Q2 2023 Barrick Gold Corporation Earnings Call
[music].
Ladies and gentlemen, thank you for standing by this is the event operator.
Welcome to <unk> results presentation for the second quarter of 'twenty twenty-three.
Following today's presentation, a question and answer session will be conducted.
If you have a question in her joining the event by telephone. Please press Star then one on your telephone keypad. We 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 August eight 2023.
I would now like to turn it over to Mark Bristow, President and CEO of Barrick. Please go ahead Sir.
Thank you very much and.
So in controlling this.
Welcome everyone. Good afternoon for those across the Atlantic and good morning for those the sides of the Atlantic and a special welcome to all of you have.
Given up some of the sunny.
Where they're outside to join US personally. Thank you for coming appreciate it.
I think all I felt I should start on a good news story.
Yes.
And and that is that and I'm sure you. All know that's a certainty that I was sitting in AR and the whole yeah.
We saw the average gold price for the last quarter at an all time high and it didn't.
Interestingly a lot of people are suggesting that the gold price is not performing it's performing extremely.
Stream D well.
Hum.
And for me the more interesting part.
Is that some see that says driven by.
Full cost a decline in interest rates and certainly having a.
Recently traveled wrapped around the world.
I I really believe its more about a risk on the situation as we wrestle with.
The global economy, and its and the globalization of the world as a whole and and the fact that China is not I don't leave Gotta get back to where it was it certainly got to recover but not back to where it was and and and again our supply chains and in general investment.
In the economy and and.
And an uplift meant into all of some of those more challenged economies all kind of fit if we don't stop and invest in it and so.
Otherwise or are we going to do is.
Create a future where the rich continue to get richer and the poor get even PURA and so you know we held our.
Models some of it didn't.
Is that a bad last weekend and it was very interesting for me to see the realization.
From Pakistan that things needed to change and there were comments about you know what it's been.
70 years of mistakes and.
This country has everything that it needs.
To get on top of things and what it it's got the people bought fall, but it needs to care about them.
And I, you know I'm drawing from the the leadership that spoke at the opening of the mining summit.
It it it needs to focus on development and not just.
Exploitation.
And finally, it needs to attract foreign investments and in fact administer up to try to and pointed out that their strategy was to turn red tape into a red carpet for investors.
And that is very interesting that's a massive trial decision as and as you noted that country's got many challenges.
And I think we've seen West Africa.
What happens when we neglect these developing countries and and and when we and we've spoken many.
Many times to some of the major.
The economies in the world about ways to Africa, and the importance of staying there and engaging in conversation and working on investment and instead of just left to right.
And and and and and again the the the elected.
Governments right across that region have failed.
And we don't seem to want to do anything about it except lecture.
And so there's a big need for the will to re look at how it manages its business and and again.
As far as the policy towards mining and metals in the United States guys. You know it it has to reflect on.
<unk>.
How important it is just to exploit the other peoples natural resources, rather than develop some of its own and and engage and support and build a real marketing industry because that's.
What's required.
If we got to have a better world ahead of us and so I think that they have and they certainly is conversation starting around those.
Those are topics and and as you know I've spoken a lot about the importance of partnerships and development across the world in Barrick, because hopefully I'll share with you today, what we've done and then now the real results that are starting to materialize now.
Policy of driving partnerships with all host countries.
Out in the World.
And so and I'm also going to spend a little time to date on.
On.
Focusing in on exploration because you know there's ongoing debates Avi you only grow it through M&A and we've put a lot of effort in the last four years and one fixing out assets.
And to building that bench strength and exploration and we've got some initial point is now starting to materialize, which we'll share with you and we're super excited about being able to actually support some of these early results with real borehole Ah results bother.
And all of this current quarter. So that's the sort of outline of my Macy jigawa to get across today.
And.
And I I would start first with just a quick look at Oh before I go further as usual presentation is preceded by a cautionary statement as you see here on this slide. It's also available on our website should you want to study it in more detail.
And then moving on to our Kpis for this past quarter as at the beginning of the year, we we guided them.
Results will be weighted.
Roughly 45 55 in favor of the second half and certainly as you can see that trained is already evident.
In quarter two.
They are proven to have a quota of one.
It was largely due to the completion of.
Of schedule maintenance on.
Collins processing facilities, which boosted in Gm's performance as you see it we'll see it in the number I'll touch on it just now and the strong contributions from our Tanzanian mines and Kibali in particular, Oh and of course, you would've seen to validate a I had a good quarter are better than <unk>.
That.
As always I will highlight the key aspects of our operations as I take you through the presentation at this time.
As I said to point to the progress, we're making on all fronts as far as exploration got.
So looking ahead dispatch.
Hum.
Equipment challenges relating to P V ramp up we remain on track to.
My job gold and copper production guidance for 2023.
And they will should drive the costs.
Back down towards guidance.
And Nevada is expected to build on last quarters close to maintenance improvement P. V will continue to to ramp up throughput to as it expands the plant. We have finished the commissioning, but we've got now and it's stuck in the ramp up.
And in Zambia, the Lamar on a couple of months new fleets is expected at true improve mining productivity and throughput and we land in and better grades in the in the main pit in the back half of this year.
As far as the financial results got.
Increased production helped by the all time average quarterly gold price, which I just referred to delivered a 7% increase in operating cash flow and an increase in adjusted net earnings to 19 cents per share on the back of this quarterly dividend is maintained.
On a Tuesday, and especially Jay and I and I, it's important that I'll point out. The fact that we are managing this company for the long term.
And we're not we are very diligent Tibet, we thought carefully about our dividend policy, we are respecting that policy and not disregarding it we remain the strongest balance sheet in the industry and as we pulled back on the back half of this year, we will build up our cash.
Again materially.
Yeah.
At the beginning of the year, we launched a new safety drive as you all know and we call a journey to zero.
And it went we specifically laid it across the entire group and it certainly started to produce.
Results. If you look at the lagging indicators, which is not what we're using to manage against them. We have the injury frequency rate down 38% quarter on quarter, but what's key is for the first time North America region, the whole North American reads.
Reported an injury free April and so that's a key step in and our commitment to getting.
<unk> operations back way, we expect them to operate as far as safety goes and Latam and the Pacific Region also recorded zero lost time injuries for the entire quarter. So those are key more more important than the lagging indicator trained.
We've.
That's all really tracked our journey to zero and following a full review we've developed a new fatal risks and associated standards standards are showing yeah, along with critical controls of each of the 10 fatal risks and part of our risk management either view, we also reviewed and updated.
Aged all field level risk assessment tool that is standard throughout the organization now and really the big drivers to get every one of us, particularly the leadership completely embracing this journey to zero.
Sustainability is as you all know is central to barrick's.
Strategies and practices and it does what secures a crucially important social license to operate and there were no significant environmental incidents during the quarter and the year to date and our average water use efficiency for quarter, two was 82% and <unk>.
