Barrick Gold Corporation
) announced that it has agreed to form a joint venture with a Saudi
Arabian Mining Co. (Ma'aden) to operate the Jabal Sayid copper mine
in Saudi Arabia.
Both Barrick and Ma'aden will own 50% stake in the joint venture.
Ma'aden, which is controlled by the state of Saudi, has agreed to
buy 50% interest in the project for $210 million (expected to close
in the fourth quarter of 2014). Ma'aden's experience in the Saudi
Arabian mining sector and Barrick's technical and operating
expertise will facilitate the Jabal Sayid project to move ahead.
According to Barrick, the tie-up with Maaden will move the project
along and get the mine into production in late 2015. Once fully
operational, the project is expected to produce about 100-130
million pounds of copper in concentrate per year during its first
full five years of operation. The mine is anticipated to operate
for up to 15 years on the basis of 1.4 billion pounds of copper in
proven and probable reserves as of Dec 31, 2013.
Further, the mine is expected to generate considerable cash flows
and is expected to be a low cost one which will produce high
quality copper. It is also anticipated to be beneficial to the
local community by providing training, employment and by helping in
Barrick released its first-quarter 2014 results in May 2014. The
company's adjusted earnings (excluding one-time items) for the
quarter plummeted to 20 cents per share from 92 cents in the
year-ago quarter but managed to beat the Zacks Consensus Estimate
by a penny. Lower metal prices and a decline in gold sales volumes
led to the decline in earnings.
Revenues fell around 22.6% year over year to $2,632 million in the
reported quarter and missed the Zacks Consensus Estimate of $2,637
million. Average realized price of gold decreased 21.1% year over
year to $1,285 per ounce. All-in costs declined 31.5% to $933 per
ounce while all-in sustaining costs fell roughly 10.7% to $833 per
ounce in the reported quarter.
Gold production fell to 1.59 million ounces in the quarter from
1.8 million ounces a year ago. Copper production declined to 104
million pounds from 127 million pounds in the prior-year
Currently, Barrick carries a Zacks Rank #3 (Hold).
Some better-ranked stocks in the gold mining industry include
Trimmins Gold Corp.
Pretium Resources Inc.
Agnico Eagle Mines Limited
). While Trimmins Gold and Pretium Resources sport a Zacks Rank #1
(Strong Buy), Agnico Eagle holds a Zacks Rank #2 (Buy).
Want the latest recommendations from Zacks Investment Research?
Today, you can download 7 Best Stocks for the Next 30 Days.
Click to get this free report
PRETIUM RES INC (PVG): Free Stock Analysis
BARRICK GOLD CP (ABX): Free Stock Analysis
AGNICO EAGLE (AEM): Free Stock Analysis Report
TIMMINS GOLD (TGD): Free Stock Analysis Report
To read this article on Zacks.com click here.