World Class Assets
Our ongoing portfolio review process is designed to further
optimize Barrick’s high quality asset portfolio and provide
higher returns and free cash flow.
GLOBAL PORTFOLIO OF PREMIER ASSETS
Barrick’s portfolio of 27 operating mines, advanced
exploration and development projects and extensive
land positions on five continents around the globe
includes some of the world’s premier gold assets.
Once Pueblo Viejo is at full capacity, Barrick will
oper­ate three of the world’s six mines that are one
million ounce or more per year producers. Our top
four mines – Cortez, Goldstrike, Lagunas Norte and
Veladero – together produced 4.1 million ounces in
2012 at an average total cash cost of $406 per ounce.
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These mines, plus Pueblo Viejo and Pascua-Lama,
form an unmatched core group of six high quality
assets with long lives and low costs, that alone
would be the world’s largest gold producer. The
goal of our ongoing portfolio review process,
launched in mid-2012, is to further optimize the
quality of our entire portfolio. Assets that do not
generate acceptable risk-adjusted returns or free
cash flow will be deferred, shelved or divested.
Barrick met its gold production guidance in 2012
for the tenth year in a row with an industry-leading
“Bringing Pueblo Viejo into production within
guidance and with an excellent safety record is
an outstanding achievement for the company.
This large, low-cost mine represents the type of
high quality asset in which we want to invest
our shareholders’ capital.”
Igor Gonzales, Executive Vice President and Chief Operating Officer
7.4
945
Barrick produced
an industry-leading
7.4 million ounces
of gold in 2012.
All-in sustaining
cash costs were
$945 per ounce.
7.4 million ounces of gold. All-in sustaining cash
costs were $945 per ounce and total cash costs of
$584 per ounce were the lowest among the senior
gold producers. These strong results reflect the high
quality of our assets. Going forward, Barrick’s cost
structure is expected to benefit from combined
average annual production of about 1.5 million1
new ounces from Pueblo Viejo and Pascua-Lama
at average all-in sustaining cash costs of $250 –
$350 per ounce2 and average total cash costs of
$100 – $200 per ounce2.
GOLD PRODUCTION BY REGION IN 2012
North America 47%
South America 22%
Australia Pacific 25%
African Barrick Gold 6%
GOLD BUSINESS
Our North America unit is the company’s largest
producing region and generated 3.5 million ounces,
or 47 percent of total 2012 production, at total
cash costs of $500 per ounce. Nevada is home to
seven of the region’s nine mines and contributed
3.1 million ounces or 42 percent of total production
in 2012. Cortez remains our lowest cost mine and
exceeded expectations for the third straight year
with production of 1.37 million ounces at total cash
costs of $282 per ounce. Significant exploration
1. About 1.5 million ounces is based on the estimated cumulative annual average
production in the first full five years once both mines are at full capacity.
2.Based on first full five year averages once both mines are at full capacity.
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WORLD CLASS ASSETS
1.37
3.1
The Cortez mine
produced 1.37 million
ounces at total cash
costs of $282 per
ounce in 2012.
Our Nevada mines
produced 3.1 million
ounces or 42% of
total production
in 2012.
success at the nearby Goldrush discovery has
further demonstrated the potential of this truly
world-class district.
At Goldstrike, construction advanced on the
thiosulfate project to enable continued production
from the autoclaves, which were originally expected
to cease operations in 2012. Modifications to the
autoclave circuit will accelerate about 3.5 million
ounces in the mine plan and contribute an average
of about 350,000 – 400,000 ounces annually in
The Cortez mine in Nevada exceeded expectations
for the third straight year. The processing facilities are
shown in the foreground.
Lagunas Norte has
produced more than
50 percent above
feasibility expectations and has done
so in every year since
it entered production.
the first full five years. First gold production is
expected in mid-2014. The North America region
contains a number of excellent prospects for future
production, including Goldrush and the Lower Zone
underground expansion at Cortez.
The three mines in South America produced
1.6 million ounces, or 22 percent of the company’s
total 2012 production, at total cash costs of
$467 per ounce. The Lagunas Norte mine had
another strong year, contributing 754,000 ounces
at low total cash costs of $318 per ounce, while
Veladero produced 766,000 ounces at total cash
costs of $510 per ounce. Both mines have significantly exceeded feasibility study expectations for
production since they began operations in 2005.
Lagunas Norte has outperformed original estimates
for the last seven years and, on a cumulative basis,
has produced more than 50 percent above expectations. Veladero has outpaced feasibility estimates
for the last four years and cumulatively has produced
about 20 percent more than anticipated.
Australia Pacific’s eight mines produced 1.8 million
ounces in 2012, or 25 percent of total production,
at total cash costs of $803 per ounce. The
Porgera mine in Papua New Guinea continued to
lead production in the region with production
of 436,000 ounces at total cash costs of
$955 per ounce.
Barrick’s 73.9 percent share of production from
the four mines within African Barrick Gold Plc (ABG)
was 0.5 million ounces, or 6 percent of total
production, at total cash costs of $949 per ounce.
