The Globe and Mail reports in its Thursday edition that Barrick Gold is predicting sharply higher costs and lower grades at a key mine, as well as lacklustre production for 2019, highlighting the challenges the company still faces after its takeover of Randgold Resources.
The Globe's Niall McGee writes that Barrick, which closed its deal for Randgold on Jan. 1, also booked a fourth-quarter net loss of $1.2-billion, as it incurred impairment charges at its Lagunas Norte and Veladero mines in Peru and Argentina, respectively (all figures U.S.).
The Randgold acquisition was designed in part to inject new management talent into Barrick after years of restructuring. Barrick chief executive officer Mark Bristow, who came from Randgold, is considered within the industry to be skilled at trimming costs. In the short term, however, Barrick said it expects its all-in sustaining costs to rise to between $870 and $920 an ounce in 2019, compared with $806 for last year, an increase of between 8 and 14 per cent.
Barrick pinned the expected increases primarily on the transition from low-cost, open-pit mining to higher-cost underground mining at its big Cortez Hills facility in Nevada. Barrick also said fuel costs are rising.
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