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BARRICK GOLD
sits down with Mark Bristow - CEO o
MINING | BARRICK GOLD
CK GOLD
of global gold mining champion Barrick
Addressing a small group of international journalists in a quiet corner of the opulent King Abdulaziz International Conference Center in Riyadh, the ever-ebullient CEO of Barrick Gold – Mark Bristow – reiterates the clear strategy underpinning the single most significant piece of M&A in the mining industry during the last decade. When global mining giant Barrick and Bristow’s former company, Africa-focused Randgold Resources, announced the US$18 billion merger deal at the end of 2018, the industry watched as five of the top 10 Tier 1 gold mines in the world were consolidated under a single umbrella, with the uncompromising Bristow at the helm of the new gold giant. “A Tier 1 company is a term that is abused at the moment,” he tells assembled media at the inaugural Future Minerals Forum in Saudi Arabia. “For clarity, it is a gold mining company that has more than 10 years of 500,000 ounces or more in its life of mine, and it delivers in the lower half of the cost curve. If you get a project like that in the gold industry, you make more than 15% IRR.” This concept sits at the crux of Bristow’s strategy for running a world-class
gold champion like Barrick, which now boasts six Tier 1 mines and a number of additional strategic gold and copper assets in 13 countries stretching from the Americas to Africa, the Middle East and Asia-Pacific. Barrick’s geographically diverse portfolio is informed by Bristow’s resolute global philosophy; he emphasises that in order to be deemed world-class, you need to be global. The thinking also extends to Barrick’s workforce: “To have the best assets, you must also have the best people,” Bristow says. In a continuation of the ‘Randgold Way’, Barrick invests in local talent, focuses on corporate cost efficiencies and cultivates an ownership mindset amongst management. This combination of best assets and best people delivers a clear outcome: industry-leading returns and sustainable future growth, which has been evidenced by three consecutive years of meeting production targets, leading to booming financial growth and a record $1.4 billion returned to shareholders in 2021.
Tier 1 mines and strategic assets Not one to rest on his laurels, Bristow followed up the Barrick-Randgold merger with an ‘opportunistic’ joint venture in Nevada with rival gold producer Newmont. At a stroke, the Nevada Gold Mines venture became the single largest gold mining complex in the world, with Barrick owning 61.5% and acting as operator. A foundation of value, the Nevada complex hosts three Tier 1 mines along with the Goldrush development being integrated into the Cortez mine and other brownfield discoveries, which will significantly extend the life of the mines without adding any big capital expenditure. “We’re now starting to look at 15-20 years [life of mine] in Nevada. For a gold mine, that sort of life really delivers value,” Bristow reasons. The remaining Tier 1 assets include Loulo-Gounkoto in
MINING | BARRICK GOLD
MARK BRISTOW, BARRICK GOLD CEO
Mali, which has 10 years of life
“The rest of the portfolio is
at least 10 years or 5 million
remaining and more reserves
what I’d call strategic. For
tonnes of annual contained
today than when Randgold
example, the Hemlo project
copper over at least 30 years)
first found it, Kibali in the
keeps us current in Canada,
with a 15% IRR. And they have
Democratic Republic of Congo
which is a country where
to be profitable at a gold price
(DRC) and Pueblo Viejo in the
we’d like to grow. Argentina is
of $1,200 per ounce.
Dominican Republic. Already
another dynamic country we
one of the lowest cost mines in
like a lot, just like here in Saudi For context, there were 11
the world, Pueblo Viejo is in a
Arabia.”
transitional phase as the plant
M&A deals in the gold industry in Q3 2021, which averaged
expansion and a planned new
Barrick’s strict investment
out at about $1,700 per ounce.
storage facility should extend
criteria demands Tier 1 assets
“This simply will not work for
the mine’s life beyond 2040.
(minimum 500,000 ounces of
Barrick,” Bristow asserts.
annual gold production over
MINING | BARRICK GOLD
Forging strong partnerships
jurisdictions it operates in,
maintenance while
although ‘wrinkles’ sometimes
discrepancy over the renewal
The ‘Barrick Way’ is also
occur – like in Tanzania and
of the mining licence was
defined by a clear two-way
Papua New Guinea (PNG) in
resolved.
relationship between the
recent times. A tax dispute
company and the host country,
involving a subsidiary and
“You can go anywhere in the
which is built on mutual trust
the Tanzanian government
world to mine, even unstable
and mutual gains. “One of our
was eventually resolved in
jurisdictions. If you have real
principal investment filters is
2019 when Barrick assumed
partnerships and a licence to
centred on the right to mine
control of the operations,
operate you can fix problems,
and the right to repatriate.”
and the relationship with the
and we’re very proud of what
government was repaired.
we’ve achieved with our
This is rarely an issue for
In PNG, the Porgera mine
partners in Tanzania and
Barrick across the varied
was placed on care and
PNG.”
Barrick’s partnership with
mine to improve output and
Exploration in and around
state-run mining company
overall efficiencies. “We’ve
Jabal Sayid continues to
Ma’aden is a key reason
taken the production from 100
progress, but Barrick is
behind Bristow’s trip to
million pounds per annum to
also pursuing gold and
Riyadh. Throughout the Future
150 million pounds, dropped
copper discoveries across
Minerals Forum, the CEO has
the grade, increased the
the Arabian Nubian Shield.
been engaging in productive
throughput and dropped the
Under its partnership with
conversations with the firm’s
cost,” Bristow explains.
the Saudi miner, the company
50:50 partner at the Jabal Sayid copper mine in Saudi Arabia.
will release any mineral “This has changed our
discoveries outside of gold and
relationship with Ma’aden
copper to the Ma’aden stable.