For the half year, 83% and again, beating our 80% target.
Also our greenhouse gas emissions were down 5% quarter on quarter, and 12 foot, 12% against the same period last year.
And as you see on this slide our commitment to biodiversity takes many forms but was exemplified last quarter by the Barrick led and reintroduction of what dry nose to the ground about National Park in the northeastern part of the Democratic Republic of Congo.
And Grand as a National Park, we've been supporting since from Randgold days back in 2000, and none and it's also it's a personal goal of mine to see this happen and it comes with another message and that is you know when we arrived in.
In.
Kibali they didn't watch our gold mines back in 2000 and on the Lord Resistance Army was all over the place and your day.
Fact that we can put brought it back and that pop means we've really got on top of this security. So it's a massive it.
Sort of.
Symbol of what mining can bring to these conflicts zones and and having just come back from Pakistan I'm, absolutely convinced that if we do the Richard there right to get to see the same sort of effect, if not better more tangible in that part.
The part of Baluchistan way, Richard <expletive> is gonna be bolt.
Another key point and I'm not sure. All of you are aware of this but staying with sustainability are also very pleased to announce that we've achieved full conformance with the recently formulated global industry standard on tailings management.
And you would have seen an announcement on Friday.
With the disclosure of information on our website at principal 15 of the standard for a very high and extreme consequence facilities.
And I'll just point out that Barrick.
As a law has long been a leader in the responsible management of tailings storage facilities and we welcome the additional disclosure, which is part of the new standard.
Moving now to the operations, we start as usual with North America, where we continue to build out value Foundation in Nevada Gold mines.
Already far more than the sum of the parts.
That were combined in the merger.
And N G. M is on the cusp of entering a new growth phase as all of them hope to show you and some of the exploration slots.
The knowledge gained from our better understanding of the ore bodies is generating new targets and discoveries as well as new concepts designed to deliver lots of line extensions and potentially the next wave of tier one assets and one of the world's most prolific.
Old districts.
These are the Nevada gold mines operating results with production as I referred to in the introduction up 11% quarter on quarter.
And.
It's remains on track to deliver on its 2023 production plans.
The higher production delivered a meaningful drop in all in sustaining costs as you can see from this slide and and we this is a trend we expect to continue into the second half of the year.
Since creating a Nevada gold mines.
It's worth noting that we've replaced $16 5 million reserve ounces depleted by mining.
And as you can see how we still have a wealth of opportunities.
With the potential to be big value drivers and are confident that exploration all sustain reserve replacement and deliver an inventory that will secure a 15 year planning horizon and beyond and I'll come back to that a replacement strategy because as we had in randgold.
We now developing a plan to replace our reserves through the advancement from inventory to resources into reserves and and in Nevada, We starting to see that plan as well.
There's no better place to start on the slide.
At the top brought.
This review that net the call and trained.
Which is the gift that.
It keeps on giving we continue to insect intersect and this is quite important you'll see at the bottom that twenty-three 001 intersection that we continue these I'll call it top grades.
And and then our quest to expand calling in the gray to.
Leavell conflicts and we continue to consolidate.
The the ground around this and we are talking multi multi million ounce of opportunities and we starting to see that definition and and we're expecting to be able to share some of the holes that we drilled now.
But we're still waiting for the very fond assets, but the one thing I've always said to many of you is that when you hit the world class <unk>.
The bodies you don't have to send the essays the logs to the assay lab to work it out so we're super excited about the the this potential at Cortez. The Barrick owned full model discovery is well on its way to tier one status we shed some of these results.
With you last quarter. These are big numbers. We every intersection now we're starting to to show more and more opportunity and are in the most recent of these discoveries is the Dorothy break Brachia, which you'll see referenced in the slide but these intersection.
<unk> added significant adds is every time, we drill a hole that's the way we are in the ore body today.
Strong drilling results staying with.
With Cortez complex from Robinson would show its potential to grow into a multimillion ounce.
<unk> asset and this is it's a very important Robinson, it's still gonna be permitted we are in the process of permitting it but it's a multimillion odds.
Oxide deposit and that's important for Nevada, because we've got capacity in our oxide, most and and you'll remember that newmont were going to close down their oxide MAU, even before we did the the the.
The deal and we've kept them all off and this is a very key.
As it and we still are.
Looking to expand this footprint, it's been a very successful exploration project and finally at Turquoise Ridge and we've now opened.
The.
Main what we call truck turquoise ridge underground ore body to the north West and the South East and as you see here and again significant intersections and that really and this is you know the the least develop.
Of all the old the world class ore bodies in the know, Nevada operations and I'd, just point pose out for a minute and and just point out that the the the.
Greater legal area and certainly the extension as you see on the slide that's a completely parallel we'll class target that's running parallel to the Goldstrike me coal trade, which is the which is what made calling so famous.
And we are really at a stage of developing a sub parallel talk to a lot of that really key one of the key false which will parallel that that will clauss trained.
That's that is I'll say it hasn't made so many mining companies wealthy.
Barrick also a in addition to our Nevada joint venture continues to expand its north American footprint and drilling is confirming significant discovery potential across the multiple targets in Nevada away from Nevada Gold mines.
And framework drilling has started on a pull string a project as well and.
And ongoing generative work in ground consolidation is progressing across the western United States again, we've got some developing opportunities, which hopefully will be able to share with you in during the next quarter and then Canada.
Mapping and sampling at the pick project near Ham Lott has identified some interesting mineralized structures.
Allergists have also started work on the new stage in life project, and we've signed an agreement to earn up to 75% on the Petrus a project, which is just.
No. It's the way it's along the same trend as melodic so again, we're in the right place.
We're super excited and you know we tried as you know to look at.
Opportunities to grow through M&A, but audiologist, so starting to point to some real opportunities to expand our business here in Canada.
Moving then on to Latin America, and Asia Pacific region. The team has.
A great job.
Particularly the exploration team. We've we are busy rationalizing a large historical land portfolio now as well as in.
Particularly along the Andean trend and we also are moving to secure new opportunities we've expanded our footprint in Chile, the Dominican Republic, and Peru, where we've made some exciting early stage progress, particularly in southern Peru, Agile Austral project.
This region also covers program in Papua New Guinea, and Rick codec in Pakistan, where there have been some very positive developments during the quarter, which I'll take you through.
So starting with P V.
Commissioning as I said in the intro of the expanded plant was impacted by ongoing equipment failures relating to the flotation and Melissa could pumps and we all working with F. L. Schmidt.
To address these issues and rectify some design flaws and and I just explained we've installed the biggest flotation cells ever.
Well it certainly have a.
The biggest debt F. L. Smith is supplied and we've had some issues with the some of the shops and and the gearboxes and we've had two rate retro engineer them and and and and they have also rebuild some new ones and the same thing and so we are busy.
