Barrick Gold CFO Jamie Sokalsky told analysts Wednesday the company has taken$93 million in impairment charges in the first quarter, "primarilyrelated to the write-down of an investment in Highland Gold." The world's top gold miner sold its entire 20.4% shareholding inRussian gold producer Highland, consisting of 66.2 million sharesat a price of 120 pence per share for total gross proceeds ofUS$130 million. The shares were sold primarily to new and existinginstitutional shareholders of Highland. Sokalsky said the write-down was partially offset by $36 million ingains from the sale of assets, forex gains and unrealized gains onnon-hedge derivative instruments. During Wednesday's conference call, Barrick CEO Aaron Regent alsoannounced that Barrick COO Peter Kinver would be retiring and wouldbe replaced by Igor Gonzales, the former chief of Barrick's SouthAmerican unit. During his nine-year career at Barrick, Kinver oversaw theconstruction of six new mines in five countries "and successfullyled the integration of Placer Dome's operations into Barrick'sglobal portfolio," Regent noted. LED Tube Lights T8
Kinver will work as a consultantfor Barrick during the duration of construction activities at thePueblo Viejo and Pascua-Lama projects. "Under Igor's leadership, the South American region hasconsistently demonstrated strong performance in production, costcontrol, project development and in the corporate socialresponsibility arena where he was focused on building positiverelationships with local communities," Regent observed, The company reported gold and copper production of 1.88 millionounces and 117 million pounds, respectively, during the firstquarter, compared to 1.96 million ounces of gold production and 75million pounds of copper output during the same quarter of lastyear. Gold total cash costs averaged $545 per ounce during thefirst quarter of 2012, while copper C1 cash costs averages $2.08per pound. First quarter production at the company's flagship Goldstrike minewas impacted by increased maintenance activities and constructionto preparation autoclaves as a part of the implementation of theGoldstrike thiosulfate project. Output was also impacted byoperational disruptions at the Porgera operation in Papua NewGuinea Despite the drop in gold production Barrick is maintaining itsfull-year 2012 gold production guidance of 7.3 million to 7.8million ounces at average total cash costs of $520 to $530 perounce. China High Bay LED Lights
However, Sokalsky observed that gold production in the secondquarter is expected to be even lower than first-quarter goldproduction, "primarily due to mine sequencing at Lagunas Norte andCortez and some planned maintenance of the roaster at Goldstrike." "Overall, gold production is expected to increase in the secondhalf of the year," he added, "mainly as the result of Goldstrikeand Lagunas Norte retuning to higher production levels and also,with the commencement of production at Pueblo Viejo." "Our second quarter total cash costs per ounce are expected to behigher than the first quarter," Sokalsky advised, "in line with thelower anticipated production levels, but are expected to decreasethereafter from the second quarter levels in the second half of theyear as lower cost mines contribute a greater proportion of overallproduction." He also advised Barrick continues to expect full year copperproduction of 550 million to 600 million pounds. "Our total copperproduction is expected to increase in the second half of the yearprimarily due to higher production at Lumwana and also the startupof production at Jabal Sayid." Sokalsky noted that Barrick has now "adopted the Brooks Hunt C1cash cost methodology for calculating copper cash cost per pound inorder to better conform our presentation to other significantcopper producers." In response to analysts' questions, Regent said Barrick's CerroCasale project is much further advanced than its Donlin Creek jointventure with NovaGold. "Casale permitting will likely be completedtowards the end of this year, so that project will be in a positionto make a construction decision a lot sooner, where Donlin isprobably going to take us three to four years to permit, so we're abit further away from making a construction decision." FINANCIALS Barrick announced Wednesday that it would pay a quarterly dividendof 20-cents per share on June 15, 2012, a 33% increase from theprevious dividend. The company reported adjusted net earnings of $1.09 billion or$1.09 per share for the first quarter of the year, an 8% increasefrom the adjusted net earnings of $1 billion or $1.01 per sharereported in the prior year period. First-quarter 2012 net earnings were reported at $1.03 billion or$1.03 per share, a three percent increase from net earnings of $1billion or $1 per share, reported in the first quarter of 2011. LED Tube Lights T8
The company also announced that this year's exploration budget of$450 million to $490 billion is about 40% allocated to majorexploration programs at Goldrush and Turquoise Ridge in Nevada andat the Lumwana mine in Zambia. The 2011 exploration program wasfunded at the $350 million level. SUBSCRIBE to Mineweb.com's free daily newsletter now.
