The Barrick Gold logo is seen during the company's annual general meeting in Toronto on Tuesday, April 28, 2015. THE CANADIAN PRESS/Nathan Denette

Barrick Gold expects growing exposure to copper as price escalation boosts Q1 profits

Barrick Gold expects growing exposure to copper as price escalation boosts Q1 profits

TORONTO — The CEO of Barrick Gold Corp. says copper stands to grow in importance for the world’s second-biggest gold miner after 10-year-high prices for copper bolstered its first-quarter earnings.

Barrick plans to continue its copper-directed exploration efforts while banking increasing revenue from existing mines as prices rise to more than US$4.50 per pound, Mark Bristow said on a conference call to discuss Barrick’s results from the first three months of the year.

“We see our own copper portfolio as a source of differentiation to our gold industry peers, providing shareholders with meaningful exposure from assets that are in production today,” he said.

“Based on the current spot pricing, copper is expected to represent at least 20 per cent of our gold-equivalent ounces sold from 2021 to 2025, up from the 16 per cent contribution in 2020, based on actual realized prices.”

Toronto-based Barrick on Wednesday reported a first-quarter profit of US$538 million, up from US$400 million a year ago, as revenue rose to nearly US$2.96 billion from US$2.72 billion.

Copper revenues increased 31 per cent compared with the fourth quarter of 2020 as Barrick’s realized price rose to US$4.12 per pound from US$3.39 in the previous quarter and US$2.23 in the year-earlier period.

The increase came as copper production slipped to 93 million pounds from 119 million in the fourth quarter and 115 million in the first quarter of 2020, although copper sales were higher at 113 million pounds in the most recent quarter, up from 110 million pound a year ago.

Gold production, meanwhile, fell to 1.1 million ounces from 1.2 million in the year-earlier period but the realized price was US$1,777 per ounce, up 12 per cent from US$1,589.

Last month, Barrick said its suspended Porgera gold mine in Papua New Guinea will resume operations later this year after negotiations to settle a dispute with the national government resulted in the state taking a much larger ownership stake.

The compromise to deliver “a fair split on economics,” as well as flexibility in other jurisdictions around the world, are necessary to ensure the mining industry maintains a proper balance of benefits with the countries in which it operates, said Bristow.

“Again, we are going to have to do more of that as an industry if we want to remain relevant and be able to operate across the globe,” he said.

Barrick is making good progress in plans to restart the Porgera mine but is not yet prepared to include its production in its annual guidance, Bristow said.

Under the renegotiated agreement, the 95 per cent stake in the mine held by a 50-50 joint venture owned by Barrick and China’s Zijin Mining Group Ltd. drops to 49 per cent and the government’s ownership jumps from five per cent to 51 per cent.

The economic benefits generated over the life of mine are to be split on a 53-47 per cent basis with the larger share going to the government.

On Tuesday at its annual general meeting, Barrick shareholders voted 99 per cent in favour of a US$750-million return of capital. The first US$250-million tranche is to be paid on June 15 to shareholders of record on May 28, the company announced.

By Dan Healing in Calgary.

This report by The Canadian Press was first published May 5, 2021.

Companies in this story: (TSX:ABX)

The Canadian Press

Just Posted

Mental health support centre in central Alberta to receive funding

Shoppers Drug Mart is lending support to the Canadian Mental Health Association.… Continue reading

Downtown Red Deer was packed with people who lined the streets to watch the Westerner Days parade on Wednesday. (Photo by SUSAN ZIELINSKI/Advocate staff)
Westerner Days parade cancelled, full details on modified event coming June 28

The 2021 edition of Westerner Days will look much different than any… Continue reading

City council wants to hear from the public at a May 25 hearing about whether the temporary homeless shelter should be allowed to remain in the downtown for another year. (Advocate file photo).
City of Red Deer staff to recommend another extension to allow operations at current temporary shelter site

Following some more research city administration has received no other new locations… Continue reading

