Barrick, Shandong Expand Ties, To Consider Joint Acquisitions
(Kitco News)- Barrick Gold Corp. (NYSE: ABX, TSX: ABX) has entered into an “enhanced strategic cooperation agreement” to shareinformation with China’s Shandong Gold Group Co., Ltd. and possibly undertakenew projects or acquisitions together, Barrick said Monday.
Thedocument builds on an April 2017 deal in which Shandong acquired 50% ofBarrick’s Veladero mine in Argentina for $960 million.
“Over thousands of hours and many site visits,we have worked side by side to deepen our understanding of each other’s values,strategic priorities and operating capabilities,” said John L. Thornton, Barrick’sexecutive chairman. “This agreement will allow us to take our partnership tothe next level, as we jointly explore opportunities to enhance long-term valuefor our respective owners, as well as our government and community partners.”
Besides evaluating joint investment in organicmining projects already owned by one of the two companies, Barrick or ShandongGold have agreed to consider working together on “acquisition opportunities orpotential asset sales, if both parties agree it is in their collective bestinterests,” according to a Barrick news release.
One project in which the two companies maycooperate is Shandong Gold’s current evaluation of mining potential at Lama inArgentina. The study includes possible synergies between Lama and the nearbyVeladero operation. Following the completion of this study, the two parties mayundertake additional studies and technical work to evaluate developmentoptions, including construction of an open-pit mine, feasibility of using heap-leachprocessing for low-grade and easy-to-leach gold ore, and the feasibility ofadopting low-cyanide or “other environmentally friendly” leaching reagents,Barrick said.
The companies have also agreed to share technicalexpertise and other knowledge, as well as provide access to respective suppliernetworks, service providers, investors and capital providers.
By Allen SykoraFor Kitco News
Follow @AllenSykora
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