Q4 2022 Barrick Gold Corp Earnings Call
Ladies and gentlemen, thank you for standing by this is the event operator.
Welcome to <unk> results presentation for the fourth quarter and full year of 2022.
Following today's presentation, a question and answer session will be conducted.
If you have a question on her joining the event by telephone. Please press Star then one on your telephone keypad.
It will also be taking questions from those in the room.
As a reminder, this event is being recorded and a replay will be available on barrick's website. Later today February 15th 2023.
I would now like to turn you over to Mark Bristow, President and CEO with Barrick.
Please go ahead Sir.
Thank you very much Mad men.
In a very good morning, and good afternoon, ladies and gentlemen for those you on drawn done elsewhere across the globe.
As you know we are going to be talking about a quota for them.
2022 results today.
And looking back the past year it didn't.
Turned out the way anyone expected I'm sure you'll agree with me.
But against a background of.
So the geopolitical deterioration there was some fundamental changes in our global financial landscape, which Herald heralded the I believe the end.
The easy money era.
And the new regime of high interest rates high inflation and high risk.
On the positive side, and then responds to those gold was one of the better performing asset classes.
It's also good to see the copper price pick up.
Well gold has always been the world's most precious metal copper has I believe become it's most strategic.
Eric I didn't say it.
Industries.
Sterne Best Gold portfolio.
We are the largest producer in the United States and Africa.
And we are steadily increasing a couple of holdings.
And as I plan to share with you today, our proven long term strategy drives our ability to create and deliver value even in difficult times.
I draw your attention to the full more cautionary statement, which can be reviewed in full on our website.
And 2018.
And Jordan Thornton and I agreed on the marriage of Barrick and Randgold.
We spent a lot of time designing this strategy, we would use to create a new industry leader.
We wanted a company that would stand out from the crowd driven by a fundamental promise to all stakeholders that we would do what we said we would do.
And we have done exactly that.
Since then we have produced around 19 million ounces of gold and 1.7 billion pounds of copper.
Old reserves have increased to 76 million ounces.
We have returned $4 billion to shareholders.
At the same time invested seven and a half billion dollars into a rolling 10 year business plans.
And significantly Delever leveraged.
The company.
Justin 2022 a copper resource has increased by more than 124% you'd rather yeah.
And we've set the stage for a growing exposure.
To this critical future facing metal.
On the portfolio optimization front, we have achieved a $500 million of annual synergies at the Nevada Gold mines joint venture.
And Ive transform the legacy Acacia assets in Tanzania.
Which now produced gold at a level that meets tier one production status as a combined complex.
And finally, moodys upgraded our long term credit rating to eight three from B double a one the highest credit rating in the gold mining industry with a stable outlook.
Highlights of our busy was the significant increase in there.
Our gold reserves and resources.
As I've said before our ability over time to more than replace the answer as we mine is one of the attributes that sets us apart from our peers.
As it reinforces our sustainability and drives the growth of <unk>.
I'll turn your production profile.
In line with our strategy of increasing our exposure to copper we've also more than doubled our copper resource base over the past year.
[laughter]. According accordingly, we have started work on the reconstituted Rick Burdick project in Pakistan, one of the world's largest and highest quality undeveloped copper gold deposits.
Added to this Pablo VAALCO gold mine in the Dominican Republic added approximately 11 million ounces of reserves and started with the commissioning of its plant expansion project.
In Nevada.
Gold Rush advance to the next stage of its permitting process and turquoise ridge commissioned its third shaft.
And on the organic growth front bad brownfields exploration continued to unlock potential around our existing assets.
All Greenfields work started to deliver some real future value.
The standout was a very significant intersection at the Dorothy target at all Barrick's full mile project, which I'll tell you more about later.
Despite our strong fourth quarter and the usual solid contribution from the Africa and Middle East region Gold production ended around 1% below guidance, mainly due to the need to fix some of the infrastructure at turquoise ridge and lower.
That's a protest from Cortez.
Copper production was well within guidance.
Similar input prices expected in 'twenty to 'twenty, three and a slightly better production profile cost per ounce auspex expected to be at or slightly below our 2022 levels.
As I pointed out Barrick, but it's one of the strongest balance sheets in the industry.
Even after the return although another record $1.6 billion to shareholders in 2022 through dividends and share buybacks.
At Barrick, we believe that in mining the greatest value creation opportunity cottons from discovery and development.
Preferred strategy is to find out ounces and if we buy there should be a real future potential to add to what we have been by.
Thanks to the continuing success of our exploration programs, we've a great again growing our gold reserves.
Bob the annual depletion delivering 6.7 million ounces of reserve growth year on year.
At the same time attributable gold resources increased by 10% and as I noted earlier copper resources more than doubled.
Despite the continuing improvement in the leading and lagging indicators Barrick safety record has been badly blemished by tragic fatalities in 2022 and then you had to date.
All of these have been thoroughly investigated and the lessons we learned all being applied throughout the group.
Significantly most of these fatalities, which suffered by our contract is showing that our oversight of their safety systems and protocols needs to be tightened up.
Which we have prioritized as part about Onboarding and ongoing interaction with our business partners.
Sustainability, ladies and gentlemen is fundamental to barrick's business.
We believe that solid risks.
The T and biodiversity loss are inextricably linked and should be managed holistically.
This approach is based on our commitment to supporting the social and economic development.
Our host countries and communities.
Last year, we invested more than $75 million in community projects.
Decreased greenhouse gas emissions by around 2% in line with our plan continue to expand our green energy sources.
And achieved our water use efficiency right.
Well above that target.
80%.
Delivering.
For Barrick.
Sustainability starts at the mine planning stage and begins well before the mine is constructed.
In that regard we plan to show her mining can be at the forefront.
The achievement of the UN sustainable development goals.
This massive project is expected to have a transformative impact on the impoverished chugai region.
In Balochi Stan.
Pakistan.
Creating thousands of jobs and stimulating the garage so the local economy as we have done and the other projects across the developing world.
Well first production is targeted for 'twenty 'twenty eight.
We've scheduled the disbursement of social development funds.
Advanced royalties to the bullets, you Stan province, well in advance of first production ensuring that as people will get an early return on their share of this new partnership.
