Oct 23 (Reuters) – African Barrick Gold Plc tightened its costs target for the full year as it increased output while also cutting jobs to beat the sharp drop in gold prices.
The miner reported a fall in overall expenses for an eighth successive quarter after it cut more than 500 jobs at its flagship Bulyanhulu mine in Tanzania in the third quarter ended Sept. 30.
African Barrick’s stock was among the top percentage gainers on the FTSE-250 Midcap Index on Thursday, rising as much as 4.8 percent in early trading.
To beat shrinking gold prices, African Barrick has been accelerating production at Bulyanhulu, the largest of its three operating mines in Tanzania, by increasing its use of technology.
Many gold and silver miners were forced to shelve new projects and slash costs last year after prices of precious metals fell to their lowest in a decade. Gold fell 28 percent and silver plunged 36 percent in 2013. “By the end of next year we expect Bulyanhulu to produce 350,000 ounces at $900 per ounce,” Chief Executive Bradley Gordon told Reuters.
The mine, which produced 198,286 ounces of gold in 2013 at an overall cost of $1,344 per ounce sold, now employs around 1,900 people, compared with 3,400 a year ago.
African Barrick, which reported a 17 percent jump in third-quarter core profit, said it anticipates full-year costs at the lower end of it target range of $1,100-$1,175 per ounce sold.
All-in sustaining costs (AISC) – a widely used measure that includes production and exploration expenses – fell 14 percent to $1,098 per ounce sold in the third quarter.
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