Global Wrap: Barrick, Antofagasta and more

IN Global Wrap: Barrick reports results; arbitration wins for Barrick-Antofagasta JV and Cameco; new platinum JV; and Codelco CEO appointed.
Global Wrap: Barrick, Antofagasta and more Global Wrap: Barrick, Antofagasta and more Global Wrap: Barrick, Antofagasta and more Global Wrap: Barrick, Antofagasta and more Global Wrap: Barrick, Antofagasta and more

Barrick Gold says it remains on track to meet its 2019 guidance after reporting its June quarter results.

The company produced 1.35 million ounces of gold and 97 million pounds of copper, driven by strong performances from Loulo-Gounkoto in Mali and Veladero in Argentina, where production increased 14.8% and 7%, respectively.

However, this was slightly down from the 1.36Moz and 106Mlb produced in the March quarter due to lower production at Barrick Nevada (-8%) and production interruptions at Pueblo Viejo (-16.2%) in Dominican Republic. The fall in copper output was due to lower production at Lumwana in Zambia (-19.7%).

Barrick concluded a transaction to establish Nevada Gold Mines, a joint venture with Newmont Goldcorp in which it owns 61.5% and is the operator, at the start of July and expects this to positively impact its production outlook for the year.

Nevada Gold Mines assets comprise 10 underground and 12 open pit mines, two autoclave facilities, two roasting facilities, four oxide mills, a flotation plant and five heap leach facilities. Nevada Gold has proven and probable reserves of 48.3Moz; measured and indicated resources of 27.4Moz and 7.5Moz of inferred resources.

In 2018, these assets produced 4.1Moz and Nevada Gold Mines is targeting production of between 1.8 and 1.9Moz in the second semester of 2019.

The World Bank's International Centre for Settlement of Investment Disputes has awarded US$5.84 billion in damages to Tethyan Copper Company (TCC), jointly owned by Barrick and Antofagasta, in relation to the arbitration claims filed against Pakistan following the unlawful denial of a mining lease for the massive Reko Diq project in Pakistan in 2011.

Damages include compensation of $4.087 billion by reference to the fair market value of the Reko Diq project at the time of the mining lease denial, and interest until the date of the award of $1.753 billion. The tribunal also awarded TCC just under $62 million in costs incurred in enforcing its rights.

"We are pleased to reach this milestone after more than seven years of arbitration," Antofagasta CEO Iván Arriagada said.

The award is binding and there are limited grounds to challenge it.

Barrick and Antofagasta said they remained open to negotiating with Pakistan.

TCC previously completed a feasibility study showing that Reko Diq was one of the world's largest undeveloped copper and gold deposits, and had a potential mine life of over 50 years and an estimated initial capital investment of over $3 billion.

A tribunal of international arbitrators has ruled in favour of Cameco in a contract dispute with Tokyo Electric Power Company Holdings (TEPCO).

The tribunal rejected TEPCO's assertion that it had the right to terminate its uranium supply agreement alleging force majeure, and awarded damages to Cameco of US$40.3 million, based on the tribunal's interpretation of losses under this supply agreement.

Cameco had been seeking $700 million.

"We are pleased that the Tribunal agreed that TEPCO was not entitled to terminate the supply agreement, but we are disappointed with the amount of damages awarded," Cameco President and CEO Tim Gitzel.

"However, remember we had already removed this contract from our financial outlook. So, overall the result is positive for us."

Vancouver-based Platinum Group Metals reports that Anglo American Platinum have launched a new venture, Lion Battery Technologies, to accelerate the development of next-generation battery technology using platinum and palladium. The possibility of creating additional demand for platinum and palladium in the battery technology space is an exciting development and of strategic importance to both parties.

The new venture, Lion, has entered into an agreement with Florida International University to further advance a research program using platinum and palladium to unlock the potential of lithium air and lithium sulphur battery chemistries to increase their discharge capacities and cyclability.

"This exciting early-stage technology aligns with our broader strategy to bring new technologies to market that will help us secure future demand for the platinum group metals we mine and pave the way to a more sustainable energy future," Anglo Platinum executive head of market development Benny Oeyen said.

Copper industry veteran Nelson Pizarro will step down as head of Codelco, the world's biggest copper producer, at the end of August and will be replaced by Octavio Araneda, currently VP of operations Central South of the state company.

Araneda is a mining civil engineer from the Universidad de Chile, has a MSc from Curtin University in Australia and a MSc in metallurgy from Universidad de Chile. He has spent almost all of his professional career within Codelco, mainly in the El Teniente division where he became general manager in 2010 before rising to become VP of operations Central South.