Barrick reports drop in Q3 gold production

Barrick Gold Corp.’s [ABX-TSX, GOLD-NYSE] said Thursday its gold production was lower in the third quarter of 2022. However, the company said it remains on track achieve its production targets for this year, with gold expected to be at the low end of the range and copper production expected to be at the midpoint.

In the third quarter, Barrick reported preliminary gold production of 988,000 ounces, down from 1.04 million ounces in the second quarter. The company said production was lower than the second quarter as a strong performance of its Pueblo Viejo mine in the Dominican Republic was offset by lower production at Valedero (Argentina), Carlin and Turquoise Ridge (both in Nevada). In addition, production was lower at Long Canyon (Nevada) than in the second quarter following completion of Phase 1.0 mining in May, 2022.

Compared to the second quarter, third quarter gold cost of sales per ounce is expected to be in line with the prior quarter, with total cash costs per ounce and all-in-sustaining costs per ounce are both expected to be 3.0% to 5.0% higher.

Meanwhile, the company reported 123 million pounds of copper production in the third quarter, an increase of 2.5% from the previous quarter thanks to the strong performance of its Lumwana mine in Zambia.

Barrick has gold and copper mining operations and projects in 13 countries in North and South America, Africa, Papua New Guinea and Saudi Arabia.

The portfolio includes half of the world’s top 10 tier one gold assets (defined as having a mine life of over 10 years, at least 500,000 ounces of annual production and in the bottom half of global total cash costs).

They include Cortez and Goldstrike in Nevada, Kibali in the Democratic Republic of Congo, Loulo-Gounkoto in Mali, and Pueblo Viejo.

Another key asset is Barrick’s Nevada Gold Mines operation. Nevada Gold Mines, established in July 2019, is owned 61.5% and operated by Barrick Gold. Newmont Corp. [NGT-TSX, NEM-NYSE] holds the other 38.5%.

The joint venture ranks as the largest global gold producing complex by a wide margin, with three of the world’s top 10 Tier One gold assets (Goldstrike/Carlin, Cortez and Turquoise Ridge/Twin Creeks) and potentially another one in the making (Goldrush).

On Thursday, Barrick said access to high grade ore that was previously expected to be in late third quarter at Nevada Gold Mines is now scheduled for the fourth quarter, which should drive a strong finish to the year, the company said.

Meanwhile, Barrick said the average market price for gold in the third quarter was US$1,729 per ounce. The average market price for copper in that period was US$3.51 per pound.

On October 12, 2022, Barrick shares closed at $20.84. The shares are currently trading in a 52-week range of $33.50 and $19.02.

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