The world’s largest gold miner believes its gold output will drop in Q3, but says it remains on track to meet its full-year guidance.
Barrick Gold (TSX:ABX,NYSE:ABX) anticipates a drop in Q3 gold output due to ongoing troubles at its Tanzanian unit, Acacia Mining (LSE:ACA).
In its preliminary quarterly report, the world’s top gold miner said it produced 1.24 million ounces of gold from July to September, less than the 1.38 million ounces it produced during the same period a year earlier. Barrick’s Q3 copper production rose to 115 million pounds from 100 million pounds a year ago.
Despite the decline in its gold production, the Canadian company said Thursday (October 12) that it is on track to meet its full-year production forecast of 5.3 to 5.6 million ounces of gold.
“Our operations continue to deliver solid results and remain on track for the year, with third-quarter gold and copper production in line with expectations,” Barrick President Kelvin Dushnisky said in a statement. “As stated previously, we expect higher production and lower costs in the fourth quarter.”
Barrick owns over 60 percent of Acacia Mining, and as mentioned, issues there are largely responsible for the company’s drop in Q3 production. Acacia Mining has been under pressure since the Tanzanian government accused it of evading taxes for years, and was hurt further after President John Magufuli imposed a ban on gold concentrate exports.
Earlier on Thursday, Acacia Mining reported that its gold production declined 8.3 percent, to 191,203 ounces, in the three months to September, impacting Barrick’s total output. The company is responsible for about a ten percent of Barrick’s gold production.
Barrick is looking to end 2017 with $6.4 billion in debt, the lowest since 2010, according to a report last month from Bloomberg Intelligence. The company will publish its full quarterly production and sales results on October 25.
As of 3:00 p.m. EST on Thursday, Barrick’s share price was down 0.12 percent in Toronto, at C$20.86. The company’s share price has lost almost 3 percent since January. Meanwhile, Acacia Mining was down 0.11 percent; it is down almost 50 percent year-to-date.
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Securities Disclosure: I, Priscila Barrera, hold no direct investment interest in any company mentioned in this article.