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Barrick tackling Pueblo Viejo ‘teething problems’

Barrick CEO Mark Bristow

Barrick CEO Mark Bristow

15th March 2024

By: Mariaan Webb

Creamer Media Senior Deputy Editor Online

     

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Gold and copper miner Barrick has experienced “teething problems” at its flagship Dominican Republic growth project, CEO Mark Bristow said on Friday, but added that the Pueblo Viejo expansion project should be back on track this quarter.

The expansion and mine life extension project is designed to increase throughput to 14-million tonnes a year and sustain gold production above 800 000 oz/y going forward.

The construction and commissioning activities for the plant expansion were substantially completed by the end of the last year. Premature equipment failures were encountered early in the commissioning, but have been resolved.

However, at the start of the fourth quarter, the project experienced a structural failure of the crushed ore stockpile feed conveyor.

Reconstruction work is under way and should be completed in the second quarter, Barrick reported in its 2023 Annual Report, published on Friday.

The company will also complete a feasibility study for additional tailings storage capacity at Pueblo Viejo this year.

By December 31, 2023, the total project spend on the Pueblo Viejo expansion was $1.03-billion. Barrick maintained the estimated capital cost of the plant expansion and mine life extension at $2.1-billion.

Meanwhile, reflecting on the group’s organic growth strategy, Bristow said there would be “exciting developments” this year.

In Nevada, which hosts three of Barrick’s tier-one gold mines, Cortez received its long-awaited record of decision for Goldrush just before the end of last year, allowing for the accelerated development of the project.

Cortez will produce 130 000 oz of gold this year, rising to 400 000 oz/y by 2028.

“Far from being a mature destination, this vast area is rich in potential for further world-class discoveries, as well as opportunities for reserve replacement and expansion, which we are aggressively pursuing,” said Bristow.

Barrick is also ramping up the drilling and evaluation of the Fourmile project, adjacent to Goldrush, with a view of starting a prefeasibility study at year-end.

Further, Barrick is looking forward to being promoted into the “premier league” of copper producers when its Super Pit expansion project at Lumwana, in Zambia, and the Reko Diq project, in Pakistan, come on line.

The $2-billion expansion project at Lumwana is scheduled to go into production in 2028, with projected yearly production of 240 000 t/y over 30 years.

Bristow pointed out that Barrick’s gold and rapidly growing copper portfolios now extend across all the major gold and copper districts worldwide, providing the company with a solid base from which to grow its production and value.

“Discovery and development are the true drivers of value and our strong focus on exploration is evident in our widespread hunt for new discoveries with tier-one potential, as well as reserve replenishment opportunities,” he said.

He noted that Barrick had a unique record of more than replacing depleted reserves. Last year, it increased its gold reserves to 77-million ounces and replaced 112% of its annual gold-equivalent production. Since 2019, it has organically added 29-million ounces of attributable reserves which, on a 100% basis, represents 44-million ounces of reserve addition across all Barrick-managed mines.

“Our proven ability to replace the ounces of gold and pounds of copper we mine, and the organic growth opportunities embedded in our business, give us the confidence to believe that we can deliver on and continue to extend our ten-year gold and copper production forecast without dilutionary acquisitions. As a result of this, we also continue to forecast an increase of more than 30% in gold equivalent production by the end of this decade.”

Year-on-year operating cash flow increased by 7%, free cash flow grew by 50% and adjusted net earnings rose by 12%. The performance of our business and the continued strength of our balance sheet allowed us to maintain a robust dividend for our shareholders in 2023.

“Barrick’s commitment to real sustainability has long been the bedrock of the business and integrates all aspects of environmental and community responsibilities. This strategy is based on sharing the benefits of our operations with all our stakeholders and is fundamental to our social licence to operate,” Bristow said.

Also in the annual report, chairperson John Thornton said the foundational creed of the 2019 merger with Randgold was that the best assets run by the best people would deliver the best returns.

“Barrick’s focus on tier-one assets and the results they are producing show unquestionably that its management ranks in the forefront of the industry’s leadership. Through continuing investment in human capital, Barrick is recruiting and developing its next generation of high achievers,” he said.

Edited by Creamer Media Reporter

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