We've also started employing a local workforce and recently appointed but lets you started national as our country manager.
Moving on to operational review, we'll start in North America as usual with a relatively new leaderships for the region and Nevada gold mines, all focusing on teamwork and effectiveness.
With particular emphasis on agility integration and rapid response to operational variations.
As I noted earlier.
Collyn Cortez.
And turquoise ridge were impacted some by some unforeseen production issues.
But staged a strong come back in the fourth quarter.
The commissioning of Turquoise Ridge third shaft is expected to deliver continued improved performance.
The underground operation ramps up.
Okay.
Nevada is barrick's value Foundation.
And the benefits of combining the assets and the.
N G M are now becoming evident in the form of mineral resource growth and new discoveries supporting future.
Reserve conversion and adding to our rolling 10 year plan.
Some of which are shown on this map.
The quality and prospective any of this complex cannot be understated and we are excited about the recent success we have achieved.
At full mile Robinson and call it.
Robinson, a maiden reserve at 1.6 million ounces was declared with further expansion potential between existing deposits and a long strike.
Within Collyn, we grew last year's inaugural resource to 1 million ounces at north level, while north tariff continues to expand towards north level and Horsham as the new project is showing significant growth potential east of the levo fault.
It ran drilling has added to the resource base and an increased understanding of the controls on mineralization.
As I've already touched on Dorothy is that particularly exciting target some hundred meters north of the four mile resource.
Drill holes have returned some impressive intersections pointing to a new discovery.
Significantly and significantly increasing the potential of four mall as well as identifying further untested extensions to the mineralized trend that makes up the gold rush and formal resource and reserves to date. These.
These represent results represent some of the best intersections ever returned from the former gold rush trained.
And drilling on the outside cause unexpected the zone of high grade mineralization.
I haven't seen drilling steps like this before.
In my career.
And they all what every exploration geologist lives fall.
As a reminder.
When we formed Nevada joint venture with Newmont in 2019, the companies agreed that a number of assets would be retained by each company to be vented into the joint venture at a later date.
So on that point.
<unk> is 100% Barrick owned asset and when you look at the resource potential at the moment it looks like around 15 million ounces and gold rush and about full and and so certainly these intersections bring us and we've combined the two with the potential to go well over 20 million ounces.
And that's the sort end and when you look at the size of these deposits are relatively small in some of your old appreciate in volume, but very big as far as ounces got and so we're super excited about this a recent development.
Okay.
The exploration team in the North American region.
Has driven some significant changes and exploration strategy in the last two years with a strong mandate as we shared with you at our Investor day to expand beyond.
Nevada, and evaluate cropping up copper opportunities as well.
We restarted barrick's exploration in Canada building, a new team and portfolio, which has been a real success without first option agreement, yeah, hemlo being signed in the last quarter.
In the U S. In addition to the exciting brownfields targets I'll talk about next the team has secured three further option agreements buzz in the Great Basin area in Arizona and also in the Walker Lane mineral district in Western Nevada, which already returning.
Early results.
A dedicated new business team is actively evaluating all opportunities across the continent as always with a clear focus on our strategic filters.
Moving itself.
To Latin America, where full year production was within guidance despite recovery issues at Valent era.
I blow Vaca ended the year with a record throughput.
Major achievement, considering the plant downtime required for the expansion tie ins.
And the expansion project will extend the mines T O one states as far into the future.
Construction continues to advance and commissioning of the plant is currently underway.
Meanwhile, permitting of the new tailing storage facility is expected to be completed around mid year.
The existing facility can handle tilings until the end of 'twenty 'twenty seven by which time, we expect to have the new facility commissioned.
Hello, there are which as you'll recall is high up in the Andes was impacted by an extended winter and low Leach recovery, which we are still wrestling with but significantly improved production in the latter part of the year.
The long awaited cross border link to the Chilean power grid.
Was switched on in December .
That will reduce the mine's energy costs as well as its carbon emissions.
Dara continues to suffer the effects of Argentina's enduring currency crisis.
Reflected in higher labor and local contractor costs and.
And we remain engaged with both the federal government and the provincial government to try and find solutions.
Our exploration team on the other hand has been developing our Latin American portfolio in line with our drive to expand our presence in this region.
And we continue to progress our collection of early stage projects.
Specifically in the Vela Darrow district.
Logical work is focused on targets with the potential to add to the Vela there are mines life.
We have a portfolio of untested targets close to the mine with some exciting results being returned from Nomura.
Indeed, a target specifically where drilling has confirmed and is extending a zone of strong mineralization near surface.
We've also been looking closely at the prospective El Indio belt, which hosts fellow Debra and other bonds, having completed a large data compilation and reinterpretation exercise. We're now looking to evaluate the significant remaining target areas over the next.
Three years.
Moving across the World to Asia Pacific.
Progress continues its progress towards restart.
The new ownership structure.
We expect Paul Paul Gras to reopen in 2020 three but the assay. It remains excluded from our guidance until such time as we have finalized all the agreements and outstanding matters.
In Pakistan, we have started the environmental and social baseline studies for Ricky <expletive> and our inventory and our introductory engagements with the local communities I have been personally leading.
Rick Burdick is a fantastic example of the tremendous value that can be created by developing what is essentially a thousand deposit rather than paying large acquisition costs and then having to fund future development obligations.
It is more common in today's mining industry.
The Africa and Middle East region delivered its usual solid performance with both gold and copper production well within guidance.
It's energetic new management team has been mitigating the impact of inflationary pressures.
Including through the ongoing solar expansion and battery installation projects at Lula and Kibali.
The new logo contract complex in Mali continues to improve production and lower per ounce cost.
It's expanded solar power and battery plant will replace 23 million liters of heavy fuel and reduce greenhouse gas emissions by a further 62000 tons. When it is fully commissioned.
The Lula district is still one of our happiest hunting grounds.
Across the river in the budget permit.
In Senegal.
We've defined the 26 kilometer long highly prospective trend.
We call it the bomb Budgie main shear zone and identified nine key targets, along which we will be drilling to test for tier one scale systems.
This is in line with our strategy of testing the major structures on the Mali side of the district, which is delivered so much success.
