Mr. Steven Haggarty reports

BARRICK REPORTS SECOND QUARTER 2017 RESULTS

Barrick Gold Corp. has released second quarter results for the period ended June 30, 2017. All amounts are expressed in U.S. dollars unless otherwise indicated.

Highlights:

• Barrick reported second quarter net earnings attributable to equity holders of $1,084-million (93 cents per share) and adjusted net earnings of $261-million (22 cents per share).
• The company reported second quarter revenues of $2.16-billion, net cash provided by operating activities of $448-million and free cash flow of $43-million.
• Gold production in the second quarter was 1,432,000 ounces at a cost of sales applicable to gold of $726 per ounce and all-in sustaining costs of $710 per ounce.
• Total debt was reduced by $309-million in the second quarter.
• The company continues to expect full-year gold production of 5.3 million to 5.6 million ounces at a cost of sales of $780 to $820 per ounce and all-in sustaining costs of $720 to $770 per ounce.
• Normal leaching operations, including the addition of cyanide, have resumed at the Veladero mine in Argentina, following the anticipated ramp-up and testing of upgraded leach pad systems.
• The company completed the formation of its strategic partnership with Shandong Gold Group Co. Ltd., a landmark agreement with the potential to create fundamental long-term value for the respective owners, as well as the community and government partners in Argentina.
• Barrick will begin discussions with the government of Tanzania next week concerning the concentrate export ban and other issues impacting Acacia Mining PLC's operations in the country.

The company's portfolio delivered higher gold production and a 10-per-cent decrease in direct mining costs compared with the prior-year period, resulting in lower cost of sales and all-in sustaining costs for the second quarter. A number of factors contributed to lower cash flow over the same period, including higher cash taxes paid, an increase in working capital, and a planned increase in capital expenditures focused on sustaining and increasing the value of the company's operations over the long term. The company expects higher cash flow in the second half of the year as a number of these factors abate.

Reflecting the company's drive to maximize the productivity and efficiency of the company's operations, Barrick has completed the unification of its Cortez and Goldstrike operations, and the company is accelerating the implementation of its digital transformation in Nevada, which will support unit cost improvements, increased throughput and expanding margins. During the quarter, the company continued to optimize its portfolio for long-term value creation, completing the formation of a strategic partnership with Shandong that has the potential to unlock the untapped mineral wealth of the El Indio belt, a highly prospective district on the border of Argentina and Chile that is home to the Veladero mine, Pascua-Lama, Alturas and other projects.

By applying strict capital discipline, leveraging innovation and digital technologies, and building distinctive partnerships, the company is positioning Barrick to increase free cash flow per share over the long term. The company continues to advance a deep organic project pipeline that provides the company's owners with exceptional leverage to gold prices, built on a foundation of core mines that are among the longest-life, lowest-cost gold operations in the industry.

Financial highlights

Second quarter net earnings were $1,084-million (93 cents per share), compared with $138-million (12 cents per share) in the prior-year period. This significant increase in net earnings was primarily due to $882-million in gains related to the sale of a 50-per-cent interest in the Veladero mine, and the sale of a 25-per-cent interest in the Cerro Casale project.

Adjusted net earnings for the second quarter were $261-million (22 cents per share), compared with $158-million (14 cents per share) in the prior-year period. Higher adjusted net earnings were primarily the result of a 10-per-cent decrease in direct mining costs, driven by lower costs at Barrick Nevada and Pueblo Viejo, higher sales from the company's low-cost operations at Barrick Nevada, and lower relative sales from Acacia and Turquoise Ridge compared with the prior-year period. Higher gold and copper sales volumes and higher copper prices also contributed to stronger adjusted net earnings. This was partially offset by an increase in tax expense, higher depreciation, and an increase in exploration and evaluation costs.

Significant adjusting items (pretax and non-controlling interest effects) in the second quarter of 2017 include:

• $689-million in a gain relating to the sale of a 50-per-cent interest in the Veladero mine;
• $193-million in a gain relating to the sale of a 25-per-cent interest in the Cerro Casale project; partially offset by:
• $32-million in foreign currency translation losses primarily related to the devaluation of the Argentine peso on value-added-tax receivables;
• $26-million in losses on debt extinguishment.