Busy working with them and until we get that settled where we're running all the circuits, but were going to take some time to ramp it up to full production.
We are still expecting a much stronger second half than the first half and the expansion project. We are confident we will achieve its full capacity.
At the end of this quarter, maybe early next quarter.
Once completed the plant expansion and mine life extension have been designed to support an annual production of above 800000 ounces two way beyond 2040, and and and this really does make P. V. A standout T L. One mine and we've got six.
Those are we got a couple in the making and we are very clear about how we define tier one S.
Yes.
And I just to remind you when we did the merger P V.
Was.
If we didn't get a solution on the tailings facility. If it was going to close in 2020. One. So we've now got the permits in place and we're good to go as.
As far as the expansion goes and that's when you try and put a value on that it's like a very big describe it as a 22 million ounce.
Prospects to speak.
As I mentioned, Argentina Valley del Rey exceeded.
Yeah, its planned production, which is particularly commendable considering the very difficult operating environment Argentina's.
One guy in currency crisis has created strong really results from the Mora Escondida target point to point to its potential as a satellite.
Two valid era, we're busy doing that modeling right now and exploration is also focused on those other targets immediately around fair value. There I think the team is now fully motivated having.
Achieved some success with tomorrow Mora and Escondida.
And again, you huge coal we cut back on Valla Dara.
Delayed some of that capital into the end of next year. This is a very dominate that make it. An addition to the currency cross it's an election year, it's an election year, that's being spread over the whole year and so we know now who our governor is in San Juan, but we still got to go through that a rock'n'roll process too.
To get the federal government in place and an elected president.
Okay.
So as I noted again earlier, we're rationalizing I exploration portfolio in Latin America, and prioritizing all portfolios are getting a resource triangle people know what I mean, not exactly what means in order and and we continue to.
Secure more ground in that area. This is a quick snapshot of where we all.
Looking and yeah, we've certainly.
Oh I excited about the prospects and we've got a completely new team. It's taken a couple of years now to get that team to start really understanding what we want and where to go and we're now starting to get those results.
And then flipping across to Pakistan.
The feasibility study at Rico <expletive>.
Made material progress this last quarter and is still scheduled for completion by the end of next year with 2028 are targeted for first production of concentrate infrastructure development is underway and the refurbishment, which is a key thing of the air strip as being a pre.
For flights with a weekly charter and are guiding to flat to two sought.
And in line with our commitment as you see in this and say it.
Too early benefit sharing with the people of Baluchistan, we've already established two primary schools is.
Part of our community investment.
As proposed by the newly formed community development committees. So this is something that's in partnership without communities and.
And by the way I personally along with the senior executive back have been to all of those communities and and it's worth noting you know.
When you look at the Afghan story and you look at this story.
And below cheap the village people all across.
In Afghanistan, and and in blood just out of Pakistan and.
And you see the school and you see that the they're more or less 50, 50 boys and girls.
It's quite an achievement.
And I'll tell you a little bit about but look she's done, particularly around rig codec.
There is no economic activity and so when you give people a chance to earn money, it's amazing what happens and.
It's the only place in the world, where I've seen more schools.
Then kids in.
In fact, all the schools are empty.
And so why because there's such poverty.
The children they have to work.
To survive and so as coming in and supporting the children, giving them scraped meal getting them to school is there any way. They can get educated and this is part of a program that we did.
Very well in in Kibali and that is educating the future operators of demand ahead of the month. So we've done that we started with.
This is a multi generational mine so we've started with junior school.
We've also looked at vocational training of those young teens, and then we've gone abroad and looked at across the.
The universities full.
But lets people who all.
I have a radio finished or about to finish their degrees and particularly.
Particularly in engineering, but engineering some economics.
And and processing and so the first a bunch we've not.
Contracted and they will be moved to our operations around the world and they will start working with us with the intention that they will be the leaders of the operation when we turned it on in a few years' time.
So and again, that's a we we we commissioned kibali with local.
People. So every day most of our workers.
Into the villages around demand and if so the community is.
Our our west coast and and that's our intention.
And.
And Rick for Rick Rick codec as well.
You would've seen some announcements on poker I recently.
Where are at last.
Nearing the end.
[laughter] Jumbos long road.
Towards the mines reopening and.
And the key one is we've applied for the.
Special mining lease.
Which is the one that was removed as you recall at the end of the last lease period, and and two for that to proceeds to close.
We needed to have a number of our regulatory procedures first one is what they call. The warden's hiring that's happened and all the different selected regions and and the we've had a security forum led by the key ministers and the Prime Minister himself and.
And in doing that for them the minister of mines formally open the development for them, which is the critical process, where everyone has a chance to engage and discuss and share what they want and it all ultimately.
Culminate in the mine not culminates in a full mutual agreement across every aspect because they know the negotiating tactics in Papua New Guinea has started 120% and see where you land.
But it is a serious engagement.
And and it will during this process the government will get to a point where it will.
<unk> finalized its own review of applications for the S. M. L. And then we will get that awarded on the back of that we've started the preparation of the mobile fleet are the Ah <unk>. We are after all this time, we've had to upgrade some of the tanks tankage in the.
And the and the processing facility, we have a new crusher in order and you know what.
We're getting ready to to stock up.
And and our expectation is that we should be able to start and get pour out first bar of gold this year.
And every time I say that people say do you have any more granularity on that and I say not but in the fullness of time, we will and I. All I can say is that everyone wants them on started now so you will see the.
Updates as we get closer to that that day.
So with that.
We move across to Africa, and the Middle East and.
This bond U is.
By far the most consistent performer in our portfolio and it's not only a reliable contributor to the bottom line, but also hosts to a wealth of gold and copper opportunities.
The Lula Conculture complex delivered its usual strong performance and and is on track to achieve its 2023 guidance as it continues to invest in greening its power supply grid as well as replenishing its reserves and looking for more and.
Again this has been a spectacular asset.
It would be remiss of me not to point out that Molly is not without its challenges.
And I would add it has never been.
Without these challenges.
We have been operating there for 26 years and in that time Lula.
We built a new logo to Qatar and into one of the world's 10 largest gold mining complexes as well as the as the country's largest taxpayer in employer.
Sydney largest employer outside government.
We've had a constructive relationship with successive governments through some very turbulent times and in recent weeks I've personally engaged with key members of the current leadership.
The proposed new mining code and I'm very optimistic that as in the past, we will find a mutually acceptable way to keep gold shining for Molly.
In West Africa.
Hey, there's a lot of opportunities I pointed out it's a very dynamic place right now as you would have read in the newspaper with the latest Covid and as Jay.
And but staying with Lula, we've we continue to define what a high grade.
Sections on the extensions, allowing the big structures that host the multiple world class a assets are around and within the new logo in Qatar leases.
Wow that was a cross the border in Senegal, we continue to.
Evaluate are the dilemma joint venture in particular, and and we've got the bungee joint venture and we are continuing to expand our footprint in eastern Senegal and in court of law.
