EX-99.2 3 d572113dex992.htm EX-99.2 EX-99.2

Exhibit 99.2

 

LOGO

Management’s Discussion and Analysis (“MD&A”)

Quarterly Report on the Third Quarter of 2023

 

This portion of the Quarterly Report provides management’s discussion and analysis (“MD&A”) of the financial condition and results of operations, to enable a reader to assess material changes in financial condition and results of operations as at, and for the three and nine month periods ended September 30, 2023, in comparison to the corresponding prior-year periods. The MD&A is intended to help the reader understand Barrick Gold Corporation (“Barrick”, “we”, “our”, the “Company” or the “Group”), our operations, financial performance as well as our present and future business environment. This MD&A, which has been prepared as of November 1, 2023, is intended to supplement and complement the condensed unaudited interim consolidated financial statements and notes thereto, prepared in accordance with International Financial Reporting Standards (“IFRS”) as issued by the International Accounting Standards Board (“IASB”), including International Accounting Standard 34 Interim Financial Reporting (“IAS 34”), for the three and nine month periods ended September 30, 2023 (collectively, the “Financial Statements”), which are included in this Quarterly Report on pages 84 to 88. You are encouraged to review the Financial Statements in conjunction with your review of this MD&A. This MD&A should be read in conjunction with both the

annual audited consolidated financial statements for the two years ended December 31, 2022, the related annual MD&A included in the 2022 Annual Report, and the most recent Form 40–F/Annual Information Form on file with the U.S. Securities and Exchange Commission (“SEC”) and Canadian provincial securities regulatory authorities. These documents and additional information relating to the Company are available on SEDAR at www.sedar.com and EDGAR at www.sec.gov. Certain notes to the Financial Statements are specifically referred to in this MD&A and such notes are incorporated by reference herein. All dollar amounts in this MD&A are in millions of United States dollars (“$” or “US$”), unless otherwise specified.

For the purposes of preparing our MD&A, we consider the materiality of information. Information is considered material if: (i) such information results in, or would reasonably be expected to result in, a significant change in the market price or value of our shares; (ii) there is a substantial likelihood that a reasonable investor would consider it important in making an investment decision; or (iii) it would significantly alter the total mix of information available to investors. We evaluate materiality with reference to all relevant circumstances, including potential market sensitivity.

 

 

Abbreviations

 

 

 

BAP    Biodiversity Action Plans
BLM    Bureau of Land Management
BNL    Barrick Niugini Limited
CDCs    Community Development Committees
CHUG    Cortez Hills Underground
CIL    Carbon-in-leach
Commencement Agreement    Detailed Porgera Project Commencement Agreement between PNG and BNL
DRC    Democratic Republic of Congo
E&S Committee    Environmental and Social Oversight Committee
ESG    Environmental, Social and Governance
ESG & Nominating Committee    Environmental, Social, Governance & Nominating Committee
ESIA    Environmental and Social Impact Assessment
FEIS    Final Environmental Impact Statement
GHG    Greenhouse Gas
GISTM    Global Industry Standard for Tailings Management
GoT    Government of Tanzania
IASB    International Accounting Standards Board
ICMM    International Council on Mining and Metals
IFRS    International Financial Reporting Standards
IRC    Internal Revenue Commission
ISSB    International Sustainability Standards Board
KCD    Karagba, Chauffeur and Durba
Kumul Minerals    Kumul Minerals Holdings Limited
LTI    Lost Time Injury
LTIFR    Lost Time Injury Frequency Rate
MAA    Multiple Accounts Analysis
MRE    Mineral Resources Enga Limited
MVA    Megavolt-amperes
MW    Megawatt
NOA    Notice of Availability
NGM    Nevada Gold Mines
NSR    Net Smelter Return
OECD    Organisation for Economic Co-operation and Development
PFS    Prefeasibility Study
PNG    Papua New Guinea
Randgold    Randgold Resources Limited
RC    Reverse Circulation
RIL    Resin-in-leach
ROD    Record of Decision
Roundtable    Environmental, Social and Governance Raters Roundtable
SDG    Sustainable Development Goals
SML    Special Mining Lease
TCFD    Task Force for Climate-related Financial Disclosures
TRIFR    Total Recordable Injury Frequency Rate
TSF    Tailings Storage Facilities
TW    True Width
WGC    World Gold Council
WTI    West Texas Intermediate
 

 

 

 

BARRICK THIRD QUARTER 2023    1    MANAGEMENT’S DISCUSSION AND ANALYSIS


Cautionary Statement on Forward-Looking Information

 

 

