Barrick to sell part of Chilean copper mine – Zaldivar

In a move to reduce its $13-billion (U.S.) debt burden, Barrick Gold Corp. plans to sell off part of its prized Chilean copper mine. — Photo courtesy Barrick Gold Corp.

Barrick Gold Corp. plans to sell off part of its prized Chilean copper mine, in a move to reduce its $13-billion (U.S.) debt burden, the Globe and Mail newspaper is reporting.

The partial sale of the Zaldivar copper mine will restrict Barrick’s cash flow at a time when it is coping with a slump in copper and gold prices.

However, Zaldivar, which used to be called the Andean ATM because it generated so much cash, is expected to attract top bids and help Barrick strengthen its finances under a revitalization plan laid out by chairman John Thornton.“Potential buyers have expressed a strong interest,” Barrick said in a statement announcing its quarterly results.

The world’s biggest gold producer plans to cut its debt by $3-billion this year and said “no priority is more important than restoring our balance sheet." The Toronto company has already put its Australian and Papua New Guinea mines up for sale. The partial sale of Zaldivar is a major step away from the copper business for the Canadian mining giant.

For the first three months of the year, Barrick earned $57-million or 5 cents per share, compared with $88-million or 8 cents a year earlier. Financial analysts had expected Barrick to earn 9 cents per share.

The miner said it was on track to produce as much as 6.6-million ounces of gold this year at an average cost of around $878 per ounce, according the Globe and Mail report.

Source: Globe and Mail