We're assessing the funnel Dara satellite deposits and other high priority targets. The team has been extremely successful in adding to the life of mine of tongue.
Moving across to our the Democratic Republic of Congo, and in commodity and Kibali again, Kibali overcame it's first quarter challenges are to.
To deliver substantial improvement as you can see here are in production for quarter, two and it's it has its back on it's this is really set it back on course mm two two.
To achieve its full year guidance and our and we also really focusing on our underground.
Development to build additional.
Flexibility and be able to support the new 10 year mine plan.
And our ongoing exploration rarely has highlighted to mediate lead to the west of the K C. D. A main series of deposits the potential for more of the same and we're quite excited about this a recent development.
And in Tanzania, which is a real success story.
Trigger joint venture with the.
Tanzanian government as a poster child for my thesis that mining can be the force that makes undeveloped countries investable and there's no better example than Tanzania, and it's great to see BHP, putting its toe in the water in Tanzania on the Nikola project.
<unk>.
After Barrick took control of North Mara and Boolean Hulu in 2019, it transform them into operations capable of producing a combined half a million ounces annually.
In other words, a tier one production profile and we have also shown that we can achieve.
This and what you can achieve when a mining company and its host country work together to develop its natural resource endowment.
And last quarter conversion drilling at North Tomorrow placed all the reserves depleted from mining and we mine the first ore from the again a pit.
And additional opportunities for resource conversion bullies gone a very long life nearly.
Well into the Twenty's.
North Florida is just over 10 years, so big focus there and it's worth.
Having a look at this slide and that is we have tier three tier one to range in our central and East African holdings. The Kibali lease here are very covered a new exploration foot print south of Boolean Hulu and high priority permits along the Gulf Coast of Colorado, which I've just referred to.
And.
And again this a good kind of Colorado is an exciting opportunity when we win.
Randgold resources, we always try to get out.
Hands on those extensions and it's taken us a while to secure the permits.
Because they were lapsed they lapsed under the Acacia Tom and so we've now got them and we're starting to evaluate them and we're super excited about the opportunity to extend north borrowers life of mine on the back of that.
We also have a very significant intersection but in eastern Europe again, a pet as you see here and and it's really it's got everyone's attention.
Not sure about how it actually fits into the the ore bodies at the moment, but it's a it's a recently confirmed intersection.
Moving across into Zambia.
And and generally our copper operations as I pointed out to them, while newmont as our wells well set to achieve its guidance for the year. It really is going to have a strong second half and with the implementation of its own them on our strategy and the commissioning of the Robl and commissioning of the new fleet.
Where we we replace the contract which was very expensive. We we've already seen a reduction in in cost says you can see here on the slide and.
And and excited about the prospects of Lamar and Ala Moana has the potential based on our preliminary economic assessment.
To be equivalent to a share of the risk of DIC investment.
That's how significant it is so.
I'd point out that at the time of the merger no one believed in pneumonia it was.
The high cost producers, making no money.
And it's a subsequent transformation into a potential tier one asset in our copper portfolio is another one of barrick's Big success stories, and we're talking about significant reserve conversion on the back of the feasibility study we are busy with and the projected expansion on the back of.
This new Super pit.
As I pointed out that will add significantly to its production and take the mine life to beyond 2016.
And.
So we're on track to complete that next year and and we've scheduled.
Pre construction, starting in 'twenty, and 'twenty, five and and Oh full cost at the moment would bring that expansion from Lamar and I head of the Richard <expletive>.
Delivery on its first.
The concentrate is we've got some and we'll be detailing this on the back of the final studies on both projects.
In Saudi Arabia.
I'll jump I'll say you'd made maintained its consistent production and kept its cost below the guidance ranges.
And our early results from our new property, but not demand are exciting and and really it's a it's it's it's a start of something I believe that's significant and what's more it's been the foundation of us growing our relationship with the.
Kingdom of Saudi Arabia.
Before I just touch on and then the last one is chileans all of all which is largely more of the same.
I would just point out that there really are it's lamont and and and.
And Kibali that all key for the second half delivery.
I mean as a whole, but all the IME operations are on track on top target to meet the guidance.
And then two more slides the one that I referred to Rod in my introduction and that is.
If there's one thing.
More than any other that sits barrick apart.
And I know, it's not snazzy and it doesn't require M&A and all that other stuff.
It's I, it's been our ability to deliver sustained and significant growth in reserves since the merger.
And remember we were all in the same boat often before that in 2019, and and we've replace to 125% of the gold.
That we've mined or the gold equivalent that we monitor including the copper since the time, we started out on a new venture.
And and again, we we will be sharing with the market off strategy of a three year rolling replacement model because we do have some very big assets. So you'll see the inventory bulge and then you'll get a big kick in the resources and then you'll get the conversions in over three years.
We are very comfortable and slowly we will build it into them a shorter term cycle of course, it goes without saying that the contributions we gotta make too.
Copper reserves and resources are significant on the back of the work that we are doing both in Pakistan and also.
And also live on in Zambia, we.
We will continue our work not only to hunt those.
Claus gold deposits.
But also copper.
In all the big copper to rains.
In the world today apart from.
Russia.
But otherwise, we're we're very knowledgeable about what's going on and in the copper.
Big copper fields of the world as we all with the goals and and and and again our view is.
Gross full barrick going forward is based on asset quality and I think that's really when you look at our portfolio today, we've got six tier one proper tier one assets.
Our whole Paul five our world class assets.
<unk> is one of them, it's a 500 plus thousand ounce going to 800 close to a million and some years, we share the economics on just about a 50 50 basis with.
PNG, Inc. So it's a significant share.
All value for Barrick.
We've got of course.
The other area, which is no small asset.
In partnership with engine.
Now we are managing this situation politically.
We've got Lamar not coming on and that's without if we can prove it which we have no doubt we will is it definitely a tier one copper asset.
And of course, Rick codec once we get through the start in and convince everyone. This is a real value as it that's that's right up there with the top five in the World. So you know when you look at all our portfolio tongue on is the one that's the least this fall.
When you look at it but it's a very good cash producer because it's both so well that our sustaining capital is so small and you'll see the mod costs relative to its a total cash costs all in sustaining costs are not as high as other mines and its just about can we find more and at the.
The end of the day.
To close it until close.
Yes.
Yeah.
Yeah.
Yeah.
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Yeah.
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Yeah.
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Pardon the interruption this is <expletive>.
Operator, please standby asbury experiencing technical difficulties.
[noise].
Okay.
[noise] [noise] [laughter].
Hello.
Okay.
Hello.
Can I ask one follow up as well.
Can you talk a little bit about the process from here and what needs to be done.
So really it's the special mining license, which.
We are waiting for which will you know we've done all the other regulatory work we've got everything in place we need that special mining license, which means that we have all the communities signed off.
