Loulo-Gounkoto Complex Continues to Invest in Its Future and Points to Ongoing Improvement in Production
LOULO GOLD MINE, Mali, Jan. 22, 2019 (GLOBE NEWSWIRE) — The Loulo-Gounkoto complex in Mali posted a fourth consecutive quarterly improvement in gold production, despite an illegal work stoppage that caused it to miss its full year production guidance of 690,000 ounces by four percent. In addition to this, 2018 was a record throughput year of more than five million tonnes at close to the complex’s reserve grade.
Speaking at a briefing here for local media, Barrick President and Chief Executive Mark Bristow noted that the complex, which ranks among the recently-merged Barrick/Randgold group’s Tier One1 assets, was continuing to invest in its future by exploring for additional reserves and upgrading plant and equipment.
“A preliminary economic assessment of the Loulo 3 open pit and underground project has been completed and drilling continues to expand the area of high-grade mineralization south of the Yalea orebody. Exploration of the Faraba structure on the Gounkoto permit has shown the potential for multiple zones of mineralization to be extended,” Bristow said.
“At the existing operations, we’ve commissioned the second crusher at Yalea, the full integration of the automated dispatch system at Gounkoto and the second radar for the geotechnical monitoring of the Gounkoto pit. The complex has also completed the striker belts project at Gara and moved ahead with the expansion of the tailings treatment facility.”
Bristow said the continuing profitable growth of Loulo-Gounkoto was a shining example of what could be achieved through a genuine partnership between investors, managers and governments. He cited the tax holiday recently granted for the development of the super pit at Gounkoto as a typical instance of mutually beneficial cooperation.
“As Randgold, we’ve been engaged in Mali for 25 years and have worked together productively with successive governments. We look forward to continuing this relationship as Barrick with the recently-elected government and the new minister of mines. Our differences over the tax issue remain on the agenda and we trust that through amicable mediation we’ll arrive at a solution acceptable to both parties,” he said.
Bristow noted that the complex continued to improve its safety and environmental management, and had obtained the new version of the ISO 14001 environmental certification while retaining its OHSAS 18001 health and safety rating.
The group was also maintaining its support for community development programs and projects. At its other Malian asset, Morila, the government has formally endorsed its plan to establish an agribusiness designed to mitigate the social and economic impact of the operations closure.
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On January 1, 2019, a new Barrick was born out of the merger between Barrick Gold Corporation and Randgold Resources Limited. Shares in the new company trade on the NYSE (GOLD) and the TSX (ABX).
The merger has created a sector-leading gold company which owns five of the industry’s Top 10 Tier One1 gold assets (Cortez and Goldstrike in Nevada, USA (100%); Kibali in DRC (45%); Loulo-Gounkoto in Mali (80%); and Pueblo Viejo in Dominican Republic (60%)) and two with the potential to become Tier One1 gold assets (Goldrush/Fourmile (100%) and Turquoise Ridge (75%), both in the USA).
With mining operations and projects in 15 countries, including Argentina, Australia, Canada, Chile, Côte d’Ivoire, DRC, Dominican Republic, Mali, Papua New Guinea, Peru, Saudi Arabia, Senegal, USA, and Zambia, Barrick has the lowest total cash cost2 position among its senior gold peers3 and a diversified asset portfolio positioned for growth in many of the world’s most prolific gold districts.
Cautionary Statement on Forward-Looking Information
Certain information contained in this news release, including any information as to Barrick’s strategy, 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 “continue”, “potential” and “will” and similar expressions identify forward-looking statements. In particular, this news release contains forward-looking statements including, without limitation, with respect to: the potential for multiple zones of mineralization to be extended and combined at the Loulo-Gounkoto complex; and the potential mediation with the government of Mali with respect to tax issues and the outcome of any such mediation.
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 news 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: 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 Mali; lack of certainty with respect to foreign legal systems, corruption, and other factors that are inconsistent with the rule of law; risk of loss due to acts of war, terrorism, sabotage and civil disturbances; fluctuations in the spot and forward price of gold, copper, or certain other commodities (such as silver, diesel fuel, natural gas, and electricity); timing of receipt of, or failure to comply with, necessary permits and approvals; failure to comply with environmental and health and safety laws and regulations; litigation; damage to the 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 speculative nature of mineral exploration and development; changes in mineral production performance, exploitation, and exploration successes; 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; the impact of global liquidity and credit availability on the timing of cash flows and the values of assets and liabilities based on projected future cash flows; the impact of inflation; fluctuations in the currency markets; contests over title to properties, particularly title to undeveloped properties, or over access to water, power, and other required infrastructure; 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 news 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 news release.
Barrick disclaims 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.
Third Party Data
The total cash costs comparison of Barrick to its senior gold peers is based on data obtained from Wood Mackenzie as of August 31, 2018. Wood Mackenzie is an independent third-party research and consultancy firm that provides data for, among others, the metals and mining industry. Wood Mackenzie is not affiliated with Barrick.
Where figures for Barrick are compared to its senior gold peers, the data from Wood Mackenzie has been used to ensure consistency in the compared measure across the Barrick and the comparator group. Barrick does not have the ability to verify the Wood Mackenzie figures and the non-GAAP financial performance measures used by Wood Mackenzie may not correspond to the non-GAAP financial performance measures calculated by Barrick or any of the other senior gold peers.
- A Tier One Gold Asset is a mine with a stated life in excess of 10 years with 2017 production of at least 500,000 ounces of gold and 2017 total cash cost per ounce within the bottom half of Wood Mackenzie’s cost curve tools (excluding state-owned and privately-owned mines). For purposes of determining Tier One Gold Assets, “Total cash cost” per ounce is based on data from Wood Mackenzie as of August 31, 2018. The Wood Mackenzie calculation of “Total cash cost” per ounce may not be identical to the manner in which Barrick calculates comparable measures. “Total cash cost” per ounce is a non-GAAP financial performance measure with no standardized meaning under IFRS and therefore may not be comparable to similar measures presented by other issuers. “Total cash cost” per ounce should not be considered by investors as an alternative to operating profit, net profit attributable to shareholders, or to other IFRS measures. Wood Mackenzie is an independent third-party research and consultancy firm that provides data for, among others, the metals and mining industry. Wood Mackenzie does not have any affiliation to Barrick. See also Endnote #2.
- “Lowest total cash cost” is based on data from Wood Mackenzie as of August 31, 2018. “Total cash cost” is a non-GAAP financial performance measure with no standardized meaning under IFRS and therefore may not be comparable to similar measures presented by other issuers. Financial comparisons between the post-merger Barrick and its senior gold peers are made on the basis of the data presented by Wood Mackenzie which may not be calculated in the same manner as Barrick calculates comparable measures. Barrick believes that total cash cost is a useful indicator for investors and management of a mining company’s performance as it provides an indication of a company’s profitability and efficiency, the trends in cash costs as the company’s operations mature, and a benchmark of performance to allow for comparison against other companies.
- Senior gold peers means the following companies: Agnico Eagle Mines Limited, Goldcorp Inc., Newcrest Mining Limited, and Newmont Mining Corporation.