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Lab technician Maria
Louise Rodriguez
works with ionic
chromatography
equipment at
Pueblo Viejo.
INVESTING IN
HIGH RETURN PROJECTS
Barrick added another world-class operation to its
portfolio in 2012 with the successful completion
of its 60 percent-owned Pueblo Viejo mine in the
Dominican Republic. Pueblo Viejo is one of only
a handful of mines globally that will produce more
than one million ounces of gold per year and its
state-of-the-art processing facility houses four of the
largest autoclaves in the world. Based on reserves of
3. See pages 163–170 of the 2012 Annual Report for additional information
on reserves and resources.
4. Actual production may vary depending on the progress of the ramp-up.
0.50 – 0.65
Barrick’s share of 2013 production
from Pueblo Viejo is expected to be
0.50 – 0.65 million ounces.
25.0 million ounces3 (100 percent basis), this mine
is anticipated to be a major contributor of low-cost
production to Barrick for many years to come.
Completed at a capital cost of $3.7 billion, Pueblo
Viejo is expected to provide 1,900 jobs and 10,000
indirect jobs over its anticipated 25+ year mine life.
Pueblo Viejo poured its first gold in August 2012
and is scheduled to ramp up to full capacity in the
second half of 2013 with expected production
of 500,000 – 650,000 ounces4 in 2013. In the first
Pueblo Viejo’s state-of-the-art processing facility
houses four of the largest autoclaves in the world.
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WORLD CLASS ASSETS
A collar for one
of the ball mills
at Pascua-Lama is
inspected prior to
installation.
full five years of operation, Barrick’s share of
annual production is anticipated to be 625,000 –
675,000 ounces at all-in sustaining cash costs of
$500 – $600 per ounce5 and total cash costs
of $300 – $350 per ounce5.
The Pascua-Lama project on the border of Chile and
Argentina is expected to be one of the world’s
Assembly of the grinding building at Pascua-Lama
is well advanced; the covered ore stockpile building
is shown in the background.
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3 of 6
25
Barrick operates half
of the world’s mines
that can produce
more than one million
ounces a year.
Pueblo Viejo and
Pascua-Lama each
have a mine life
of at least 25 years.
lowest operating cost gold mines and will generate
significant free cash flow for Barrick once it ramps
up to full production. First production is targeted
for the second half of 2014 and mine construction
capital is estimated at $8.0 – $8.5 billion. The
project is expected to generate 1,600 direct jobs
and 4,000 indirect jobs over its 25 year mine life
and Barrick is providing skills training programs,
opportunities for local businesses and investing in
Copper cathodes
from Zaldívar are
prepared for rail
shipment to the port
at Antofagasta
in Chile.
468
Barrick produced
468 million pounds
of copper in 2012
from its two
copper mines.
communities around the project. The project hosts
a large gold reserve of nearly 18 million ounces
and 676 million ounces of silver contained within
the gold reserves.
In its first full five years of operation, Pascua-Lama is
expected to produce an annual average of 800,000 –
850,000 ounces of gold at all-in sustaining cash costs
of $50 – $200 per ounce6 and total cash costs of $0
to negative $150 per ounce6. The mine will also be
one of the world’s top silver producers, with average
annual production of about 35 million ounces over
the same period. At the end of 2012, construction
was approximately 40 percent complete.
COPPER BUSINESS UNIT
Barrick strengthened the management of its Global
Copper Business Unit (CBU) in 2012 to exclusively
focus on optimizing this business, which includes
the Zaldívar mine in Chile, the Lumwana mine in
Zambia, and the Jabal Sayid project in Saudi Arabia.
The leach pad at Zaldívar is refreshed with ore
in a constant cycle of delivery and reclaim.
Total 2012 copper production was 468 million
pounds at C1 cash costs of $2.17 per pound and
C3 fully allocated costs of $2.97 per pound. The
Zaldívar mine produced 289 million pounds at
C1 cash costs of $1.62 per pound and Lumwana
contributed 179 million pounds at C1 cash costs
of $3.07 per pound.
and an updated mine plan, the company is in a
better position to identify necessary changes that
will improve free cash flow over the life of the mine.
Higher utilization and productivity of the mining
fleet and a full transition to owner maintenance
have been identified as major opportunities to
improve value.
Our focus at Lumwana is on significant cost reduction
in order to realize its potential. With an enhanced
understanding based on drilling completed in 2012
At Jabal Sayid, production is expected to commence
in 2014 once the mine is compliant with Saudi
Arabia standards for safety and security. Average
annual production from Jabal Sayid is anticipated
to be 100 – 130 million pounds at C1 cash costs
of $1.50 – $1.70 per pound7 in its first full five
years of operation.
5. Based on first full five year averages and gold and oil price assumptions of $1,700/oz
and $90/bbl, respectively. Does not include escalation for future inflation.
6. Based on first full five year averages and gold, silver and oil price assumptions
of $1,700/oz, $30/oz and $90/bbl, respectively, and assuming a Chilean peso f/x
rate of 475:1. Does not include escalation for future inflation.
7.Does not include escalation for future inflation.
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