And and once we can do that with and I had a very you know a very good.
Townhall with all of our key land owners, whereas last day, two weeks ago, and so there's no doubt to everyone who watched this mine opened and it's a very significant deal because Nevada has it have the landowners.
Had the potential to earn so much from a a goldmine.
Or any mine in Papua New Guinea, So yeah, I think theres lots of drivers that of course, there is the they also they.
Obsession with being able to negotiate the terms, which we've already settled but that's the good thing about Papua New Guinea as frustrating as it is is itself full consultation before that a special mining license.
Is issued and and we know Barrick class I and then Barrick had 30 years of no issues.
What's that got that process right and we're very mindful that it is alleged to just society and you Gotta do this thing to the book to make sure that we can mine for another 30 years.
Mark you made a couple of comments about the fundamental outlook of the company being very constructive based on the gold price are based on the growth outlook and then the valuation of the stock where it is I'm wondering what your thoughts are on using some capital towards the buyback going forward.
Yeah, Josh you know that is.
I mean to tell you that scribe mannar almost everyday we have bought back in in the past and and we you know I think we.
Again, we don't want to risk our balance sheet right. Now we are very well positioned we all have an extremely strong balance sheet. We are full costing a growth in cash and that'll trigger.
Our net cash position and as we approach that you know the.
One option, which is the preferred option is to buy your stock back.
Because we absolutely we are completely in agreement with consensus and that is where we're trading below what we should be trading and it makes sense to buy so theres no risk and buying our stock back. It's just how we manage job our balance sheet.
What's that.
Alright, one more question you made a statement about progress being a a world class tier one assets and with our with some comments about our you know bringing up analysts expectations. Because you may be remind US you know what you think the potential economics of a SaaS it looked like it meaning you know what's the initial.
Capital to get this to tier one status and then with the production and cost structure would be thank you.
So the it's a low cost producer because its relatively high grade.
Single refractory also autoclave low crush a more simple process node too well.
The if you look at consensus.
The valuation is.
Around six to 7 billion on consensus process.
5%, 5% discount.
Hum.
So.
And it's about a billion dollars of capital over the next.
10 years.
Slightly white is front end loaded, but again, we've got a bit of work to do on that a lot of it depends on how we treat the way and give them a pet which is not in reserve yet so I'm talking I'm talking about total resource now.
10 years, we've got banked and that's important for us because we get to the 50 50 sharing of economics and an odd intention is that we will we will create.
Create so much value for everyone no one else would want to you know.
The government in Barrick will be partners forever, Yeah. That's the that's the intention so and.
Theres, a big pushback on the western wall of the main pit that we got to address and that's what we are busy with at the moment is designing.
Designing doing that as I say in the in the press release, we are designing that pushback at the moment I think that I can say the underground is bet in better condition than we expected them. So we were happy with that we've had this.
Constant sloughing of the Western wall, which has always been a challenge at at Bora and we need to cut it back and put some put some remedial work into that wall that traction is that there's quite a lot of or on that pushback, so and and what we hope is that we'll be able to pay for that.
Pushback and then you've got the web game of Pet, which is really brings a whole lot of additional resources into.
The mine plan and potentially takes it to 20 years, which gives you that big number if you look at it.
And we're using just that's a broad rough rough value I evaluation on using consensus process.
But the key for us is but in 10 years, we more than get to the 50 347 split economic split and remember we sweep.
All of our costs that we've incurred to.
To date.
The government to equity.
To equalize and once we get there then everyone else benefits, what's important is that the landowners and the province benefit preferentially said, so it's carried equity.
Just to explain to grab you want to add to that.
I think you've done a good job there I mean, the key point, Josh really is that.
When you look at our economic interest there and you contrast, it to the equity interests.
The economic interest is almost double the equity interest because of the way that the cash flow split works.
If you compare it to what you would get in a normal situation if people were paying corporate taxes, and a 3% royalty.
The combination of that economic splitting off the cash flows combined with what Mark just referred to which is the sweep of the cash that we've already spent it means that all economic interest is considerably effectively double them the value of the equity interest would imply.
And and and Josh is this goes back to the Tanzanian deal that we made in.
The point I've been making all along is the probably the mining industries, they're going to invest and promise of the world.
And then they don't make the money because they don't deliver on the plan. So the government gets nothing because all they rely on us Texas. So.
So what we did in Tanzania is we took the economic interest and split it down the middle.
We true it up every year that is a bit complicated, but we do.
So they government gets the tax.
But if we do not pay tax they still get 50%.
It's a much fair way of doing it and and again, Papua New Guinea hasn't be a polo was a special.
And ironically it paid you know.
The the foreign currency crisis in Papua New Guinea is directly because we're not expecting an importing.
Importing golf from program, because it's the biggest producer and the biggest.
Most profitable.
Company in Papua New Guinea.
No.
So that's the same thesis is that the that the prime Minister wanted 51%, which I was very happy to give I mean, it after 30 years. He wanted a different deal. He wanted to make sure that he could get all his legal taxes and he wanted to participate in the equity Ah.
If we deliver on what we planned and if we did and he wanted it still half of the production. So that's what we've agreed to do and and it's a it's a great way of doing business, I believe and and one thing that I need.
Risk is you have to be absolutely convinced you can deliver on your mind and the models that you shared.
And we've done a very similar model in and Rick codec as well slightly more skewed our debt ratio <expletive> is much bigger as it but and also the government are taking a lot of risk in themselves are.
Through this state owned enterprises, and we're gearing it with equity with a global funding package with it with their two I'm sorry, we are gearing it towards debt sorry, he thought equity.
With the global funding package.
Hey, Mark Lawson Winder.
If America.
Thank you for the presentation and nice to see you today and the team I wanted to touch on reserve replacement. So you spoke to the importance of reserve replacement to the value of what is the outlook for this year and which assets do you see driving that outlook.
So Africa will replace them all of its gold and copper that is money.
The one that won't will be.
Latam, but its got to bring a whole lot to earn with Povera and.
And Rick Burdick that fits in that region.
And we've got this new series of projects and.
Around valid era, and we've got some super exciting projects South southern Purdue for Peru in particular, and other parts of of a South America, which we'll share with you in the photo in the next quarter.
A quarter or two.
Nevada Gold mines will will add about between 50 and 60% of its.
Of its current at this year's production, but then it has a big year next year and the following year.
And so that's why what we've said is.
Days on a three year Rolling average, we will continue to replace all the ounces and we will get Nevada, we'd just about there with Nevada like we have in Africa, and and again loss and so much. So that you know where where we're engaged in conversation because in randgold, we used to.
Some of that on incentives are based on.
Reserve replacement at least reserve resource replacement in and and I believe that's a very good metric.
In any mining company to renew them right.
Management on so yeah, that's how how significant we believe in and are in and the importance of organic growth because it makes particularly when you look at because we've got really big assets.
And we have not.
