23rd August 2013

Barrick Gold Corp. to sell three mines in Australia for $300 million (Canadian Press/Toronto Star – August 23, 2013)

posted in Australia Mining and History, Barrick Gold Corporation, Canada Mining, Canadian Media Resource Articles, Gold and Silver |

The Toronto Star has the largest circulation in Canada. The paper has an enormous impact on federal and Ontario politics as well as shaping public opinion.

Barrick Gold Corp. has agreed to sell off three high-cost mines in Western Australia to South Africa-based miner Gold Fields Ltd. — a move analysts say will free Barrick up to focus on more profitable operations.

Barrick said it will receive about $300 million from the sale, which is subject to customary closing conditions, including approval by Australia’s Foreign Investment Review Board.

The company said the three mines that comprise the Yilgarn South assets produced a total of 452,000 ounces of gold in 2012 and a further 196,000 ounces in the first half of this year.

Kerry Smith, an analyst at Haywood Securities, said selling the higher-cost mines will reduce Barrick’s operating expenses and have only a minimal impact on the company’s production volumes. “By eliminating those three mines out of their portfolio, it frees their management up to spend more time on other assets that actually make more cash,” Smith said.

He estimated the mines are responsible for about five per cent of Barrick’s total production.

“I’m sure they’re selling them at less than they paid for them, but they’ve also had the assets for a long time generating cash,” Smith said.

Elizabeth Collins, an analyst at Morningstar said Barrick is taking a “tiny” step towards reducing its debt burden by divesting the “troubled mines.”

“They’re getting rid of higher-cost mines that have low remaining reserves on a proven basis, and giving them to a company that is smaller and therefore can focus on smaller mines,” Collins said.

For the rest of this article, click here: http://www.thestar.com/business/2013/08/22/barrick_gold_corp_to_sell_three_mines_in_australia_for_300_million.html

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