balance sheet while maintaining significant exposure to a strong cash-generating operation,” Barrick co-president Kelvin Dusnhisky said in a statement.

With net debt of more than US$10 billion to its name as of the end of the first quarter, Barrick has since worked hard to shed some lucrative assets with combined sales totalling US$1.85 billion.

This is in keeping with the miner’s pledge to cut debt by at least US$3 billion by the end of the calendar year. The company said last week that it was eyeing up a number of other “joint venture and sales opportunities.”

Barrick also explained that the deal with Antofagasta marks the start of a long-term partnership between the two firms, which could see them join forces on future development projects.

Antofagasta will pay Barrick US$980 million in cash up-front, and an additional US$25 million over the next five years.

Barrick has also cut its quarterly dividend to US2 cents a share from US6 cents, a move that will save the company almost US$140 million a year.

What is Successful Investing? Learn more here>>

Download Our Free Special Report – How to Hunt For Value Stocks. Michael Sprung will share with you 5 stocks set for long-term gains here>>

We believe that the success of a particular investment is always relative to the price you paid. Like to learn more? Please contact us here>>

The opinions expressed here are ours alone. They are provided for information purposes only and are not tailored to the needs of any particular individual or company, are not an endorsement, recommendation, or sponsorship of any entity or security, and do not constitute investment advice. We strongly recommend that you seek advice from a qualified investment advisor before making any investment decision.

 

Stock Watch – Michael Sprung on Barrick – Newmont Merger

Stock Watch – Michael Sprung’s first take on the proposed Barrick Gold Corp. and Newmont Mining Corp merger

Stock Wathch Michael Sprund BNN Barrick Newmont merger dilutive Barrick shareholders

Michael Sprung on BNN – Proposed Barrick and Newmont merger is slightly dilutive to Barrick shareholders

Michael’s first take on the proposed Barrick Gold Corp. (TSE:ABX, Mkt cap 22.28B, P/E – , Div/yield 0.06/1.16, EPS -10.61,Shares 1.16B) and Newmont Mining Corp (NYSE:NEM, Mkt cap 12.56B, P/E – , Div/yield 0.15/2.40, EPS -5.06, Shares 502.93M) merger:

  • Proposed Barrick and Newmont merger is slightly dilutive to Barrick shareholders, a slight premium to Newmont shareholders;
  • Given the decline in the price of gold and cost escalations, we would expect to see more mergers in the industry;
  • We will not know if this is a good deal until a year out;
  • Will they be able to achieve the proposed cost synergies?
  • Deal is somewhat credit negative – debt to jump to $15B from $10B, net debt to EBITDA will approach 2 times;
  • We hope the merged entity will retain a Canadian head office.

Michael Hainsworth:  Michael Sprung is at Sprung Investment Management, at TSX for us today and he joins us for his take. Is this a good deal? Should this deal go through?

Michael Sprung:        With these mega deals, it’s often very hard to say from the outset if this is a good or a bad deal. I think what we are seeing in the market today is the reaction that on the surface this is slightly dilutive to Barrick shareholders, and you are in fact getting a small premium to the Newmont shareholders.

But this is the sort of environment where you expect to see this kind of merger. I think we are going to see more mergers in the sector given the price of gold and the massive cost escalations that we have seen on the capital expenditure side and cost of goods sold and so on.

So I think that nobody will know if this is a good deal until it’s done and the paperwork is done; in a year or so out we can reflect back and say, were they able to achieve these cost synergies.

To me, this is the key to this deal. They are talking about a billion dollars in cost synergies; most of that in Nevada. Well, in Nevada, if they are spending a combined, what is it, about half a billion a year in capital expenditures and cost of goods sold, well, actually it’s about 4.3, we are talking about substantial, substantial savings, which on the surface appear a little bit aggressive, and so it’s going to remain to be seen.

The second component of course is on the Spin Co; well, they achieve the valuation for that this is necessary to make the metrics of this transaction work. When we look at Barrick, initially going into this, this is somewhat credit negative. We can see debt going up to around 15 billion from just over 10, and net debt to EBITDA approaching two times.

Then if they achieve these cost savings, all these things come more into line and we will have a stronger company.

This is not new. Some time ago Mr. Monk was musing on a possible combination with Glencore. So I think there are going to be some big mergers. As a Canadian I hope that they maintain the head office in Canada. It would be good to have a remaining major global miner in Canada. We have lost so many over the years. So I am hoping that that part of it gets worked out.

But there is a lot of things that we don’t know and I think that there is a lot of fine details that they have yet to work out.

On balance, this deal is not being done for diversification by any means. I mean, these are two strong gold mining companies with some copper assets, but I think what it’s really setting them up is to make it a stronger force to take advantage of more of the M&A activities that may be coming up in the next period. And I think they would be a formidable force in the industry.

Michael Hainsworth:  Michael, to your point about premiums, at a 13% premium, that doesn’t seem to be as much as some had wanted or expected, but having said that, is that a reflection of the fact that gold is 20% off its highs?

Michael Sprung:        Oh, I think to a great extent it is. When gold is really moving and the market is moving quickly, premiums tend to go up in overestimation of all the great things that are yet to come. So I think the current environment is a good one from a shareholder’s perspective to see mergers taking place, because you don’t see the crazy kind of premiums that often take place in more frothy markets.

Michael Hainsworth:  Michael, great having you with us! Thank you for your insight!

Michael Sprung:        Thank you!

Michael Hainsworth:  Michael Sprung is President of Sprung Investment Management. He joined us from the TSX Broadcast Centre.

See Michael discuss the proposed merger with Michael Hainsworth on BNN here>>