Moving now to the Democratic Republic of Congo, Kibali is processing capacity was impacted by a rock winder change yacht.
But that is now behind us.
As already mentioned the planned solar power and battery storage system will provide renewable backup during the dry season.
Kibali is K Z zone continues to reveal exciting potential and multiple targets all being progressed.
We're about to start testing the western side of the K C D deposit.
Which couldn't host additional high grade mineralization shoots.
While it's still very target showing on the long section.
Confirms the potential of the trend was high grade mineralization being intersected.
Tanzania as I pointed out in my introduction is also a standout example of what Barrick is capable of achieving.
Under three and a half years, we've completely rebuilt the two derelict mines, we took over from the previous operators.
To a point where their combined production is that a tier one level.
We've also resolved some of barrick's, most challenging legacy issues and regained our social license and a pioneering partnership with the government you can see the results about if it's yeah.
We've got big plans for both mines as mining is scheduled to commence at the new General open pit later in quarter, one and we'll leverage the investments made from our transition to owner mining.
While the new underground fleet at Polyone, Hulu continues to deliver on our ramp up plans.
Turning now to our copper portfolio.
Lamar in Oman in Zambia, as another asset we've successfully revitalized and forms a key part of our growth plans.
Last year's production was at the upper half of the guidance range and our ongoing transition to owner mining, including the investment in a brand new fleet has position Lamar I know well for potential expansion and see significant mine life extensions.
The team is busy with the pre feasibility study, which is expected to bring the development of a new super pet into our business plan by the end of 'twenty 'twenty four.
Cobalt sayiid in Saudi Arabia, also delivered production and cost metrics that were within or better than guidance together with reserve growth above depletion, adding another year to the mine life.
Zelda law in Chile produced a consistent poor.
Performance.
In Saudi Arabia, we're expanding our exploration presence and partnership with modern with two new Greenfields projects.
Turbo Sayiid, South and Oh my demand projects.
Also at your bauxite mine itself strong results from deep drilling at load one are on track to support another year of reserve growth while exploration results continue to confirm the further discovery potential within the mining lease.
Demonstrating our commitment to strong shareholder returns.
<unk> 22 payout was as I pointed out in my introduction.
A record $1.6 billion and included $424 million in share buybacks.
We have introduced a new share buyback program.
$2 billion for the next 12 months.
Our returns to shareholders.
Have not been at the expense, although organic growth as can be seen from this profile.
We continue to invest in and role of are all 10 year gold and copper plants, which demonstrates real organic growth. In addition to a consistent base case production profile.
Since the merger with Randgold.
Barrick has consistently outperformed its peers in operational delivery and capital discipline.
In line with our clear strategy.
Delivery of our plans on the back of the quality of our portfolio means we are in the privileged position of being able to generate significant free cash flow into the future.
This ensures we can continue to invest in our future and provide returns to our shareholders.
Embedded in our existing portfolio is an unmatched pipeline of quality projects in which we are steadily unlocking value as we have done from the existing operating assets there.
The ability to grow without having to buy is a significant differentiator and I believe that in time this embedded value in our portfolio will be recognized.
Putting it all together.
Presents a powerful case for investment in Barrick.
There is no other mining company that has a proven long term strategy.
Our quality assets.
Our growth projects.
Oh, well clauss team.
And our social license to operate.
And through a mutually beneficial partnerships with our host countries.
Our existing copper portfolio as a differentiator.
Both in terms of the significant contribution it is already making.
And the ability to grow it further.
With bank long term plans firmly in place and a world class team, we have the ability to ensure we will be sustainable into the future. Thank.
Thank you, ladies and gentlemen for your attention and we will we have as a team out and Toronto and we will be happy to take any questions.
Thank you we will now begin the telephone question answer session.
To join the question queue via the phone you May Press Star then one on your telephone keypad.
Hear a tone acknowledging your request.
If you were using a speakerphone please pick up your handset before pressing any keys.
To withdraw your question. Please press star two.
We will pause for a moment as callers join the queue.
Yeah.
The first question comes from John Tumazos, a private Investor. Please go ahead.
Okay.
Thank you very much for all the great work.
Looking ahead to a year from now.
Which technical studies.
Do you anticipate getting done in 'twenty, two 'twenty three to permit large additions to reserves and resources comparable to the <unk> Com Wanna.
Oh additions at year end 2022, as those multiyear program has borne fruit.
So.
Thank you for that.
I think the big focus for new garage is Nevada itself.
You know that that is more lumpy because we.
We define sort of expansion.
Resource inventory initially than we drill it out to them.
Third.
He source, but really we only bank it.
When we get on the ground in drilling from underground and we've got a lot of development going on particularly in the northern level area Horsham as I pointed out the rain project has now got a development drive going and we're excited about that we think that's got potential to more than double its current mine.
Bold resource and converted all to reserves.
The Robinson project itself has a lot of upside we've just started drilling that out now and and again, we are drilling some of the gap areas like the fence line in between the old twin creeks and turquoise Ridge, we bought some interesting work coming on.
The BV T Colorado.
I as an interest we call it B B T because it stands for better be there and.
And we've confirmed that it is today, so we're not developing towards towards that target. So southern Nevada for US is really exciting we've got some new exploration targets, which will be sharing with you in due course across the Americas are the northern Americas.
And and we've opened up new exploration projects.
Projects in Dominican Republic, I'm sure the work that we're doing in.
Around better there, which is important to ensure that we extend that life of mine.
And then in Africa.
Got it.
Significant opportunity that's that we now focused in on and the joint venture with modern on the well not Tomorrow project, which is a very real copper our targets, it's got mineralization on the surface.
And and and again, we think that we can re couldn't well. We believe we get we are we can model the b M at surface.
Geological service that connects these targets together to the jumbo side deposits, which are high grade.
Copper deposits.
Our team has now started consolidating ground in Tanzania, and and again, Tanzania is and as you know has been largely.
Neglected by the industry for more than a decade and in it and so we're excited about that we also have a big team focused in on.
Central African copper belt as well as the eastern the whole eastern part from.