Close to have completed the recapitalization, because the barrick side of our assets will run down.
And both sides of Nevada, Goldmine, well run down.
We're excited was high graded the newmont side. It was just run down and we've recapitalized that we've now got a resource base on the top of that and so if you add to it your returns all significant they become infinite.
Because you're adding.
Answers on our capital base and that's the game you know that's a game about big mining assets is if you've got big.
Big oil bodies, and you've both demand properly.
It produces a lull.
The copper miners are good at that.
That's what makes them.
So valuable.
I wanted to follow up excuse me on a comment you made about the value of their assets, but then the the multiple discount in the market and I mean, I think you make a case here for why the assets are as strong as it should be strong going forward with the reserve growth what is the market missing or has the market missed over the last.
Two years in your view, that's led to that discount.
I would start with the fact that perhaps it starts with the analysts.
And and the management and that we Havent had that conversation and so it's pleasing to see that valuation coming through on a blended consensus basis. So that's a good thing and you know we are very mindful and I'll say this REIT in 2019, we had a job to do.
And you don't build.
No.
Great mining companies easily today, particularly not gold companies. They are tough things to bolt on bolt one myself and now this is the second.
And so you know and and and and again, we are mindful that we have to be able to I mean, we boys I've always been that sort of person I like to support.
I'd like to have that argument is Joshua.
Sure.
Affirmed.
I have to do it on the back of something that's tangible and I think we really all day to day and the first step is you know it's very helpful. When the analyst.
<unk> group are recognizing value and it's even more exciting when there still headroom, which I've just pointed to and and by fall. If you look at our performance what we say what we do how we manage our balance sheet, what we've promised the market we've been consistent.
Like we always all so.
I don't think theres any doubt in the.
In the minds of anyone of course, you know there is some people are a little nervous about where we've gone. There was the same when we went into the D. I'll see you know, but today when you look at the portfolio of assets around the world. The risks are very similar or different.
But similar or the same and and what we've shown is big assets work. If you pay rent, if they're big enough and their valuable enough to deliver value to our house country, It's it and you've I'm sure Lawson you've followed.
United States mining law, and the debate and Rosemont and all that yeah, I work as hard with the team in the U S. As I do in Pakistan and West Africa.
It it's it and gone all the days, where you can run mining companies from a yeah.
16 floor.
Office block in the.
The developed world you have to be out there and and again getting back to how we manage our reserve resource replacement in that as we move that ownership up to the months, we've changed the management to be real business people, who lose literally their minds and they own those assets they've got quality.
She has scientists processing engine is it's not we don't remote control of our business.
From a central corporate office, we do hold them accountable.
And we always they always say to the team you know if you if you go off piste.
Seeing us if you really get off piste, you'll see us all the time until we get you back on track and that's the way we run back.
Like I said operator can remove this.
Mhm.
Alright, so maybe to follow up sorry, Brian Macarthur Raymond James I mean, probably one of your hidden values that you're starting to highlight is the super pit I mean this thing could be.
Do you want its own one of the better copper mines out there in the world place your type of gold credit does it make sense to be have all the copper and barrick going forward given how big a good a copper comfort you're going to have.
Second thing without you probably can't give me everything on the PFS, but 2% to 2060.
Is that a pretty stable production profile out of the Super pit. So again, it's basically duration forever love Big low grade pet pet and what happened is the chimney pet it's got segregated because people yeah Barrick was in a position to try to make money. So it dive down and then chase to grade and.
You know, it's a challenge to chase great in a low grade blended.
Date of entry hosted copper deposit so and what we've done is just going back to geology and and there are a couple of satellite pits that odd genuinely higher grade and lower strip ratio and and and the exciting thing about Nevada.
Tomorrow is that.
We run the risk of doing the whole pushback for the Super pit.
Without going negative cash flow.
Because we have these satellite pits that can so we mine the same strip ratio. If it you know on a copper waste basis, and so that really and that's b. That's our team you know that's what they but once we got the cost down. So we got the cost down are right in the beginning we.
Understood got to know.
There's all bodies and and that and then we looked at the other satellites again, a bit like West Africa, They would know and in the form of anomalies, but nowhere near as ever stuck a hole in them.
So that's what we've been doing.
And we're far down the road on that process. So we were confident enough that we've got enough copper in those satellite pits that will support right. Now we are mining and we got to hit some higher grade zones and Lamar on a pit chimie put now.
And at the same time we've.
Replace the <unk>.
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[laughter].
[noise] [laughter].
Yeah.
Yeah.
[noise].
<unk>.
Yeah.
Yeah.
Uh huh.
Sure.
[noise] [noise] [noise].
Yeah.
[noise] [noise] [noise] put in that slide broadly.
And and so we're you know and and and again, we believe that if you. If you. If you believe in the numbers, which I've always worked on.
Hmm.
The U S has got to have to change the way it manages money and and we have taken that bet to get out there ahead of the.
And again, we're the biggest mine is in there.
The United States already.
And where we're probably the biggest explorer sorry, I stepped out of the box.
We'd probably.
Oh, okay.
We probably the biggest.
Explorer right now in the U S as well.
Thank you.
Anyone else.
Okay.
Operator, we pass back to you for any questions from the call and certainly we will now begin the telephone question and answer session to join the question queue via the phone you May Press Star then one on your telephone keypad.
You'll hear a tone acknowledging your request if you were using a speakerphone. Please pick up your handset before pressing any keys.
She withdraw your question. Please press Star then two.
The first question comes from Cleve Rickard with UBS.
Please go ahead.
Hi, Thanks for taking my question. Good day, everybody can you hear me, okay, yeah perfectly safe.
Excellent. Thanks, Mark we've got a little bit of technical difficulties on the line. So.
I apologize if the question is redundant, but I think in the prepared materials, you've called that Cortez PV and turquoise ridge as.
Some of the assets, where there was there was some maintenance there was some investment done in the first half.
And then you expect that increased production run rate in the second half.
Asked a similar question last quarter do you expect that second half run rate to continue into 2020 for like you know have you done the bulk of the kind of bigger work that you need to do with those mines in order to sustain production at that second half run rate.
Yeah.
Absolutely and look I I'll, let me just take one at a time so the Cortez maintenance Ah is rarely.
Development and are the main the.
Not really actual.
Like protesting maintenance turquoise ridge was a premature hotspot on one of the autoclave and we brought it forward. It was gonna be in quarter three normal planned maintenance again, we brought it forward we changed a lot we use the opportunity to change all of the Gaylord palms and tidy it up we've got quite a bit of work to do.
To get Turquoise Ridge, two way, we want it to be.
The the roaster maintenance was a big maintenance schedule maintenance on the goldstrike roaster more importantly, it was the shut down on the gold quarry Roaster and also we use that shut down to tie in the <unk>.
On the expansion project. So we got one more shutdown to do next year I think it's second quarter schedule for and we'll finish the expansion of our the.