The operation has been
because they see what we can
commercially producing
bring. We still have the same
“We’ve spent the last two-and-
copper concentrate since July
reserves, in fact likely more,
a-half years understanding
2016, but since 2019 Barrick
than in 2019. We also brought
and evaluating the potential of
has focused on optimising the
in drill rigs and started looking
the Arabian Shield and we are
at the geology.”
comfortable that this is a place
BA R R I C K GOLD AT A G L A N C E
Arabian opportunities
where we should be investing. We look to partnerships first – profitability is a product
The project sits within the
of business, not the first
Arabian Shield - a generally
objective,” Bristow stresses.
unprospected geological
STOCK TICKER: NYSE:GOLD, TSX:ABX MARKET CAPITALISATION: US$41.43 BILLION (as of February 18, 2022) aj
domain that connects to the
The Ma’aden partnership
Nubian Shield across the
is important because it
Red Sea. Barrick geologists
positions Barrick in the
look at Centamin’s Tier 1
Middle East, which - along
Sukari gold mine in Egypt as
with the broader Southern
a huge incentive to ramp up
Asia region – forms part of a
exploration efforts in what
strategic long-term focus for
could be ‘elephant country’
the Toronto-headquartered
over the sea border in Saudi
company. Opportunities along
Arabia.
the Tethyan Belt, a geological
MINING | BARRICK GOLD
structure favourable for gold
which Bristow believes is
already existed in these places.
and copper mineralisation
a ‘critical future resource’
We harvested the talent and
stretching over 5,000 km from
for mining. Building local
showed we could build world-
Slovakia through the Balkans,
expertise, wherever the
class businesses in places like
Middle East, Asia Minor
address, is another core tenet
Mali and the DRC by investing
and on to Malaysia, are of
of the ‘Barrick Way’ Bristow
in local skills.”
particular interest.
developed in Africa during the Randgold days.
Barrick has just created a
‘The big S in ESG’ Training local talent and
new Asia-Pacific team to
“We didn’t drag a whole load
empowering underserved
lead the company’s foray
of expats with us to Africa
communities through
into underexplored regions
because we believed the
providing economic
along the massive belt,
full distribution of intellect
opportunity is viewed as an
MINING | BARRICK GOLD
indispensable part of Barrick’s while supporting personal
procured goods and services
modus operandi under
growth and development by
worth $847 million with
Bristow: “Every time you give
identifying skill and leadership
suppliers from communities
a man or woman a job you
gaps.
closest to its operations in
liberate them politically and
2020.
economically. That’s a big
Recent figures depict Barrick’s
challenge for me personally,
local employment drive in
Barrick has even pushed the
having grown up in Africa.”
effect: From 2018 to 2020,
envelope in Saudi Arabia with
hired employees from local
the employment of six women
The company pledges to create communities increased by
at Jabal Sayid, one of whom
robust talent pools by drawing 55% and local employees in
is an engineer. “Again, we are
from a diverse range of
leadership positions increased
making a big difference in our
candidates, including women
over 400%. In addition, Barrick
communities,” Bristow smiles.
and early career professionals,
MARK BRISTOW (RIGHT) SPEAKING ON THE MAIN STAGE AT FUTURE MINERALS FORUM
Environmental stewardship
theme of the Future Minerals
While important global
Forum, particularly after the
decision-makers seem to
Mining’s contribution to the
industry was effectively shut
remain wilfully ignorant of
low carbon economy of the
out of discussions at the COP26
the importance of mining for
future has been a central
conference in November.
the global energy transition,
MINING | BARRICK GOLD
Bristow calls on his colleagues
Bristow is asked whether
The combination of world-
to become louder advocates
Barrick plans to increase
class mines and disciplined
for the positive actions the
investments in the copper
management continues to
sector is taking, including the
side of the business, which
result in operational success,
adoption of carbon reduction
currently accounts for around
as demonstrated by the recent
targets among the biggest
20% of revenues, with gold
announcement that Barrick’s
players.
making up the remaining 80%.
total annual gold production of 4.44 million ounces met
“We are proud to have a
“There’s been no shift in
the company’s guidance
clear plan to reduce carbon
strategy,” he confirms. “If you
range for 2021. This puts the
emissions 30% by 2030. We’ve
want to keep growing a gold
miner in a strong position
got 25% accounted for, with
company, you’ve got to go into
to focus on growth areas in
the remaining 5% still be
porphyries, which come up
2022 and ensure it keeps on
worked out. And we haven’t
with copper. In these systems,
delivering the best returns to
touched electric vehicles yet in
copper and gold are mined
shareholders, as the global
our calculations.”
together and exploration
economy exits the COVID-19
programmes are no different.
pandemic.
Over the next four years, the
We have employed a few
burgeoning electric vehicle
additional porphyry skills into
“Mining is a consumptive
and renewable energy
the business but there’s no
industry, so you always have
industries will account for
new formula with regards to
to invest in replacing what
72% of growth in total refined
our gold-copper ratio.”
you mine. We have our clearly
copper demand, according
defined investment filters and
CRU. This upward demand
From strength to strength
trajectory coupled with
All of the topics Bristow
limited new mine supply
touches on during the informal a fact. If you’re a long-term
avenues is set to contribute to
two-hour media briefing
player, you need to be wary
a sustained high copper price
tie into a wider portrait of
of that and we most certainly
environment.
Barrick as a sustainably run,
are,” he concludes.
to commodities consultancy
global gold mining champion With this tightening supply-
comprised of the best assets
demand dynamic in mind,
and the best people in the industry.
this is key for us, because the big margins we are benefitting from now will close. That’s
Published by Anderson Murray Media Ltd
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