Barrick Gold (TSX: ABX) (NYSE: GOLD), the world’s second largest gold miner, has unveiled a 10-year production plan aimed at becoming the most valued bullion company.
The strategy, outlined in its first annual report since its merger with Randgold Resources, includes boosting Barrick’s production to about 5 million ounces of gold a year, with the bulk coming from its North American operations.
President and chief executive officer, Mark Bristow, said Nevada Gold Mines — its recent joint venture with Newmont (NYSE: NEM) — would be the “value foundation” of its business moving forward.
“Already the world’s largest gold mining complex, it holds enormous potential for growth,” Bristow said.
Bristow warned the new guidance might be impacted if operations were disrupted due to efforts to slow the spread of the covid-19. He called the pandemic “a global disaster which is changing the way we work and live in a radically disruptive process with currently no clear end in sight.”
In the past year, Barrick has been focusing on its tier one assets and has reported strong performance across the group, particularly at Cortez mine in Nevada and Veladero in Argentina.
It has also boosted production at Kibali, Congo’s biggest gold mine, which last year beat its production guidance of 750,000 ounces of gold by a substantial margin, delivering a new record of 814,027 ounces.
Porgera in Papua New Guinea has tier one potential but faces many challenges in the form of “legacy issues and an unruly neighbourhood,” Bristow said, adding the mine had exceeded guidance and the company continued to negotiate a 20-year lease extension with the government.
The executive, who took the helm in January 2019, said the work done over the past year had equipped Barrick to move to the next level.
“All in all, I am confident that we are more than capable of delivering on our promise: to build the world’s most valued gold company,” he said.
Bristow noted that Barrick’s definition of value was more wide-ranging and included factors such as economic benefits, the care with which it treated its people, communities and environments, its strategic focus on long-term sustainability and returns for investors.