From Kibali down into the Victoria Goldfields. So if you look at that and that's a product of us investing over the last four years and in really lifting the game and quality of our exploration teams and I, absolutely believe that we day to day and so.
In Africa, because of the history of our work that we can show you how we got to replace the reserves into this year, but we know we're not going to replace all the reserves every year, but over time.
If you look back to 'twenty, a teen in the merger.
We produced eight nine.
19 million.
Ounces of gold and we replaced it all plus.
So and that's the difference that's why you know this industry I've been repeatedly saying doesn't invest in its future and that it it has to.
Go to walk to the last resort of buy assets at whatever it can get in the market and in my career I've spent my entire career boulding, our organic opportunities, which is the only real way you make.
You make you create value and that doesn't mean to say we were not.
Shy of doing M&A and and if you go back to the history of both Barrick and Randgold.
Very built its business on M&A, but more importantly on the work after the acquisition and adding significant value through the drill bit and so did randgold. So these two companies no. One has a good memory on how to do this properly and.
And I think we did you know you can you can you can say whatever you lock, but the fact is we've done it we said we would do it we've done it and we've now got a foundation on which to continue to deliver that value and that's really the difference.
And we will we'll still look at opportunities when they arrive, but we don't have to.
So an opportunity just because we haven't been able to replace the gold reload.
And the next question comes from Martin <unk> with Veritas investment research.
Please go ahead. Thank you.
Thanks for the opportunity.
I wonder and the cost of sales in Q <unk>.
Q4 was 1324.
Eight 8% versus 1012 or 26 in Q3.
And then wonder why do why it was given that you had bigger volumes, which usually.
To imply lower cost.
Yes.
Oh, that's been our policy to to grab Martin It's Graham Shuttleworth here.
Martin the key driver there really was depreciation.
And so there's two aspects to that one is when you when you.
Have increased volumes then you generally tend to have increased depreciation because it's it's linked to the.
Production and then also when we do our annual tie in is really for the purposes of that in the final financial audits. We we do some adjustments that reflect the full year accounts and so some of that comes through.
Additional depreciation in the fourth quarter.
Okay. Thank you.
Yeah.
Once again, if you have a question from the phone line. Please press Star then one.
The next question comes from Tanya you could connect with Scotiabank.
Please go ahead.
Good morning, everyone can you hear me.
Hello and.
Thank you. Thank you for taking my questions I have three if I could the first one has to do with Parker and I know I asked about partner all the time I'm just Mike can you give us an update on where we are with Parker I know on our last conference call and in Investor Day, We talked at our top out a potential start up maybe as early as <unk>.
At the end of Q1, we're not too far off from there. So I just wanted to ask if we've seen slippage or how should we be thinking about program. This year.
I know, it's not in your guidance I'm just talking about the.
Right.
They're getting it done and the other two.
Oh, sorry, My second one is to do with health and safety I just wanted to understand what exactly is happening because that's quite a number of fatalities in a very short period of time.
And I'm just trying to understand like what changes have you implement kicked in like what have you seen and what have you learned pet to move forward on this and then my last one is sad to do with the copper side do you think Mike you have enough copper annual portfolio from what you have in your current portfolio and.
For our corporate growth or do you see other opportunities on the M&A front in copper.
It wasn't like the guys are Daniel Thanks for that I'll start with the it was the last question. So we do not have enough copper.
We've certainly got visibility of where we want to go and again.
It's it's it's fundamentally driven by our exploration investment and and again, while everyone else has been talking about it we've actually got in to the field and we've.
Focus and as we shared with you in our investment day, certainly within the United States. You know that's a significant didn't documents, particularly in Arizona and and then and then also.
South America, and they're along the Andes and particularly the historical legacy permits of Barrick and and a big focus in on a central Africa.
About and as you know, we all we are well entrenched in Zambia, and we have a very strong long term relationship with the DRC government and and and again that we believe puts us in a very strong position and we organically led so and that's what we can offer it to two.
Government is long term value creation, not a sudden arrival with the short term promise and in those countries all of wanting to see that you know what.
Its copper cobalt or any other E V. We've gone to a gazillion people arriving in these prospective areas around the world they not miners they have a yeah lots.
Lots to say, but very little expertise in how you how they can bring their their claims to to fruition in the form of value for their host country. So so copper is very much as we said in 'twenty 18, when they put the two companies together and integral part of <unk>.
Our strategy and by the way.
That doesn't detract from our ongoing commitment to continue to to grow.
All our golf portfolio.
And and and again, if you look at the edge. If you look at the size of all our businesses. So Nevada speaks for itself Kibali, So six tier one assets.
500000 ounces and more significantly more in most cases.
Beyond 10 years, then you look at Tanzania, that's two mines, producing 500000 ounces so that takes it to seven.
And then we've got.
The opportunity with Rick Burdick, It's a tail one cup asset that takes it to eight and then we've got Lamar now that we're looking at and that has real potential to be as big as far as production goes as our share of rig codec that takes it to not.
And so you see and then Paul Gras, which I'll come back to.
That takes it to 10, because it's a plus 800000 ounce producer so.
So then what our focus is is and those sort of chunky assets into our portfolio.
And as you know Tanya.
They're not mainly around to go and buy so you know it leaves us the challenge to be able to handle.
How did those down and then and that's really our focus.
Hmm.
Very good question and as you can imagine I mean this for me personally it's been a traumatic Tom.
You know.
It's it's multiple.
Multiples more than.
And Oh, the fatalities Avi experienced in my 35 year career.
And so as a team as an executive as a management team across the group, we've really had a lot of introspection looked at these issues. We spent an hour with our board yesterday working through what we've discovered and you know the the the challenge is that all.
Lagging indicators have come down materially as I showed.
And and and but it is we've had this sudden pickup in fatalities are largely without contracting partners.
And the point is my commentary is that.
You know, what what where I come from and what we've introduced and this group has a very flat structure as you know we embrace local local so we embraced the local.
And as in building capacity to invest.
Growth projects into the host country economy.
And and at the same time.
In Africa as you know we've changed the management team considerably in Africa, and I believe that.
One of the <unk>.
Drivers of this is the fact that we we didn't invest enough time and getting to know our contractors, which was a traditional thing when you're flat you don't have that big corporate sort of.
