Barrick Gold sells stake in Australian mine

Gold company Barrick Gold has announced plans to sell its 50% non-operating interest in an Australian gold mine for US $ 750M.

The deal announced on Sunday will see Australian mining company Saracen Mineral Holdings buy Barrick’s stake in Kalgoorlie Consolidated Gold Mines in Western Australia – which includes the country’s largest surface gold mine, The Super Pit, as well as work underground and processing.

Barrick CEO Mark Bristow said the transaction would allow Toronto-based mining to reach the midpoint of its goal of raising $ 1.5 billion (G) US from the sale of assets deemed non-essential by the end of next year. Barrick intends to focus more on the mines it owns and operates.

Analysts were divided on the price of the transaction, obtained after a competitive process. Andrew Kaip, an analyst with Bank of Montreal, noted that the amount was higher than his estimate of US $ 614M, while Mike Parkin, of National Bank, had calculated expecting US $ 864M. 

Newmont Goldcorp, the operator and owner of the other half of the mine, welcomed its new partner.

He said the mine, which has produced about 21 million ounces of gold over the past three decades, will continue to operate as usual. It employs approximately 1,250 people and produced 636,000 ounces of gold in 2018.

“Even though this iconic gold mine has made a valuable contribution to Barrick over the years, this asset is not in keeping with our strategy for mining the mines we own,” said Bristow in a press release.

Barrick’s action rose 39 cents on the Toronto Stock Exchange Monday afternoon, where it was trading at $ 22.30.

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