Certain information contained or incorporated by reference in this MD&A, including any information as to our strategy, projects, plans or future financial or operating performance, constitutes “forward-looking statements”. All statements, other than statements of historical fact, are forward-looking statements. The words “believe”, “expect”, “anticipated”, “vision”, “aim”, “strategy”, “target”, “plan”, “opportunities”, “guidance”, “forecast”, “outlook”, “objective”, “intend”, “project”, “pursue”, “develop”, “progress”, “continue”, “committed”, “budget”, “estimate”, “potential”, “prospective”, “future”, “focus”, “during”, “ongoing”, “following”, “subject to”, “scheduled”, “may”, “will”, “can”, “could”, “would”, “should” and similar expressions identify forward-looking statements. In particular, this MD&A contains forward-looking statements including, without limitation, with respect to: Barrick’s forward-looking production guidance, including anticipated gold production for the fourth quarter of 2023 and our expectation of a shortfall (and the magnitude of the expected shortfall) in 2023 annual gold production relative to Barrick’s previously announced 2023 guidance; estimates of future cost of sales per ounce for gold and per pound for copper, total cash costs per ounce and C1 cash costs per pound, and all-in-sustaining costs per ounce/ pound; cash flow forecasts; projected capital, operating and exploration expenditures; the share buyback program and performance dividend policy, including the criteria for dividend payments; mine life and production rates; projected capital estimates and anticipated permitting timelines related to the Goldrush Project; our plans and expected completion and benefits of our growth and capital projects, including the Goldrush Project and expected timing for commercial production, Fourmile, Pueblo Viejo plant expansion and mine life extension project, including estimated capital costs, expected timing for completion of commissioning of the plant expansion and the completion of the feasibility study for the El Naranjo tailings storage facility, the Veladero Phase 7 leach pad project, the Reko Diq project, solar power projects at NGM and Loulo-Gounkoto, the Jabal Sayid Lode 1 project and new mobile equipment fleet at Lumwana; the planned updating of the historical Reko Diq feasibility study and targeted first production; the potential for Lumwana to extend its life of mine through the development of a Super Pit and expected timing of the feasibility study and targeted first production; the potential for an underground option at Long Canyon; capital expenditures related to upgrades and ongoing management initiatives; our ability to identify new Tier One assets and the potential for existing assets to attain Tier One status; Barrick’s global exploration strategy and planned exploration activities; the timeline for the implementation of the definitive agreements in accordance with the Commencement Agreement between PNG and BNL; the duration of the temporary suspension of operations at Porgera, the conditions for the reopening of the mine including the execution of compensation agreements with local landowners and the timeline to recommence operations; our pipeline of high confidence projects at or near existing operations; potential mineralization and metal or mineral recoveries; our ability to convert resources into reserves; asset sales, joint ventures and partnerships; Barrick’s strategy, plans and targets in respect of environmental and social governance issues,

including climate change, GHG emissions reduction targets (including with respect to our Scope 3 emissions and our reliance on our value chain to help us achieve these targets within the specified time frames), safety performance, responsible water use, TSF management, including Barrick’s conformance with the Global Industry Standard on Tailings Management, community development, biodiversity and human rights initiatives; and expectations regarding future price assumptions, financial performance and other outlook or guidance.

Forward-looking statements are necessarily based upon a number of estimates and assumptions including material estimates and assumptions related to the factors set forth below that, while considered reasonable by the Company as at the date of this MD&A in light of management’s experience and perception of current conditions and expected developments, are inherently subject to significant business, economic and competitive uncertainties and contingencies. Known and unknown factors could cause actual results to differ materially from those projected in the forward-looking statements and undue reliance should not be placed on such statements and information. Such factors include, but are not limited to: fluctuations in the spot and forward price of gold, copper or certain other commodities (such as silver, diesel fuel, natural gas and electricity); risks associated with projects in the early stages of evaluation and for which additional engineering and other analysis is required; risks related to the possibility that future exploration results will not be consistent with the Company’s expectations, that quantities or grades of reserves will be diminished, and that resources may not be converted to reserves; risks associated with the fact that certain of the initiatives described in this MD&A are still in the early stages and may not materialize; changes in mineral production performance, exploitation and exploration successes; risks that exploration data may be incomplete and considerable additional work may be required to complete further evaluation, including but not limited to drilling, engineering and socioeconomic studies and investment; the speculative nature of mineral exploration and development; lack of certainty with respect to foreign legal systems, corruption and other factors that are inconsistent with the rule of law; changes in national and local government legislation, taxation, controls or regulations and/or changes in the administration of laws, policies and practices; the potential impact of proposed changes to Chilean law on the status of value added tax refunds received in Chile in connection with the development of the Pascua-Lama project; expropriation or nationalization of property and political or economic developments in Canada, the United States or other countries in which Barrick does or may carry on business in the future; risks relating to political instability in certain of the jurisdictions in which Barrick operates; timing of receipt of, or failure to comply with, necessary permits and approvals, including the issuance of a ROD for the Goldrush Project and/or whether the Goldrush Project will be permitted to advance as currently designed under its Feasibility Study, the environmental license for the construction and operation of the El Naranjo tailings storage facility for Pueblo Viejo, and assessments required to optimize Long Canyon’s life of mine; non-renewal of key licenses by governmental authorities; failure to comply with environmental and health and safety laws and regulations;

 

 

 

 