Wait.
And so it's all about interaction on a personal basis and particularly when you bring in.
Contra.
Contractors that are not international in in in size and capacity, we've got to ensure that we instill that are in them and and and again as we've changed and continue to change that culture across the Americas, both south and North we see that we've got to invest.
More and we've got a specifically look at al and induction of a contract is making sure that they have the systems are that we expect to have and and to spend more time engaged with them to ensure that they lift the game to the level that we expect anybody to two.
Have when they when they operate in our operations and I think that apart from you know just making sure. This is a very significant.
If it across the group I've spent a lot of time personally our whole executive.
Spend time, we've really reinforced the responsibility of everyone to stop unsafe work and and.
And again, we've moved it from being you know the rog two the responsibility and and and I'm pleased to say we've had some significant examples of our people exercising that responsibility just in the recent weeks and and.
And this is you know like this it's a it's a tough thing because it's it's not very tangible.
And another person who likes to have absolute control of things. So it's been a big Big Challenge for me personally and and and the team has stepped up and and and we you know. This is this is more important to us than anything else and and where I've I've got no doubt that we are as a team are absolutely committed to making sure.
That we get on top of this challenge.
Then Paul Gras.
One thing about operating in Papua New Guinea is if you get your agreements rot than you can operate freely until they come up for renewal or renegotiation and so that's out intention it's.
It's a challenging environment to work in.
Extremely challenging probably the most challenging environment Ive worked in and I as you know have worked and quite a few of those.
We have not incorporated a company that.
We will be the vehicle that has the new ownership and will eventually end up with the special mining license.
The steps you've got to go through to get there is we've got to Ah transfer the exploration license from B N. L M, which is the barrick vehicle into the new vehicle and once we've done that we can apply for the.
Special mining license.
And as part of that process, we start the consultation with our communities we have agreements with the various.
Landowner representatives, but we've still got to go and then huh.
Consult under the auspices of the.
The MRI the the government binding authority.
And but we all we are moving in that direction, we are employing people.
We we have.
Reviewed and as part of a care and maintenance responsibilities.
Sure that that we've inspected and and.
And maybe and ensure that our mobile fleet is operational we are beefing up the spare parts. We have we are doing some maintenance are we going to replace some of the tanks and the processing.
The infrastructure and so we are moving it's not gonna be a.
Sort of.
Hey.
I I did start it's a it's gonna be a running start as we get there and and and again our team is now.
Progressing these agreements are with the government and the other authorities the state mining company, which is a major partner.
<unk> has just had a big management change for the good job ought to add and so that's helped a lot in getting moving on a with a with getting these agreements on so.
It's where.
It's gotta be this year I believe.
Exactly when.
I think one thing I can tell you is the prime minister and myself are equally motivated to get this modest started so.
But as far as we're concerned we're not prepared to take any shortcuts.
And we will get there.
Oh, Okay. Thank you I'll leave it to someone else to ask questions. Thank you Tanya.
As there are no more questions from the phone lines at this time. This concludes the telephone question answer session.
So we gotta go to the room now ma'am.
Okay Fantastic Mark Thanks for the presentation two questions. So first one on the buyback you commented earlier I saw a press headlines that you I believe barrick is undervalued to peers.
Certainly is trading at a discount that was also the case a year ago, though and you had $1 billion buyback and only used $424 million of it well you'd be more active on it in 2023 so low Senate.
It is a balance so it's about allocation of capital you know one of the things I'd I'd go back in 2020. One you remember we had a short run on our stock and we had no ability to stop it and that's what motivated us to file for the authority.
Did you do buybacks and and and so.
Last year, we we have a graham and I and and Graham's team we analyze.
The the richest out in the trade and the times when we believe it's fundamentally undervalued, we will bother shares and we had a program to do it and if you look at how we bought it how we bought the shares last year, we did very well we started at the right time, we stopped at the right Tom.
And we were able to tighten up the market a little but during those weak periods.
We the reason we are requested authority again is that again, we just don't want to be caught without in a way to stop or a negative run on our stock and we believe when you look at it. Unlike some other companies who bought tie and didn't bother.
We did it.
And so it's a it's we see it as a tool to manage the.
Fundamental value of our own those assets and so that's the way we do it I know, it's not absolutely specific but I can tell you that we spend a lot of time worrying about why are we buying it and under what circumstance and then we also balance that against all.
One long term capital allocation strategy, so last year.
As you saw.
That buyback impacted the dividend because we used up cash on the balance sheet, but at the same time, we still delivered value back to shareholders. So that's if that makes sense because you want to add anything to that I'll just reiterate the point that it's all about a balanced approach to using our capital and as you saw one of the.
Communities, we took advantage of in the fourth quarter was to buy back some of our debt very favorably.
And at a discount to par, which is saving us interest charges going forward. So it's all about balance and and then at the end of it all with.
We're very focused on having a strong balance sheet, because we think through the cycle. That's a differentiator for them and so again that's reflected in our current rates. So it's a balance and fundamentally Lawson.
We're business people, where owners we treat this company as a business and so you know we run it as a business we run the balance sheet properly. We will look at the whole list at two grams point, the whole business profile and manage it accordingly, and we will continue to do that.
Okay. That's fantastic. Thank you both and then I wanted to ask about one of your favorite countries, Argentina and Villa Darrow, maybe if you could just speak a bit to the.
Recovery issues are occurring at Villa Darrow and just what the plan is at this point to address those and then.
Further comments on the Capex being deferred from this year into next year do you have a number of how much that deferral was.
I'm sorry.
So what we've done first of all that's just.
As you see there's a softer outlook for this year so as far as production goes we've been conservative in the way. We've teaches US. The reason is that we've intersected you know we didn't get the drill rigs.
Go ahead of us during Covid was a real bad bad delay we did cover some of it and we manage that mine on.
On both bottle roles and.
And column Leach test because the bundle role doesn't always give you the right recovery and there was a historical periods.
I'll cover away, we just had bottles. So we had to make the best estimate and there's different categories of ore in that ore body. Some.
Call. It T. Two T. One yeah, we had different carriers and some of them are more recoveries over time, you get the gold out but the the leach profile is a lot flatter.