Gold quarry roaster, so not only do we maintain the run rate we lift our throughput capacity in the gold quarry roaster by between 15, and 20% until we bring down the costs and and so we add production capacity because right now in Nevada Gold mines is.
And on double refractory oil processing capacity.
Yeah, we and and and and I you know we've spent a lot of time on planned maintenance to the point that a lot of the planned maintenance was planned because it was neglected.
And and so we are getting back to that to a proper plan may incidents, which is scheduled maintenance, which which is a normal course of business, which is baked into our forecast anyway. So but to answer your question in simple words, yes, you'll see the throughput mainly.
And at a higher rate largely because we add next year.
Right right, that's very clear and then and then one just quick follow up.
The gold rush record of decision is something that.
Continues to come up and sort of our conversations.
Yes.
But there was also a little bit of discussion around some modifications.
Yes.
So on the development side, we are continuing it does start.
Thought impeding production, because we need to get.
Ventilation up ahead of where we are and so if it carries on much further it'll it'll impact production, we've got or that we are looking at the specific impact.
At this stage you know this is all about Rosemont and department of interior and we've been engaged with them all the time and and and again. This this issue about permitting them.
I haven't been realized claims.
And the fact of the met two things.
Gold rush doesn't need a tailings dam.
It doesn't it's mineralized everywhere.
Denise and where we are working it's got a very small footprint because we using already permitted infrastructure. So it doesn't.
Isn't certain even if you wanted to you cant put it into a sort of rosemont argument.
And and it's taken a little while for us to get B L. A M.
The state and particularly the federal.
Part of it too to cure it.
So they have cleared at now so that's why we are pointing to a specific time period, but you know, it's a little bit lock.
Cobra.
We are talking all the time and we are working towards it we have got permission to extend that.
The development under the <unk>.
The exploration permit them in.
And gold rush.
Can run into next year and still get it.
The flexibility in our in place, but we need.
Okay.
[noise] all production.
So that's really where we are and and and and you know every indication is now that it's been cleared.
To finalize V. I S. The first step and then that it goes to the once that's finalized.
The record of decision followed shortly and so.
That's why we've got and we make these forecast in conversation with our local B L. M T.
Alright, very good thank you.
Yes.
Our next question comes from Alan Spence with BNP Paribas Exane. Please go ahead.
Hey, good morning, guys and thanks for the opportunity.
It's got two and I'll just take them one at a time first one on turquoise Ridge Ah Theres, some unplanned maintenance events.
The underground could you just expand on what that was and if that's carried into the third quarter.
Yeah, So we had a.
Fall of ground in.
Part of the development in Turquoise Ridge, which we again as part of our design and changing the design, which we had to step back in and deal with we had a third are shut down on the shaft on some of the safety.
<unk>.
Arrangements in the shop that we we needed to fix and we did that the main main impact was really the the autoclave hotspot, which we had to take the autoclave down and fix it we were scheduled to do that as I said in quarter three we brought it forward so.
On balance across the year it doesn't impact on our production.
That's really the the.
Most important of the unplanned maintenance it was planned but not bad.
Okay understood and then one probably for Graeme just could you talk a little bit cost expectations into the second half how you're seeing the development of labor.
Labor consumables and other items.
Okay.
Yeah.
Okay can you hear us.
Uh huh.
I think the lines back now if you go back yeah.
You wanted to know about inflation in our outlook on that.
Yeah and to the second half please.
So I'll I'll answer of Graham's got a technical challenge here.
So we certainly see costs flattening off.
Some are sort of softening a little but we we we forecast a sticky sort of inflation where around where it is today.
We have some higher costs, which will which are still there.
Ukraine related ammonia men cyanide and things like that.
They they the big driver is in the second half is increased production will bring down our cost as I pointed out in our guidance and and you know we.
We.
Yeah.
You know that we manage that differently, but.
Yeah, I think I don't know Graham now that you've got the Mark.
I think you've got kind of a day Mark I mean.
In terms of the inputs, we comfortable with the assumptions that we were using for 'twenty to 'twenty. Three there are some swings and roundabouts, but generally we're in line so the.
Costs are expected to come down in the second half as the production ramps up and yeah. That's how we that's how we get down there. The other point just to reiterate is that all.
Cost guidance is obviously based on our gold price assumption.
2023 we were using 16 50.
And we've also guided that you know for every $100 change in the gold price that has about a five dollar impact on our cost per ounce. So.
I used to and where we are at the moment, that's about $15 of additional costs compared to the base case assumption. So I think it's important to take into consideration as well.
Alright, Thanks, guys. The audio managed to come back at the end I missed most of that but I'll I'll read the transcript for your whole description. Thanks.
Okay, sorry about that.
The next question comes from <unk> with high tooling International Securities. Please go ahead.
Hi, Mark Omni southbound hi, Tony internationally.
The first one is about stop hold or a project.
How well it did.
The tax issues.
Taken by a bank or a drunk lately in mining.
So.
Good morning.
So we split it 60 40.
It was a it was a.
It was a negotiated settlement that was quite a tough thing to sort of assigned but.
You know we work very closely with engine and chairman channel myself sat down and worked through and allocated some to the Barrick path because the settlement included all way to the new Paul Gras.
Start up so we didn't leave any.
Residual tax assessments behind we cleared the whole thing and sorry, there was some tax that was future based.
Some tax that was specific to the assessment, which was done just before they close the mine and then some are related to the Pos before Xinjian was.
Part of that project. So we worked through that and basically settled as per that out and so it was on a 60 40 basis. So we shared the tax.
Got it thank you.
My second question.
I'll now talk about our church or forecasts or will it be uncle, Paris and the current rate.
Net income for a mining company.
Contact money, probably I'll touch on.
Declining grades and the water shortage, Oh, well, we encountered that program.
Increasing coccaro caught in the future. Thank you.
So you know the one thing.
That's a very important point to make and that is a lot of the copper produced today is from old bonds, which started out as a new bonds and decades ago lot 50 years ago, and and and so that is a challenge and and of course, if you're talking Chile, what has become a big issue.
In Chile, and the copper mining.
On on the assets that we've got a.
We are in and a better leave because of grades generally Rick Burdick comes with gold, which makes it a more attractive.
And Blaine the the risk of it.
And and on the on the water aspect Henri codec, that's one of the critical.
Deliverables on our feasibility study and we're very focused on that as I said, we're gonna be doing the first real in depth. The water study for that whole part of Oh, Pakistan struggle for luxury has done.
But the work that we've already done we're comfortable that certainly for the first 10 years.
Yeah there is.
We we can draw water without impacting those aquifers and theres a lot more that we've I'm sort of certainly part can point to at this stage, but it needs a lot of work ultimately the they are further options I mean as that.
Area that whole T theater, and Metalliferous Bulks gets developed this is gonna be I.