Refer to page 48 of Barrick's second quarter management's discussion and analysis for a full list of reconciling items between net earnings and adjusted net earnings for the current- and prior-year periods.

Operating cash flow was $448-million, compared with $527-million in the second quarter of 2016. Lower operating cash flow was primarily due to higher cash taxes paid at Pueblo Viejo. During the quarter, the company made its final 2016 tax payment in the Dominican Republic, in addition to the company's first tax payment for 2017. Based on the company's current estimates, this should result in nominal tax payments at Pueblo Viejo for the rest of the year. Operating cash flow was further impacted by the concentrate export ban affecting Acacia's operations in Tanzania, an increase in working capital primarily related to leach pad inventories at Veladero, and an increase in exploration, evaluation and project costs. These decreases were partially offset by higher gold and copper sales volumes and higher copper prices, combined with lower direct mining costs, as described above.

Free cash flow for the second quarter was $43-million, compared with $274-million in the second quarter of 2016. The decrease primarily reflects higher capital expenditures, combined with lower operating cash flows. On a cash basis, capital expenditures for the second quarter were $405-million, compared with $253-million in the second quarter of 2016. This primarily reflects a planned increase in mine site sustaining capital expenditures at Barrick Nevada, relating to higher capitalized stripping costs and the timing of mine site sustaining projects in the current period, as well as greater spending at Veladero relating to phases 4B and 5B of the leach pad expansion and equipment purchases. The increase in capital expenditures also includes a $31-million increase in project capital, primarily at Barrick Nevada. This includes the Robertson property acquisition, the development of the Crossroads and the Cortez Hills Lower zone, and the Goldrush project, partially offset by a decrease in preproduction stripping at the Arturo pit, which entered commercial production in August, 2016. These increases reflect high-confidence investments in the company's most attractive opportunities to sustain and increase the value of the company's operations over the long term.

Restoring a strong balance sheet

Achieving and maintaining a strong balance sheet remain a priority. The company intends to reduce its total debt from $7.9-billion at the start of 2017 to $5-billion by the end of 2018, at least half of which the company is targeting this year. The company will achieve this by using cash flow from operations, further portfolio optimization, and the creation of new joint ventures and partnerships. The company will continue to pursue debt reduction with discipline, taking only those actions that make sense for the business, on terms the company considers favourable to its shareholders.

The company reduced its total debt by $309-million in the second quarter, or a total of $487-million year to date. On June 30, the company completed the sale of a 50-per-cent interest in the Veladero mine in Argentina to Shandong for $960-million, which will be allocated to debt reduction.

At the end of the second quarter, Barrick had a consolidated cash balance of approximately $2.9-billion. The company has less than $200-million in debt due before 2020. About $5-billion, or two-thirds of the company's outstanding total debt of $7.4-billion, does not mature until after 2032.

Operating highlights and outlook

Barrick produced 1,432,000 ounces of gold in the second quarter at a cost of sales of $726 per ounce. This compares with 1.34 million ounces at a cost of sales of $836 per ounce in the prior-year period. After removing non-controlling interests, cost of sales declined by 13 per cent on a per-ounce basis compared with the second quarter of 2016, primarily driven by a 10-per-cent reduction in direct mining costs and higher ounces sold.

All-in sustaining costs in the second quarter were $710 per ounce, compared with $782 per ounce in the second quarter of 2016. A 9-per-cent reduction in all-in sustaining costs was primarily driven by lower cost of sales per ounce, combined with lower general and administrative expenses, partially offset by an increase in mine site sustaining capital expenditures. Cash costs also decreased by 18 per cent, from $578 per ounce in the second quarter of 2016 to $474 per ounce in the second quarter of 2017.

