Barrick says copper operation in Saudi Arabia not affected by diplomatic dispute
A representative of Canadian gold giant Barrick Gold (TSX, NYSE:ABX) told the Globe & Mail today that the company’s Saudi operations are not affected by the current diplomatic dispute between Ottawa and Riyadh.
In an email to the newspaper, spokesman Andy Lloyd said that Barrick has a strong relationship with Ma’aden (TADAWUL:1211), the 50-per-cent state-owned company with which the miner operates the Jabal Sayid copper mine, located 350 kilometers north-east of Jeddah, in the western part of the country.
“We expect that partnership will continue to deepen over time,” Lloyd told the news outlet.
The Toronto-based firm gained the Jabal Sayid project when it acquired copper miner Equinox in 2011 for $6.8 billion. Most of the construction at the asset had been complete for a while, but output was delayed over permit problems related to safety issues and legacy matters over mining license.
Later on, in 2014, Ma’aden paid $210-million to acquire its 50-per-cent stake in Jabal Sayid. Two years later, the mine started commercial activities.
In 2017, Barrick’s share of production from the Saudi mine amounted to 43 million pounds of copper. For 2018, production is expected to be between 40-55 million pounds of the red metal.
But what is going to happen now with the asset is anyone’s guess.
The dispute between Canada and Saudi Arabia started with a tweet sent out last Friday by the Ministry of Foreign Affairs. In the social media post, the Canadian department expressed concerns about new arrests of civil society and women's rights activists in the Gulf country and urged Saudi authorities to release these political prisoners.
The message was not well received in the kingdom. The tweet was deemed as “unfortunate, reprehensible, and unacceptable” by the Saudi foreign ministry, whose head ordered Canada's ambassador, Dennis Horak, to leave the country.
In addition to the tensions in the diplomatic relations, this week, Saudi Arabia ordered its fund managers to dump all Canadian stocks and bonds.