Kinver will work as a consultantfor Barrick during the duration of construction activities at thePueblo Viejo and Pascua-Lama projects. "Under Igor's leadership, the South American region hasconsistently demonstrated strong performance in production, costcontrol, project development and in the corporate socialresponsibility arena where he was focused on building positiverelationships with local communities," Regent observed, The company reported gold and copper production of 1.88 millionounces and 117 million pounds, respectively, during the firstquarter, compared to 1.96 million ounces of gold production and 75million pounds of copper output during the same quarter of lastyear. Gold total cash costs averaged $545 per ounce during thefirst quarter of 2012, while copper C1 cash costs averages $2.08per pound. First quarter production at the company's flagship Goldstrike minewas impacted by increased maintenance activities and constructionto preparation autoclaves as a part of the implementation of theGoldstrike thiosulfate project. Output was also impacted byoperational disruptions at the Porgera operation in Papua NewGuinea Despite the drop in gold production Barrick is maintaining itsfull-year 2012 gold production guidance of 7.3 million to 7.8million ounces at average total cash costs of $520 to $530 perounce. China High Bay LED Lights
However, Sokalsky observed that gold production in the secondquarter is expected to be even lower than first-quarter goldproduction, "primarily due to mine sequencing at Lagunas Norte andCortez and some planned maintenance of the roaster at Goldstrike." "Overall, gold production is expected to increase in the secondhalf of the year," he added, "mainly as the result of Goldstrikeand Lagunas Norte retuning to higher production levels and also,with the commencement of production at Pueblo Viejo." "Our second quarter total cash costs per ounce are expected to behigher than the first quarter," Sokalsky advised, "in line with thelower anticipated production levels, but are expected to decreasethereafter from the second quarter levels in the second half of theyear as lower cost mines contribute a greater proportion of overallproduction." He also advised Barrick continues to expect full year copperproduction of 550 million to 600 million pounds. "Our total copperproduction is expected to increase in the second half of the yearprimarily due to higher production at Lumwana and also the startupof production at Jabal Sayid." Sokalsky noted that Barrick has now "adopted the Brooks Hunt C1cash cost methodology for calculating copper cash cost per pound inorder to better conform our presentation to other significantcopper producers." In response to analysts' questions, Regent said Barrick's CerroCasale project is much further advanced than its Donlin Creek jointventure with NovaGold. "Casale permitting will likely be completedtowards the end of this year, so that project will be in a positionto make a construction decision a lot sooner, where Donlin isprobably going to take us three to four years to permit, so we're abit further away from making a construction decision." FINANCIALS Barrick announced Wednesday that it would pay a quarterly dividendof 20-cents per share on June 15, 2012, a 33% increase from theprevious dividend. The company reported adjusted net earnings of $1.09 billion or$1.09 per share for the first quarter of the year, an 8% increasefrom the adjusted net earnings of $1 billion or $1.01 per sharereported in the prior year period. First-quarter 2012 net earnings were reported at $1.03 billion or$1.03 per share, a three percent increase from net earnings of $1billion or $1 per share, reported in the first quarter of 2011. LED Tube Lights T8
The company also announced that this year's exploration budget of$450 million to $490 billion is about 40% allocated to majorexploration programs at Goldrush and Turquoise Ridge in Nevada andat the Lumwana mine in Zambia. The 2011 exploration program wasfunded at the $350 million level. SUBSCRIBE to Mineweb.com's free daily newsletter now.