Barrick Gold eyes assets, exploration as it plots new phase

TORONTO/LONDON: Barrick Gold Corp (ABX.TO), soon to become the world’s largest bullion miner, is interested in adding more copper assets as long as the red metal is accompanied by bullion, executives said on Friday.

Barrick, which expects to complete its $6.1 billion takeover of Randgold Resources (RRS.L) Jan. 1, outlined plans for exploration, expansion, streamlining and asset sales at an investor presentation in London.

Structured under regions in North America, South America and Africa and the Middle East, Barrick spent the last four days focusing on where to take the merged company, said Randgold Chief Executive Officer Mark Bristow, who will be Barrick’s new CEO.

Barrick is open to copper assets “as long as that copper is a component or co-product to the gold,” said Rod Quick, who heads Randgold’s projects and evaluation and will do the same in the merged company. “Or, unless that copper project will enhance our strategic partner network.”

In Africa, Barrick is open to exploiting its “substantial footprint” in the Democratic Republic of Congo to acquire world-class deposits, said Willem Jacobs, who heads Randgold’s operations in central and east Africa and becomes Chief Operating Officer of Barrick’s Africa and Middle East region.

In Zambia, Barrick aims to lower costs at its “relatively low-grade” Lumwana copper mine, he added, noting the country’s new mining code stands to materially affect margins.

Barrick said it is keen on exploration outside its operating base, flagging South America’s Guyana Shield, which crosses Suriname, Guyana and French Guyana. It also wants more exposure in Canada.

Rob Krcmarov, executive vice president of exploration, said Barrick is interested in “copper opportunities” within its operating regions that meet investment criteria.

To approve projects with potential for more than 5 million ounces of gold, Barrick will require a 15-percent rate of return, based on a $1,000 gold price, said Quick. Projects with more than 3 million ounces of gold, need a 20-percent return.

Barrick expects stronger operating cash flows, non-core asset sales and lower overhead and interest costs will help it increase future dividends, said Randgold Chief Financial Officer Graham Shuttleworth, who takes the same role at Barrick.

Talks are underway to sell Barrick’s Lagunas Norte mine, said Mark Hill, COO of Latin America. Barrick said in August the Peru mine was an example of the non-core mines it would look at selling. Reuters reported last year that Barrick was exploring options, including the sale of all or part of, Lagunas Norte.

Read More

Tajikistan launches giant dam to end power shortage

ROGUN: Tajikistan on Friday inaugurated a $3.9 billion hydro-electric power plant, a mega project that will enable the impoverished country to eliminate domestic energy shortages and export electricity to Afghanistan and Pakistan.

Built on the Vakhsh River in southern Tajikistan, the plant championed by President Emomali Rakhmon is expected to reach a height of 335 metres (1,099 feet) in a decade, becoming the world’s tallest hydro-electric dam.

The first of six turbines in the Rogun hydroelectric dam goes online on Friday, with the power plant expected to reach capacity of 3,600 megawatts — the equivalent of three nuclear power plants — when completed.

At present, Rogun still resembles a vast construction site, with rocky earth covering the territory from which the powerful Vakhsh flowing through the Pamir mountains was diverted.

In 2016, Rakhmon, who is a former collective farm boss, climbed into a bulldozer at a groundbreaking for the dam, in a sign of the president’s personal attachment to the project.

It will double energy production in the country of nearly nine million people, alleviating a long-lasting, debilitating national energy deficit. Surplus energy will be sold to neighbours such as Afghanistan, Pakistan and Uzbekistan.

Plans to build a dam in southern Tajikistan date back to the Soviet era, but the project was scaled up following the breakup of the Soviet Union in 1991.

In 2017, Tajikistan raised $500 million from an inaugural international bond to help finance the construction.

Authorities hope that once the dam goes online it will generate money to finance further construction.

 ‘National consolidation’ 

Observers say the project is hugely significant for a country that lost tens of thousands of people in a civil war in the 1990s when rebel groups including Islamists rose up against the government.

Rogun has become “a concept for national consolidation,” political analyst Abdugani Mamadazimov told AFP.

There have been calls by public figures to rename the dam after Rakhmon.

Saidjafar Usmonzoda, chairman of the Democratic Party of Tajikistan which is represented in parliament, told AFP such a tribute would only be fitting given Rakhmon’s “heroic accomplishment” making Rogun a reality.

If it ever reaches the planned height of 335 metres, the dam will be 30 metres taller than the recently-built Jinping-I Dam in China and 35 metres taller than Tajikistan’s own Soviet-era Nurek dam, also on the Vakhsh River.

The project overseen by the Italian company Salini Impregilo has a number of risks.

Observers warn that the Tajik authorities do not appear to concern themselves with the environmental sensitivities of Rogun, given Rakhmon’s close involvement.

Rogun is located “in a highly seismic area, and several geological studies have warned about the risks of building such a large dam in this setting,” Filippo Menga, a lecturer in human geography at the  University of Reading in the United Kingdom, told AFP.

Geopolitical tensions surrounding the project have, for the moment, subsided in a region that suffers from water scarcity.

Uzbekistan’s late leader Islam Karimov once hinted that his downstream agriculture-dependent country might go to war over Rogun and a similar project in neighbouring Kyrgyzstan.

But Uzbek opposition to the dam has evaporated since Karimov’s death in 2016 and in an incredible turnaround, the 32 million population could become one of Rogun’s early clients.

Speaking ahead of the launch, deputy head engineer Sukhrob Ochilov summed up the celebratory mood surrounding the keystone project.

“I have been waiting for this moment,” he said.

“Rogun coming online means the construction of new factories, economic progress and jobs for our people.”

Read More