Barrick Gold Corp. fell short of analysts’ estimates for third-quarter gold production on Thursday, as lower output at its North Mara mine in Tanzania offset gains from its Randgold buy and the Nevada Gold Mines joint venture.
Operations at the Canadian company’s North Mara mine were hit by tax and environmental disputes, and restrictions were lifted in September after Barrick addressed concerns about seepage at the project’s tailings storage facility.
North Mara was operated by Acacia Mining and Barrick took full control of the miner after a British court approved its US$1.2-billion takeover.
Barrick gained from its Nevada Gold Mines joint venture with Newmont Goldcorp Corp. that the company estimated to have produced 535,000 ounces of gold in the third quarter.
The venture was set up after Barrick abandoned its US$18-billion hostile bid for Newmont and the miners then agreed to combine their assets in the U.S. state.
Also boosting production was improved output at the Loulo-Gounkoto mine in Mali, which Barrick acquired through the purchase of Africa-focused Rangold Resources.
The bid for Newmont and the purchase of Rangold marked Barrick’s efforts to boost shrinking reserves, and cash in on rising prices for the precious metal.
Gold prices have gained 16 per cent so far this year, as investors sought relief in safe-haven assets amid a prolonged U.S.-China trade war.
Barrick beat Street estimates for copper output, driven by higher production at the Lumwana mine in Zambia. The company is considering selling the asset as the country’s proposed new mining taxes would make it challenging to generate adequate returns.
Gold production totalled 1.31 million ounces, lower than the second quarter’s 1.35 million ounces, while copper output rose 14.4 per cent to £111-million, the company said.
Analysts on average estimated gold production of 1.35 million ounces, and copper output of £105-million ($187.63-million) , according to Refinitiv IBES data.
Barrick said third-quarter gold cost of sales per ounce is expected to be about 11 per cent to 13 per cent higher than the second quarter, primarily due to higher depreciation resulting from purchase price adjustments at Nevada Gold Mines.