Reuters Business
Barrick to sell half gold output this yr at US$365
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MELBOURNE, April 15 (Reuters) - Barrick Gold Corp (Toronto:ABX.TO - news) said on Monday it will sell half its gold output this year at a minimum price of US$365 dollars an ounce, with the balance to be sold on the spot market.
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``That extra gold exposure to gold prices means that for every 25 dollar increase in the gold price we will see earnings and cashflow increase by 70 million this year alone,'' Randall Oliphant, chief executive office of Barrick said in a speech to be delivered later on Monday in Melbourne.
For 2002 Oliphant said Barrick will mine about 5.7 million ounces at an average cash cost of US$167 dollars an ounce. Oliphant said gold miners worldwide needed to increase marketing efforts to support any long term increase in the bullion price.
``Our industry can no longer ignore the role of modern marketing in driving consumer demand than it can act in isolation from the forces of consolidation,'' Oliphant said.
Over the last year or two some of the world's largest mining companies have merged in a bid to increase their mine reserves of gold.
In February, U.S.-based Newmont Mining Corp (NYSE:NEM - news) compleated a A$4.2 billion dollar ($2.24 billion) takeover of Normandy mining which was Australia's largest gold miner.
Barrick last year merged with Homestake Mining to become one of the world's largest gold mining companies with a market capitalisation of around US$10 billion.
About 55 percent of its production comes from mines in the United States and Canada. Barrick, like some other gold miners, sells a portion of its output at pre-fixed prices, a practice know as gold hedging.
The bullion price, which averaged around US$273 an ounce last year was last bid at US$300.80 an ounce, underpinned by the latest tension in the middle east and the higher oil price.
Barrick shares closed at 28.18 Canadian dollars on Friday. |
