Barrick says global gold reserves rose 23% last year

Barrick Gold (TSX: ABX, NYSE: GOLD), whose stock price has lagged those of rivals amid woes in Africa and elsewhere, said global gold reserves jumped 23% last year after a new assessment of Pakistan’s giant Reko Diq project.

Attributable proven and probable gold reserves increased by 17.4 million oz. in 2024 before depletion, Toronto-based Barrick said Thursday in a release. Proven and probable mineral reserves now stand at 89 million oz. grading 0.99 grams per tonne, up from 77 million oz. at 1.65 grams a year ago, the company said.

Operating issues and regulatory challenges in countries such as Mali, Papua New Guinea and the Dominican Republic have weighed on Barrick’s stock, offsetting the tailwinds provided by rising gold prices. Barrick last month had to suspend operations at its Loulo-Gounkoto complex in Mali after the military-led government moved gold stocks to a custodial bank. Mali claims the miner owes it US$512 million in back taxes. 

Shares of Barrick have dropped about 6% in Toronto trading over the last five years even as gold prices set new records, Google Finance data shows. The iShares S&P/TSX Index Global Gold Index ETF, meantime, has gained about 57% over the period. Barrick were little changed at $24.54 Thursday in early afternoon trading in Toronto, giving the company a market value of about $42.4 billion.

‘Transformational projects’

Barrick, the world’s third-biggest gold miner by market capitalization, is betting on so-called “transformational” projects such as Reko Diq, the Lumwana super pit expansion in Zambia, Pueblo Viejo in the Dominican Republic and wholly owned Fourmile in Nevada to boost output organically. The company says it has replaced more than 180% of depleted gold reserves since the end of 2019 by adding almost 46 million ounces of attributable proven and probable reserves.

Barrick to invest $2 billion in Zambia copper mine expansion

Barrick’s reserve replacement strategy aims to “add value by delineating ore body extensions and satellites at our long-term reserve prices rather than diluting the quality of our reserves through lifting reserve prices beyond the relative levels of cost inflation,” said Mineral Resource Management and Evaluation Executive Simon Bottoms.

Following the completion of a feasibility study, the conversion of Reko Diq copper-gold resources to mineral reserves added 13 million ounces of gold at 0.28 grams per tonne on an attributable basis, Barrick said Thursday.

Copper mineral reserves more than tripled year-on-year to 18 million tonnes, with a higher grade, as feasibility studies at Lumwana and Reko Diq affirmed both properties as so-called Tier One projects, Barrick also said. The average grade of 0.45% marks an improvement from 0.39% a year ago.

Reserves are based on an updated gold price assumption of US$1,400 per oz. and a consistent copper price of US$3 per pound, Barrick said. Resources are reported inclusive of reserves and for 2024 are based on an updated gold price of US$1,900 per oz. and a consistent copper price of US$4 per pound.

Copper strategy

Reko Diq is a critical component of Barrick’s strategy to expand its footprint in copper, a metal central to the global energy transition.

The project is located in the Chagai mountain range, part of the Tethyan Magmatic Arc, known for its rich copper-gold deposits. It’s projected to generate about US$74 billion in free cash flow over the next 37 years, based on consensus long-term commodity prices, CEO Mark Bristow said last month.

Barrick will allocate some US$5.5 billion to develop the mine’s first stage, he said. Reko Diq, in which the governments of Pakistan and the province of Balochistan have a combined 50% stake, is expected to produce 200,000 tonnes of copper concentrate and 250,000 oz. of gold annually in its first years. 

The starter mine is scheduled for completion by 2029. A second stage, requiring an additional investment of $3.5 billion, is projected to double production, Bristow has said.