And and and we when we when we manage through this last winter with a new pad, it's much more dynamic because there's no inventory in the pad and we saw a slow a very flat curve developing on the Leach. We also saw recognize that some of the of the ore body is.
As more silica, rich, which which impacts the leach. So what we did is we we've reduced well we in the process of reducing the manpower we've delayed the sick and the lift that seven of the phase 7.5.
<unk>.
Because we've got enough capacity, but we've shifted it out into next year I mean, it's it's getting to the point of managing a block of business. We've mobilized the rigs now because we've got them and we're drilling up the ore body at the same time, we are chasing the exploration opportunities within trucking distance of the mine.
And in the view how is it we didn't just want to keep barreling, along without and you know as as you know my whole being is around knowing your ore body.
So we wanted to get that clearly understood and Theres no impact in the long term opportunities that whether there are but it's good practice to do what we're doing and that's what that's the the reason behind that slowdown. This year of course, you've seen P vs picking up Nevada is picking up so we can cover.
That oh of production out of value there and again.
No from from a Korea when.
When you're in these.
Situations, where it's completely artificial in Argentina, because the exchange rates or artificial so you know it doesn't make a whole lot of sense mining a lot of gold when you're not making a pile of money.
So.
So again all around it's a considered approach.
With you know we've debated it without partners and.
And Shandong and and we've also spent a lot of time with the the province, and and again, what we've done is as is traditional in in Argentina, All big capital projects come with a royalty that goes into a fund to support economic development, and what and and we have a say on hot spin.
And what we've agreed with the provinces were going to use some of those funds to really focus in on.
Employment generation outside the mining industry, which I think is a good thing so all around we we've covered the bases.
Of to be able to manage.
This period.
Good.
Thanks.
Pockets [noise] big funds.
Funds from TD Securities.
I mean, those will open up the Hornets nest and ask you about M&A.
[laughter] with if the proposed deal between Newmont and Newcrest goes ahead.
That'll be market cap on the face of it will be double your production will be double Barrick do you cast strategically about that scale and how big they would become and probably grab a lot of mind share globally from investors right now.
I've never seen that logic work by the way.
Because as you know in and mining it sort of doesn't fit with this question of well that used to be asked by you too haven't you've got too many assets.
Getting big for the sake of getting big doesn't make a whole lot of sense to me certainly with my money.
And I believe our shareholders wouldn't like that either.
Growing the business is absolutely a focus and so we are well you know we are obsessed about growing our business and growing the value. So that you can take as a given.
We call them C. Much.
But strategic benefit and just getting big for Big Big mistake, and we we don't agree with you that that bolds, a better company with more.
With more grab.
Gravitas are in fact, I believe it's probably adds more risk.
So that's really.
The way, we look at it and we got to watch with interest how this thing progresses.
And if I listen to you correctly during your what you were talking about on the copper side you pick various areas of the World, where you think you want to focus is that where you would be leaning towards more on the M&A front or is that going to be an exploration focus for you both.
I think the interesting thing to your point as.
Well to the point I made earlier and that is that there's a whole lot of people running around promoting metals, you know new modern metals, including copper.
You know the the the real geological and mining skill and knowledge associated with those promotions are quite sudden.
So and and and and and lock the gold industry. The copper industry is equally in and are in a bad place when it comes to inventory haven't invested in the future you look again the results coming out now from these diversified huge amounts of money being made could.
But you cant take all that money and invest it in a locked with magic and find these big deposits. It takes time and we have been working on it for four years, we you'll see going through this year as pop up with new consolidated positions right to them.
The heart of.
Elephant country, and and so right now the opportunity to grow organically if I you know.
It is certainly in our business.
No.
Sort of a preferred way because of the inventory rebuilding but that doesn't just doesn't say we won't pick up on a on an acquisition opportunity if it arises.
And again, we know we as you know we we much more skilled.
Geologists and mining miners as most of our peers and so we have a much better.
Capacity to to call a project early in.
And take more risk on M&A, then wait for the stock to be tied in.
And and and having produced a long time and everyone's running out of options. So we brought it up in and bought them. So that's really that's the way we would position our strategy, but just one more question would you take that a step further as several big copper gold development projects in South America.
Jose Maria for example.
They need a joint venture partner would that be something that Barrick would do yeah.
See it radically absolutely no destination is quite important even though I say asset quality overrides destination, but again, you've seen us exercise sometimes to the frustration of bankers.
To walk away from certain assets, because we're not prepared to go beyond and already.
Extraordinary premium, but absolutely that's our preferred route and we have a we have ongoing conversations and kevin's team on those opportunities all the time.
Yeah.
Thank you. Thanks, Mark this is Ralph <unk> from eight capital.
Mark does the Dorothy discovery change your thinking on how that gets rolled into four mile and then presented into Nevada gold mines right.
This is this does it push it back a little bit prove up the value.
What you want to sort of present that value proposition to newmont, how does how does that discovery change that because I know that theres a structured approach on how that specific assets gets rolled into N. G M.
So it's a very simple approach and its very interesting and we've we have open conversations with with Newmont on these things.
Yeah.
So we have the final say on when it goes in.
Okay.
And it goes in on a formula so what.
If we don't meet that Formula and end with a daughter, who is a full mile. It's a simple formula because of the quality of those deposits.
Once we roll it in from the start.
Get everything back so we split the.
The whole cost of feasibility and all that and then the value of that as it goes in at a market value recognizing premier in the market and in the whole Gambit, So theres no theres no.
Real logic.
For anyone not to participate in developing that project because ultimately it's it's in the best interests of the joint venture.
We can also called up.
You know Pall mall, we can put in some keeps them out whatever the.
They have the opportunity to evaluate these deposits.
Uh huh.
The opportunity to value I don't know why everybody wants to see me I've been just.
Tell me so there's the opportunity to fill.
Fully comprehensively evaluate these types of ore bodies, you have to get underground to drill them. Because you know, it's a one and a half kilometer stretch from the surface.
So again under the joint venture, we can share infrastructure and we can invest in infrastructure from established infrastructure in and gold rush to continue to.