A scene from the short Western ‘Cheaters, Robbers and Outlaws,’ written and directed by Jason Steele, with support from Telus Storyhive. (Contributed image)
Red Deerians make ‘Cheaters, Robbers and Outlaws’ short Western film

Writer and director Jason Steele received a $20,000 Storyhive grant from Telus

Residents in several neighbourhoods reported little to no water pressure Tuesday night. (File photo by Advocate staff)
City hall to reopen for payments and customer service

Red Deer City Hall will reopen on June 21 for utility and… Continue reading

Harley Hay
Harley Hay: You can’t trust Mondays

Monday isn’t my favourite day. It insists on occurring right after a… Continue reading

Montreal Canadiens goaltender Carey Price stops Vegas Golden Knights' William Karlsson as he is covered by Canadiens' Joel Edmundson during first period of Game 3 of the NHL Stanley Cup semifinal Friday, June 18, 2021 in Montreal. THE CANADIAN PRESS/Paul Chiasson
Andreson’s timely scoring, Price’s goaltending give Habs 2-1 series lead over Vegas

Canadiens 3 Golden Knights 2 (OT) (Montreal leads series 2-1) MONTREAL —… Continue reading

Atlanta Hawks guard Trae Young (11) is defended by Philadelphia 76ers guard Ben Simmons (25) as he looks for an opening during the first half of Game 6 of an NBA basketball Eastern Conference semifinal series Friday, June 18, 2021, in Atlanta. (AP Photo/John Bazemore)
Curry, Harris help 76ers stay alive, hold off Hawks 104-99

76ers 104 Hawks 99 (Series tied 3-3) ATLANTA — Seth Curry hit… Continue reading

Canadian Prime Minister Justin Trudeau is seen during a joint news conference following the EU-Canada Summit, in Brussels, Belgium, Tuesday June 15, 2021. Trudeau says Canada is on track now to have 68 million doses delivered by the end of July, which is more than enough to fully vaccinate all 33.2 million Canadians over the age of 12. THE CANADIAN PRESS/Adrian Wyld
Vaccine deliveries enough to fully vaccinate all eligible Canadians by end of July

OTTAWA — Prime Minister Justin Trudeau’s promise of a two-dose fall is… Continue reading

Marco Mendicino, Minister of Immigration, Refugees and Citizenship, speaks during a press conference in Ottawa, Thursday, May 13, 2021. Mendicino has announced a new policy to help settle 500 refugees and their families in a news conference today. THE CANADIAN PRESS/Sean Kilpatrick
Canada to welcome 45,000 refugees this year: Immigration Minister Marco Mendicino

Immigration Minister Marco Mendicino announced plans to expedite applications and increase the… Continue reading

Louis Oosthuizen, of South Africa, plays his shot from the third tee during the second round of the U.S. Open Golf Championship, Friday, June 18, 2021, at Torrey Pines Golf Course in San Diego. (AP Photo/Marcio Jose Sanchez)
Bland leads at Torrey and shows the US Open is truly open

SAN DIEGO — The U.S. Open prides itself on being the most… Continue reading

The Prime Minister's car waits outside the National Microbiology Laboratory in Winnipeg Tuesday, May 19, 2009. The head of the Public Health Agency of Canada is showing no sign he'll release unredacted documents about the firing of two scientists at Canada's highest security laboratory — despite the prospect of being publicly shamed in the House of Commons for his refusal to turn them over. THE CANADIAN PRESS/John Woods
PHAC head maintains he’s bound by law not to release docs on fired scientists

OTTAWA — The head of the Public Health Agency of Canada is… Continue reading

Chief Public Health Officer Theresa Tam listens to a question during a news conference, in Ottawa, Tuesday, Jan. 12, 2021. The number of confirmed COVID-19 cases attributed to the highly contagious Delta variant grew in Canada this week. THE CANADIAN PRESS/Adrian Wyld
Public health agency reports spike in confirmed cases of Delta variant in Canada

OTTAWA — The number of confirmed COVID-19 cases attributed to the highly… Continue reading

Most Read