The company continues to expect full-year gold production of 5.3 million to 5.6 million ounces, at a cost of sales of $780 to $820 per ounce and all-in sustaining costs of $720 to $770 per ounce. This does not include any revisions to Acacia's annual output as a result of the export ban on concentrates currently impacting Acacia's operations. The company expects production for the rest of the year to be weighted toward the fourth quarter. Based on sales mix and the company's current expectations for the timing of capital expenditures, the company expects costs to be higher in the third quarter.

The company produced 104 million pounds of copper in the second quarter, at a cost of sales of $1.85 per pound and all-in sustaining costs of $2.38 per pound. This compares with 103 million pounds, at a cost of sales of $1.43 per pound and all-in sustaining costs of $2.14 per pound in the second quarter of 2016.

Cost of sales applicable to copper increased by 28 per cent compared with the prior-year period, primarily due to higher depreciation expense and higher power and processing costs at Lumwana. Copper all-in sustaining costs, adjusted to include the company's proportionate share of equity method investments at Zaldivar and Jabal Sayid, were 10 per cent higher in the second quarter. This primarily reflects the higher cost of sales applicable to copper, combined with higher mine site sustaining capital expenditures at Jabal Sayid, which only began incurring sustaining capital expenditures upon entering commercial production in July, 2016, as well as higher capitalized stripping at Lumwana.

The company continues to expect full-year copper production of 400 million to 450 million pounds, at a cost of sales of $1.50 to $1.70 per pound and all-in sustaining costs of $2.10 to $2.40 per pound.

As part of the company's continuing efforts to increase transparency and strengthen the company's disclosures, Barrick intends to prerelease production and sales figures ahead of the company's quarterly earnings releases, beginning in the third quarter of 2017.

Please see page 32 of Barrick's second quarter management's discussion and analysis for individual operating segment performance details.

                              PRODUCTION AND 2017 GUIDANCE
 
                                Second quarter                    Current                   Original
                                          2017              2017 guidance              2017 guidance 
Gold
Production (000s of ounces)              1,432                5,300-5,600                5,600-5,900 
Cost of sales applicable to gold
($ per ounce)                              726                    780-820                    780-820 
All-in sustaining costs 
($ per ounce)                              710                    720-770                    720-770        
Copper       
Production (millions of pounds)            104                    400-450                    400-450 
Cost of sales applicable to copper
($ per pound)                             1.85                  1.50-1.70                  1.50-1.70 
All-in sustaining costs
($ per pound)                             2.38                  2.10-2.40                  2.10-2.40 
                                         -----               ------------               ------------
Total attributable capital expenditures
($ millions)                               393                1,300-1,500                1,300-1,500
                                         -----               ------------               ------------ 

Veladero operational update

On June 15, San Juan provincial government and judicial authorities lifted operating restrictions that had been imposed at the Veladero heap-leach facility in March, 2017. Following the lifting of restrictions, Veladero completed a gradual ramp-up of the mine's upgraded leach pad systems, testing the safety and integrity of the new infrastructure. Normal leaching operations at Veladero, including the addition of new cyanide to the heap-leach circuit, resumed in mid-July.

On a 100-per-cent basis, the company continues to expect full-year production at Veladero of 630,000 to 730,000 ounces of gold, at a cost of sales of $740 to $790 per ounce and all-in sustaining costs of $890 to $990 per ounce. Barrick's share of full-year production, reflecting 50-per-cent ownership from July 1, is expected to be 430,000 to 480,000 ounces of gold.

Tanzania concentrate export ban update

Barrick holds a 63.9-per-cent equity interest in Acacia Mining, a publicly traded company listed on the London Stock Exchange that is operated independently of Barrick. At this time, Acacia continues to evaluate the impact of Tanzania's concentrate export ban, as well as recently enacted legislation, on its 2017 production guidance. Acacia has not revised its full-year production guidance to reflect any change to annual output as a result of the concentrate export ban currently in place, but has stated that it is now targeting the lower end of its guidance range. Acacia has also indicated that, given the rate of cash outflow, it does not believe continued operations are sustainable at its Bulyanhulu mine beyond Sept. 30. Barrick continues to monitor the situation and should Acacia revise its full-year outlook, Barrick will evaluate the impact to its own guidance at that time. Any impact will depend, in large part, on the duration of the concentrate export ban. Acacia operations impacted by the current ban on concentrate exports (Bulyanhulu and Buzwagi) account for approximately 6 per cent of Barrick's 2017 gold production guidance. In total, Acacia accounts for approximately 10 per cent of Barrick's 2017 gold production guidance.

