Barrick could be buying silver on the futures market due to contractual obligations: Silver Doctors

The Silver Doctors worry that Barrick Gold's Pascua Lama gold and silver mine might still not get built due to problems with glaciers in the region.

If that's the case, the company will have to find some accommodation with Silver Wheaton who is owed a lot of silver from the project:

I also believe there is bad news coming out of Pascua Lama. Again, this represents 25% of Barrick’s gold reserves and if Pascua Lama is not allowed to go commercial, it would be disastrous for Barrick’s stock price, balance sheet and contractual obligation to supply Silver Wheaton 170-200 million ounces of silver.

If Pascua Lama is unable to mine gold and silver without threatening the glaciers in both Argentina and Chile, Barrick will have to go into the futures markets and purchase silver to deliver to Silver Wheaton at its contractual price of $3.90 an ounce.


Image of San Juan glacier from Silver Doctors