In this Jan. 29, 2014 photo, a drill finishes up the blast pattern at Barrick Gold Corp.'s Cortez Hills, Nev., open pit site.Ross Andreson/The Canadian Press
Barrick Gold Corp. is further reorganizing its operations, moving two dozen tech jobs to Nevada and getting ready to lay off more staff, according to people familiar with the matter.
The miner, the world's largest gold producer, has already axed 100 employees at its corporate head office in Toronto since bullion prices started to drop in 2012.
The latest round of job losses will come as Barrick follows through on a plan to trim expenses and make its regions more accountable.
The layoffs were expected to be announced this week, sources said. A company spokesman declined comment except to say:
"We will provide an update on cost-cutting initiatives in our year end results."
Today, Barrick's head office is a fraction of the size it used to be during the gold heyday. About 250 are employed in Toronto. Its management team has been overhauled since John Thornton became chair last April and the group in charge of looking for new mines has been dismantled.
Barrick is also in the process of moving IT jobs to Nevada and recently opened an office in Las Vegas. The desert state is home to some of the company's most profitable mines. Those jobs will likely be filled by Nevadans.
The move increases Barrick's presence in Nevada, while reducing head count in Canada. Barrick's founder Peter Munk's vision was to establish a large miner in Canada, where so many of the big miners have been taken over by foreigners.
It is unlikely the job cuts will make a significant dent in Barrick's $13-billion (U.S.) debt load.
Cost overruns at a key project in the Andes and an ill-timed takeover of a copper company at the height of the commodity boom has left Barrick with too much debt.
Barrick has told investors the company plans to trim its net debt by $3-billion. The company is considering a range of options.
The miner already raised $3-billion in a share offering two years ago and its co-president said another equity raise is not on the table.
Although no major debt is due until 2017, analysts are taking note. Royal Bank of Canada recently downgraded Barrick to "sector perform" from "outperform," citing "uncertainty with debt and capital allocation."
With gold down 30 per cent since the euphoric days of 2011, Barrick and the rest of the gold industry have undertaken severe cost-saving measures, including dividend cuts, asset sales and project suspensions.
Iamgold Corp. recently laid off executives and got rid of its team responsible for building mines. Kinross Gold Corp. is also considering job cuts, according to sources. A Kinross spokeswoman said:
"We have no announcements planned."
Rachelle Younglai