In an effort to seek a resolution that is in the best interests of all parties, including the government of Tanzania, Barrick and Acacia, Barrick will begin direct discussions with the government of Tanzania concerning the concentrate export ban and other issues next week. Barrick is doing so in its capacity as Acacia's largest shareholder. Acacia is not participating directly in the discussions at this stage; however, it intends to work with Barrick as necessary to support the process. Any potential resolution arising from these discussions will be subject to approval by Acacia.

Strategic co-operation agreement with Shandong

On June 30, the company completed the formation of the company's strategic partnership with Shandong. The sale of a 50-per-cent interest in the Veladero mine in San Juan province, Argentina, to Shandong Gold Mining Co. Ltd., for $960-million, was the first of three steps outlined in a strategic co-operation agreement signed by Barrick and Shandong Gold on April 6. In keeping with the second step in the agreement, the two companies have also formed a working group to explore the joint development of the Pascua-Lama deposit. As a third step, Barrick and Shandong will evaluate additional investment opportunities on the highly prospective El Indio gold belt on the border of Argentina and Chile, home to Pascua-Lama, Alturas and other projects.

Following the closing of the transaction, senior Shandong leaders travelled to Argentina to kick off the new partnership, participating in town hall meetings and welcome ceremonies with employees at the Veladero mine and San Juan offices. The delegation also met with San Juan Governor Sergio Unac, San Juan Mining Minister Alberto Hensel, and other provincial and federal government officials. The company's first joint venture planning and integration meeting was held on July 11.

Portfolio optimization

Cerro Casale joint venture

On June 9, Barrick completed the sale of a 25-per-cent interest in the Cerro Casale project in Chile to Goldcorp Inc., resulting in the formation of a new 50/50 joint venture to manage the project. Following the completion of Goldcorp's acquisition of Exeter Resource Corp., the joint venture will control more than 20,000 hectares of land in the Maricunga district, including the Caspiche and Cerro Casale deposits.

Robertson property acquisition

On June 8, Barrick completed the acquisition of the Robertson property and other claims in Nevada from Coral Gold Resources. The Robertson property is adjacent to Cortez, located just six kilometres north of the pipeline mill. If brought into production, ore from the project would provide an additional feed for the Cortez mill, with the potential to extend open-pit operations in the Cortez district. Robertson also has processing synergies with the Deep South underground expansion project at Cortez. In addition, the land package contains a number of promising near-mine exploration opportunities, as well as potential new exploration targets in this highly prospective and prolific district.

Alturas project update

The Alturas project, located on the border between Argentina and Chile on the El Indio belt, is a Barrick greenfield discovery with 6.8 million ounces of inferred gold resources (211 million tonnes, grading 1.0 gram per tonne) as of Dec. 31, 2016. The company has completed a scoping study for a conventional open-pit heap-leach operation at Alturas. The company believes it can add more value by applying innovative new mining and processing solutions to the project and through additional reverse circulation (RC) drilling. The company is now carrying out further studies to evaluate the feasibility of these potential enhancements. Establishing a more accurate-grade model using RC drilling will be one of the company's objectives for the next drilling season. The company's investment committee will continue to scrutinize the project as it advances, applying a high degree of consistency and rigour -- as the company does for all of its capital allocation decisions -- before further review by Barrick's executive committee and the company's board of directors at each stage of advancement.

Technical information

The scientific and technical information contained in this press release has been reviewed and approved by Steven Haggarty, PEng, senior director, metallurgy, of Barrick, Rick Sims, registered member SME, senior director, resources and reserves, of Barrick, and Patrick Garretson, registered member SME, senior director, life-of-mine planning, of Barrick, each a qualified person as defined in National Instrument 43-101 (standards of disclosure for mineral projects).

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