To evaluate these projects or we can come up with somebody else in agreement with our partners and then on top of that the real opportunity in and in this formal development is if we continue if its what we are seeing materializes into what we expect it to.
Two do we.
We can access it from the other side from the northern side and again, we've learned a lot in developing gold rush because if we access that we had actually it is it was a long underground haulage that takes it out right at the at the smelter at the at the Register.
And so because you know getting it out in the mountains. There like we do with gold Rush, then you're still gonna transported subway. So we see that and that ability gives us it significantly changes our 15 year plan because it puts a whole slug of.
Our production at the back end of our 10 year plan and it lifts everything up so so strategically that's what we rarely this is early days, but you know it's.
For me, it's the two things out of this this is very significant when you see those.
And we've got Ah hits around there and some of them you're like Oh. This is Colin country thousand grams, a ton yeah, its a real stuff and it's all breccia so $4.
Much higher grade than than gold rush, it's the same structure, but it's there's a big go intrusion in the Oriel has sort of Britain.
Metamorphosed the rock in such very brittle. So the the mineralization is breaking it up you got these big breccias.
And so so the first thing is you know.
Or are the the fact that we've got the geologist to think block modeling and.
Take these big decisions to drill these depots way ahead of where you where you found the last one.
And so this opens up and now we've got to look across the intrusion as well it would be.
And because of that structure continues through.
And then it also.
I've just been down there last week, what it does is motivate our geologist for other tavis because we've got some significant targets that we where we're developing and it's really this is a product of our team's ability to vector.
These big.
So, Ohio, halos and get into the heart of mineralization. So for me I as and again, you've seen us we've been consolidating ground all around.
<unk> already.
Already large landholding, so where I mean I'm super excited about.
The opportunity because fundamentally Nevada hasn't seen real exploration for a long time.
And you know you've seen us replace I mean, we've mined.
<unk> million ounces, there 9 million ounces since in the four years, we've paid out.
Over $6 billion to shareholders and we've replaced all the volt every month.
This is you know that doesn't happen often and I think that there's a common theme across barrick.
Is look what we're doing we you know we haven't and when we put those two assets together.
Neither of them had a future.
Barrick had better grade, but it had no future plan and newmont's assets on the cloth people had given up we know that because we had to fix infrastructure that completely given up.
Thanks for that and I also want to ask you a question on moly.
And in the mining audit what has come out of those discussions what what do you anticipate to come out of those discussions because you talked about Papa New Guinea in the context of jurisdiction. How are you thinking about Mali right now yeah.
He said people asked me what's your.
Riskier.
The riskiest.
Jurisdiction in your portfolio for my whole 30 is I'll say, it Bali, but bodies delivered more value than any other asset you know in any other country, because we had marella before in.
So this audit is being run by people, who we know really well. These all professional people. This is not a.
Oh gosh attempt.
People out of San Diego, who we know from I'll say like all our investments.
And again, the you know I gave a talk cause the question. That's been asked by the current regime is does.
Gold.
Let her for all volumes, that's the question and so it's up to us as miners and certainly you know we have 10% of the GDP.
So.
The conversation with the finance Minister is always very short.
And we actually.
Are a core component of <unk>.
The Marley and budget to area the Barrick investment.
And so.
Everyone's got a view and that were supposed to start but right. Now we are we don't see that at all and you know we've been through.
Three military regimes.
A pile of incompetent.
Civilian governments.
But we've always come out because we pay.
Dividends and large amounts of tax and we employ.
Marlins.
We've got no expats roots and our executive team in Raleigh, either in the in the capital on the mud. So we you know we manage that and I. You know I was there just a couple of two weeks ago as part of our quarterly visit with everyone. You know we bring it up.
And and and my my encouragement is.
If you look at what the mining is done and Theres no question about that amongst anyone its contribution to developing that very poor country.
So what about shouldn't we be thinking about.
All these revisions to the mining code and with its actually brought anything and isn't it better to two two in the face of all the challenges our reach out and encourage more investment because the one thing about Molly is the investment keeps coming in or has in the past.
Because your monies considered safe because the volumes haven't changed the rules like other countries, but certainly there's a there's a there's a determination to understand and measure the the rules and also there's a big.
Mistrust between the.
The junta.
In the past.
Civilian governments and and some of the transactions that were done in that regime and so there. So this is good if it's done for the right reasons. It's a good thing because it will uncover if there was any Mel administration and otherwise it to give something.
More fundamental which we can share with the people of Mali about the contribution of the money industry.
Hey, its Anita Soni from CIBC, So mark and three questions for you increasingly more difficult.
So the first one I think you mentioned that the la Manana Super pit, you mentioned and we're facing that by the end of 'twenty 'twenty four or was that just a feasibility study or would you have the super pit online by the end of 'twenty 'twenty four.
Do you want to have money for the next one the next question and say, Okay. The capital for 2023, a decline from the the guidance you gave in November I just wanted to understand what the deferral was was that what you referred to with all the arrows that are the majority of that I think about $250 million would have been a deferral developed there or was there something else.
And what number should we be adding on into 'twenty for into 'twenty 'twenty four instead and the last one is just kicking that hornet's nest that greg's already kicked once so and I wanted to give you an opportunity to respond because theres been a lot of sort of conjecture about what your role would be in in the recent M&A in and you've addressed sort of thing.
Gross and you know just taking of things from.
From a big picture perspective, and I think people are speculating, whether or not you would be involved in any kind of break apart scenarios and I just wanted to understand your view on that.
So I need to I'll take the most difficult one first.
And that is.
The capital and grabs going to answer it.
Yeah.
Kind of answer the easy one which is the pre feasibility study, which is gonna be completed at the end of 2024, so to answer the first question, but on the capital.
There were some areas, where we managed to cut some capital a little bit of capital in an N G M and but but rarely Anita.
The truth is the truth be told when we present to you in our in the November Investor Day, We kind of just showed you a bar, which you then kind of took your ruler and got your number.
And then when we guide in with more detail as we do in 2023.
Try and look at where we were actually going to spend.
And.
The reality with capital these days often it but there's a lag between your ambition and what you actually get done yeah. So we try and anticipate that in guidance. So so there isn't any real major change to what we what our target is but we really just trying to give you a little more.
