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Barrick could sell Plutonic gold mine

Barrick Gold is continuing to look at cost cutting as gold prices dipped in the past three quarters.

The company has indicated it might sell its Plutonic mine in Western Australia as well as its three Yilgarn mines, which went up for sale earlier this year.

Speculation mounted last month Barrick was about to sell its Western Australian assets, with Tribune Resources tipped to buy the East Kundana gold mine.

Reports emerged in April this year the company plans to sell its three Yilgarn mines. The gold miner recruited UBS and Merrill Lynch to counsel them on the sale of its Yilgarn South assets.

These include the Darlot, Granny Smith and Lawlers mines.

Barrick revealed it sustained a $US8.6 billion ($9.6 billion) loss, in the wake of $US8.7 billion worth of asset write-downs after gold prices slumped, The Advocate reported.

The company also revealed it would concentrate on four mines, which have production costs below $US700 an ounce of gold produced.

These four mines create 60 per cent of the company’s yield.

The company is also looking at ways to divest or modify production at its other mines like Plutonic and Yilgarn to increase revenue, Barrick told investors at the June quarter earnings release.

It is looking at its huge Porgera in Papua New Guinea and will “evaluate mine-plan changes and explore other alternatives”.

“A process to divest certain Australian assets is well advanced,” Barrick said.

According to the June quarter results, its Australian and Pacific mines created 0.47 million ounces of gold at $US1033 an ounce, while Porgera produced 0.12 million ounces at a higher price of $US1306 an ounce.

The falling Australian dollar helped the company cut costs, it said.

“We continue to expect full-year production to be in the range of 1.70-1.85 million ounces and now expect [all-in cost] to be in the range of $US1100-$1200 per ounce, lower than our previous range of $US1200-$1300 per ounce.”

Barrick Gold retrenched 32 jobs from its Perth head office earlier this year when gold hit a three-year low to trade at $US1,229.6 an ounce.

It also cut 33 jobs from its mid-west Plutonic mine, 22  workers from its Kanowna operation east of Kalgoorlie-Boulder, 100 jobs from its corporate offices in Toronto and 55 jobs from its Nevada and Utah offices.

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