Barrick Gold, the world’s largest gold company, reported net earnings during Q2 rose 35% to $1.2 billion ($1.16 per share) from $859 million in the prior year period, due to increased sales and higher gold and copper prices.
Q2 gold production was 1.98 million ounces at total cash costs of $445 per ounce and net cash costs of $338 per ounce. The company said it is on track to meet its 2011 operating guidance of 7.6-8.0 million ounces at total cash costs of $450-$480 per ounce and lower expected net cash costs of $290-$320 per ounce compared to previous guidance of $340-$380 per ounce. Including Lumwana, Barrick expects to produce 455-475 million pounds of copper in 2011 at total cash costs of $1.55-$1.70 per pound.
Capital costs increased at the Pueblo Viejo project. Heavy rains in May required remediation of the starter tailings dam and new permits for this facility. Primarily as a result of the unanticipated remediation work and impact to the schedule, mine construction capital for the project has increased to $3.6-$3.8 billion (100% basis) or $2.2-$2.3 billion (Barrick’s 60% share) and first production is now expected to occur in mid-2012 subject to the receipt of these permits.
Capital costs at Pascua-Lama also increased. Growing cost inflation for steel, cement, fuel, equipment and labour resulted in pre-production capital rising to $4.7-$5.0 billion.
Story is by Michael McCrae with material from Marketwire. Read the full news release here.