I already on what the likely outcome. So can I just follow up with.
Question on the cost side of the equation knows inched up a little bit from what was in November . So could you just talk about the key drivers for that again, there's a little bit of swings and roundabouts. So you would've seen that there was slightly higher cash cost slightly lower all in sustaining costs. So there's a little bit of swings and roundabouts moving bits.
Tween.
<unk> sustaining capital and operating costs as we.
Optimize some of the mine plans and so that's really all it is it's it's mostly driven by that some areas. We still had some inflationary pressure, where we were adjusting for that the latest input prices and in areas. For example, in a and B, we've got some slightly higher fuel an explosive costs.
Sort of lingering in those areas that we've adjusted in the model, but it's more about just the secret singing and optimization.
A follow up on that one on as we go to 'twenty 'twenty four I'm trying to remember what what are the 'twenty 'twenty four cost structure I remember the capex is pretty similar but the cash costs, where they start to decline or or similar and she'd be using sort of the level that we have now for 2023 'twenty 'twenty four.
In our forecasting we have declining costs in 2024.
That's really driven around our key assumptions around input prices. So its really driven around particular oil and energy prices. So 2023, a key assumption around oil was $90 a barrel, which is very similar to the actual we'll price for 2022 so our input prices for 'twenty 'twenty.
Three are very similar to 2022 in that sense in 'twenty 'twenty four and on a full costing we were assuming oil drops down to 75.
Dollars a barrel.
And so that brings out cost down and and then on the flip side of that.
If you look at our profile, it's increasing slightly so if your costs are.
Coming down and you're increasing your ounces slightly then you also get a little benefit on your cost per ounce.
And then you can add to that and each of the effect that we remember we are heavily investing in green energy and that brings a big saving so you know the the extra sort of installation at Kibali Kibali has been fantastic imagine what kibali would look like on diesel.
And it's you know during the rainy season.
<unk> 96 per cent, Todd right now and we want to try and keep that through the dry season. That's why we are putting in soda to to be able to support that and batteries because we've learned a lot about batteries and ready. The battery is the one that Mike we've got a local grid that makes the grid and so if we can feed.
The battery with solar and hydro, we stabilize the grid and we reduce the amount of and we're doing that across the group we are adding more solar in Lula. So we've learned a lot about managing micro grids with renewable energy and that that will also have a positive impact on our fuel going forward.
And the easiest question.
<unk> of the lot is I'm not going down that rabbit hole.
Thank you.
Thanks, very much this is jackie price unless he from BMO.
I think most of the questions have been answered and thanks for taking so much time with the answers, but I guess I'll just ask a quick one on reco, Jack you know it sounds like you're moving forward with that and fairly quickly and it's it's the impression I'm getting from today's presentation. I know, there's a feasibility study or a technical report coming up soon is there any.
Other catalysts or news events or announcements that we should expect maybe in 2023 before we see that study come out.
So.
I was just getting back to them before I go to the Jackie and each of the the fees, but we got to finish the pre fees.
On the Montana. This year, so you'll have a good handle and then we will.
Full fees into 'twenty 'twenty four so well.
Really focused on being able to understand you know the decision making sooner rather than later.
Richard It we the plan is to get the feasibility complete by the end of next year.
And and.
And really it's a it's around a couple of things power people.
And water.
And infrastructure infrastructure, we've got we believe we've got a strong.
Our initial plan, which is rail.
And then and then it's about building infrastructure north south infrastructure over time.
Water, we have started already.
And.
And we the the plan is we're going to map the entire chugai.
Guy Basin.
Which is and and the objective being that there's a lot of water aquifer water in that basin.
And we're mindful of not sort of.
Punching water from the farmers and so we really want to understand the different depot water systems in that area. Ultimately long term, we'll move to desalination over the long term.
And power are there is an opportunity for geothermal power. So this place where we are where it occurs.
His world headquarters for solar and wind.
But as you know that doesn't offer 24 seven.
So there is a young Ah Ah, but extinct volcano, but a very strong geothermal gradient.
We are currently as we speak mobilizing to drill it.
Busy with the permitting etcetera and and then.
And then our partners of course, there's always all in the oil and gas business.
And and and and and also the.
Well you know the opportunity to linked to the grid all out of the grid has chat.
Challenges on stability.
And so that's the that's part of the feasibility we will so those three are really the focus and of course this baseline studies on environment and social that's already well underway and we had you already started that even last year.
On the technical side of things, we're pretty comfortable with the drilling the drilled out resource we want if we go to finish sort of tech and some.
Do you take hold and we of course, which is instead of our DNA, we got to trim. Some of the holes just to make sure it's Raj.
So and and the G O met and again the technology on flotation has changed materially since 2013 globally and so we're looking at a big swath of our test work on you know Gras inverse recovery and things like that and really looking at a much more modern.
And our approach to a combination and.
And managing of the concentrate.
Sorry.
I was just wondering if we're going to get any sort of uptick okay.
We'll update you as we go.
And you know.
We don't expect any bad surprises, but yeah. Those are the only news really is if there's something that that develops that we haven't already.
Anticipating but we've shared with you a pretty solid.
Concept.
What would what somebody would call scoping as far as the economics and in the development program. The intention is to is to be in development and.
In 2025.
It looks as though you want to say something I just wanted to clarify that it's the pre feasibility study for.
The yamana yeah, it'll be completed in 2024 just to be clear.
What's the problem.
Alright.
Any more difficult question.
Any more easy questions. So there's a lot lunch next door.
Drink so please feel free to stay in.
New York questioning of the team after this.
Okay. Thank you thanks to everyone and thanks to those on the call. Thank you for attending and we look forward to seeing you in person through the next couple of conferences, we gotta be at Bema, and then back up here in P. D. I C. So we look forward to catching up with you. Thanks again.
This concludes today's event should you have additional questions. Please contact the Barrick Investor Relations Department you May now disconnect. Your lines. Thank you for participating and have a pleasant day.
Okay.
[music].
Okay.
Okay.
[music].
Okay.
[music].
Okay.
Yeah.
Yeah.
Okay.
Yeah.
Yeah.