A region, where infrastructure and in particularly desalination is going to have to be part of the big developments going forward.
I got it thank you.
Hey, Mark on the oil content in China.
Thank you very much.
The next question comes from Anita Soni with CIBC World markets. Please go ahead.
Hi, good afternoon, Mark and team and thanks for taking my question.
So I just have one last one I think it's about PV.
And then my apologies for the background noise here, but.
Yeah, I have the opportunity to visit the asset three months ago, and it's definitely an impressive asset.
You were just talking about some issues that you were having with some of the Atmel Schmidt our pieces of equipment can you talk about how you see that evolving in Q3, and then I know you said you would be ramped up in Q4, but can you tell us about how it's going this quarter and what we should be expecting in terms of throughput for this quarter.
So and <unk> to you you would imagine everyone N P V. John Steele, all our engineers from other parts of the world.
No.
Commissioning experts.
F L Smith.
The subject matter experts. So this is a new piece of equipment.
And we've had challenges with the the mm shaft send and the.
The gearbox is we have Uh huh.
Placed them already we.
We are reengineering the some of the design issues as we speak and manufacturing some additional pieces of equipment. So we got back up so we're working on it I mean for me I don't.
Do you have a feel right now because.
Are these sort of start ups.
Happened in AR.
Slash well they can you can work them out you know of a couple of weeks.
But we are waiting for a final.
Plan actual schedule of how are we going to get them back to so we've got and we're able to engineer and replace parts and and an engineer little pieces on and that will get them running but you know we we need to get this thing to full capacity and and you know it.
It would be remiss of me to not point out that this is a big assay is it's kind of a run for 20 plus years.
You know, we we are dealing with it certainly when I sit with the team and I've just come from there.
We still got to have a substantially better second half than first half at P V and you know that's.
That and and.
As of today, we we are still planning to be within the guidance.
Okay Alright. Thank you that's it for my questions.
Thank you Anita.
Your next question comes from Tanya you disconnect with Scotiabank. Please go ahead.
Yes second afternoon, everyone. Thank you for taking my questions and I apologize. If this has already been said that there's a lot of technical issues on this call today, just wanted to circle back to par graph if I could.
Just wanted to confirm that Mark what you said was that we're just waiting for the special mining license. That's on the critical path for us to start up and I. Just wanted to confirm that you said that local communities have all signed off.
Two comments correct. So we are waiting for the special mining lease which is the same thing effectively.
But that's what it's termed them and the landowners agreement as you know we disclosed that way back when there was this conflict between us and government. The landowners. We're on are aligned with us and.
Reinforcing the importance of Paul around getting it back on line. So that's so the equity split is.
A 10% to land owners of which two and a half go to what we call. The L. M P landowners and seven and a half two the okay.
Hey, Sam L landowners, the main owners of the land on which the mine operates and 5% goes to.
The anger province.
And that's the split of course.
Conversation in the development for them.
Evolves around that and also other contracts that are you know that are always in place people like the people living down the river people on on other conversations lock.
Dolomite concessions and other various transitions that we work with and all of that is part of that and of course.
The government is also committed to investing back into program the Pilgrim valley like schooling and and we have been talking about some tax offsets even because yeah theres a real realization of how significant Paul is to the.
Me of.
Of Papua New Guinea.
The answer is yes, and no because this is a process of course, there's always a pull back because we have agreements, but this is a process of consolidation, which is prescribed by the law and the first one is the warden's hiring and that is really defined for the government through the ward and Anne.
Ray.
Two mineral resource authority or the mining department to sit and listen to all interested in affected parties and how theyre there.
Issues proposals whatever and record them.
And and that is a an obligation and then following that the development Forum, which is more of an proper engagement and it doesn't have to be completed.
Straight away.
But once it's the process is far enough advanced the government will make the decision at a point in time on issuing the S. M L.
Okay.
And when we get there somehow.
Can we still assume a six month ramp up if that's the case that's mine to get to full capacity, yeah, I think that once we move onto the site six months is a good topic. Yeah. We all of course put produce called before that but getting it ramped up that's.
That's that's a good assumption.
And should I still be envisioning this mine to produce on a 100% basis.
500000 ounces.
Total cash cost of 900 and all in sustaining cost of 500 is that still a reasonable number.
That's a fair guess at this stage.
We'll update it as we got I think 10 here once we're up and running we'll share some updated numbers with you, but we will get once we get our startup plan, which is what we're working on and we will guide you, but yeah. We've got those guidance out and they will stick until we change that and the.
To wrap up as you know.
If it goes ahead of that so are you working on 500.
As a first crack is reasonable on a 100% by itself could of course, it goes a lot higher than that within a couple of years.
Okay, Alright, I'll wait for that made a lot of mine plan, which would that be coming at you know once we get the software you can read them.
A lot of the same Humphrey alright.
With your guidance.
Exactly.
When we when we announced that we exited.
I'll, let Graham Miao trying to sort.
Sort of Dodge the bullet.
I think Tony I think Oh things going according to plan in February when we do our normal and.
Got it and this is probably the best guess.
Okay. Thanks for that that Graham.
And just on the reserve replacement because again its technical issues I just wanted to understand as a company overall did I correctly understand that this year.
Likely seen more increases to resources and not necessarily reserves or is that a fair statement that that is correct yes.
And that reserve replacement, you can see occurring in Africa on multiples and copper.
And not in Latam that also and not quite into that area.
But you'll see that rolling up next year.
Okay Alright.
So that's helpful. And then just lastly, just on the am Yeah. Yeah, you know overall resources for the company with that has been an increase in gold and copper for bulk.
Oh, yes, yes, its mined copper and gold.
Okay overall at the last second to last slide.
Yeah Yeah.
Yeah.
Okay No that's perfect. Thank you so much right.
Thank you.
Our final question comes from Martin <unk> with Veritas investment Research. Please go ahead.
Thank you.
I have two questions the first one and lunar one.
Can you maintain or are you talking about much high grading in second half compared to Q2 can.
Can you give us some idea of what do you mean in terms of higher grade and second half.
Hello, Hi, great in Oman, as low grade anywhere else [laughter].
So it's not a lot, but it's more consistent and and slightly I agreed.
I mean, I cant comex they compare.
Care to a Q2 are we talking 10 or 15% during the second half.
10, 10%, there's a good number.
Okay. That's fair that's fair.
In Q Kibali.
You had a good recovery.
Can you maintain or improve production in second half compared to Q2, we've got a good second half for Kibali. It's good overall.
You know the second half yeah, it's it's really consistent with quarter. Two so that's the kind of run rate that we expect for the rest of the year.
Okay fair enough.
Thank you very much.
As there are no more questions from the conference call.
I would like to invite you for.
Our snack and a glass of wine, we thought we'd break the tradition here.
Numeric so join us.
Thank you everyone.
Okay.
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.
Okay.
[music].
Yeah.
Yeah.
Okay.