The no of the world. 2 gold miner, Barrick, (NYSE: GOLD) said Thursday it expected a 15% drop in gold production in the second quarter due to coronavirus-induced disturbances in an Argentine mine and of a dispute in Papua New Guinea.
In May, Barrick lowered its original production forecast for 2020 after encountering a dispute with the Papua New Guinea government over the Porgera gold mine.
In April, the Papua New Guinea government refused to extend the expired lease on the Porgera gold mine, forcing the company to maintain the mine and lower its forecast for attributable gold production for the whole year .
The company announced second-quarter preliminary sales of 1.22 million ounces of gold and 123 million pounds of copper on Thursday, as well as preliminary production of 1.15 million ounces of gold and 120 million pounds of copper in the second quarter.
Barrick’s gold production for the first six months of 2020 was 2.4 million ounces, in the middle of the company’s 4.6 to 5 million ounce guided range for the year.
CEO Mark Bristow said the results positioned Barrick well to meet his goals for the year, despite the impact of the global covid-19 pandemic and the resulting bottlenecks.
“Comprehensive programs to control the spread of Covid-19 are in place in all of Barrick’s operations, and Barrick continues to take steps to manage the impact of the pandemic on its operations,” said Bristow in a statement. Press release.
Barrick said cost of sales of gold per ounce in the second quarter should be 4% to 6% higher, total cash costs per ounce should be 2% to 4% higher and all-in sustaining costs gold (AISC) per ounce are expected to be 7% to 9% higher, respectively, than in the first quarter of 2020.
Copper sales of 123 million pounds of copper were also higher than in the previous quarter. Cost of copper sales per pound is expected to be 5% to 7% higher than the previous quarter, C1 cash costs per pound expected to be online and AISC copper is expected to be 4% to 6% higher, respectively, than the first quarter of 2020.
Barrick also announced Thursday that it will cut power to townships near the Porgera gold mine to cut costs.
The company said in a statement from the operator of the Barrick (Niugini) Ltd mine that “due to the necessary cost reductions” the electricity that the mine provides free of charge to neighboring communities would not be supplied from Friday until 12 noon per day.
Barrick’s share price on Thursday was 2.31% lower on the NYSE. The company has a market capitalization of $ 46.73 billion.
Barrick has announced that it will release its second quarter financial results on August 10.