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The proposed expansion of Barrick Gold’s (NYSE: GOLD) (TSX: ABX) Lumwana copper mine is being accelerated with first production now scheduled for 2028, chief executive Mark Bristow advised Zambian President Hakainde Hichilema in their meeting Tuesday.
According to Barrick, the Super Pit expansion project will transform Lumwana into one of the world’s major copper mines, with projected annual production of around 240,000 tonnes per year over a 30-plus-year life. It will be key component to the Zambian government’s drive to revive the country’s copper industry over the next 10 years.
Since 2019, Lumwana has contributed almost $3 billion to the Zambian economy in the form of royalties, taxes, salaries and the procurement of goods and services from local businesses. Last year, local procurement made up more than 81% of total spend for the copper mine.
In association with the expansion, Barrick has also launched a business accelerator program designed to build the business capacity of the Zambian contractors in its supply chain, equipping them to grow and diversify their enterprises and remain sustainable beyond Lumwana’s life of mine.
“In line with Barrick’s partnership philosophy, our REDD+ initiative will uplift our host communities through conservation of the natural forest surrounding the mine. Resources have already been allocated and engagement with the communities is underway,” Bristow stated in a news release.
As the company had detailed last year, the estimated cost of the Lumwana expansion is almost $2 billion. Construction is scheduled to start towards the end of 2024. A full feasibility study is also expected by the end of the year.
Since Barrick refocused its strategy in 2019, Lumwana, the once struggling mine, has been restructured and re-engineered into a significant contributor to Barrick’s expanding copper portfolio. The ramp-up of the re-opened Malundwe pit and completion of the transition to owner mining supported the achievement of its production guidance for 2023.
In addition, the Canadian gold giant has also expressed its desire to add more copper assets to its African portfolio, thus expanding its presence on the continent’s copper belt. The goal is to double its copper production by 2031 to 1 billion pounds.
Shares of Barrick Gold were up 1% on the TSX by 11:30 a.m. ET. The company’s market capitalization stood at C$37.3 billion ($27.6bn).