BARRICK THIRD QUARTER 2023    2    MANAGEMENT’S DISCUSSION AND ANALYSIS


increased costs and physical and transition risks related to climate change, including extreme weather events, resource shortages, emerging policies and increased regulations relating to related to greenhouse gas emission levels, energy efficiency and reporting of risks; contests over title to properties, particularly title to undeveloped properties, or over access to water, power and other required infrastructure; the liability associated with risks and hazards in the mining industry, and the ability to maintain insurance to cover such losses; damage to the Company’s reputation due to the actual or perceived occurrence of any number of events, including negative publicity with respect to the Company’s handling of environmental matters or dealings with community groups, whether true or not; risks related to operations near communities that may regard Barrick’s operations as being detrimental to them; litigation and legal and administrative proceedings; operating or technical difficulties in connection with mining or development activities, including geotechnical challenges, tailings dam and storage facilities failures, and disruptions in the maintenance or provision of required infrastructure and information technology systems; increased costs, delays, suspensions and technical challenges associated with the construction of capital projects; risks associated with working with partners in jointly controlled assets; risks related to disruption of supply routes which may cause delays in construction and mining activities, including disruptions in the supply of key mining inputs due to the invasion of Ukraine by Russia; risk of loss due to acts of war, terrorism, sabotage and civil disturbances; risks associated with artisanal and illegal mining; risks associated with Barrick’s infrastructure, information technology systems and the implementation of Barrick’s technological initiatives, including risks related to cyber-attacks, cybersecurity breaches, or similar network or system disruptions; the impact of global liquidity and credit availability on the timing of cash flows and the values of assets and liabilities based on projected future cash flows; the impact of inflation, including global inflationary pressures driven by supply chain disruptions caused by the ongoing Covid-19 pandemic, global energy cost increases following the invasion of Ukraine by Russia and country-specific political and economic factors in Argentina; adverse changes in our credit ratings; fluctuations in the currency markets; changes in U.S. dollar interest rates; risks arising from holding derivative instruments (such as credit risk, market liquidity risk and mark-to-market risk); risks related

to the demands placed on the Company’s management, the ability of management to implement its business strategy and enhanced political risk in certain jurisdictions; uncertainty whether some or all of Barrick’s targeted investments and projects will meet the Company’s capital allocation objectives and internal hurdle rate; whether benefits expected from recent transactions are realized; business opportunities that may be presented to, or pursued by, the Company; our ability to successfully integrate acquisitions or complete divestitures; risks related to competition in the mining industry; employee relations including loss of key employees; availability and increased costs associated with mining inputs and labor; risks associated with diseases, epidemics and pandemics, including the effects and potential effects of the global Covid-19 pandemic; risks related to the failure of internal controls; and risks related to the impairment of the Company’s goodwill and assets. Barrick also cautions that its 2023 guidance may be impacted by the ongoing business and social disruption caused by the spread of Covid-19.

In addition, there are risks and hazards associated with the business of mineral exploration, development and mining, including environmental hazards, industrial accidents, unusual or unexpected formations, pressures, cave-ins, flooding and gold bullion, copper cathode or gold or copper concentrate losses (and the risk of inadequate insurance, or inability to obtain insurance, to cover these risks).

Many of these uncertainties and contingencies can affect our actual results and could cause actual results to differ materially from those expressed or implied in any forward-looking statements made by, or on behalf of, us. Readers are cautioned that forward-looking statements are not guarantees of future performance. All of the forward-looking statements made in this MD&A are qualified by these cautionary statements. Specific reference is made to the most recent Form 40-F/Annual Information Form on file with the SEC and Canadian provincial securities regulatory authorities for a more detailed discussion of some of the factors underlying forward-looking statements and the risks that may affect Barrick’s ability to achieve the expectations set forth in the forward-looking statements contained in this MD&A. We disclaim any intention or obligation to update or revise any forward-looking statements whether as a result of new information, future events or otherwise, except as required by applicable law.

 

 

 

 

BARRICK THIRD QUARTER 2023    3    MANAGEMENT’S DISCUSSION AND ANALYSIS


Use of Non-GAAP Financial Measures

 

 

We use the following non-GAAP financial measures in our MD&A:

 

“adjusted net earnings”

 

“free cash flow”

 

“EBITDA”

 

“adjusted EBITDA”

 

“attributable EBITDA”

 

“minesite sustaining capital expenditures”

 

“project capital expenditures”

 

“total cash costs per ounce”

 

“C1 cash costs per pound”

 

“all-in sustaining costs per ounce/pound”

 

“all-in costs per ounce” and

 

“realized price”

For a detailed description of each of the non-GAAP financial measures used in this MD&A and a detailed reconciliation to the most directly comparable measure under IFRS, please refer to the Non-GAAP Financial Measures section of this MD&A on pages 59 to 76. Each non-GAAP financial measure has been annotated with a reference to an endnote on page 77. The non-GAAP financial measures set out in this MD&A are intended to provide additional information to investors and do not have any standardized meaning under IFRS, and therefore may not be comparable to other issuers, and should not be considered in isolation or as a substitute for measures of performance prepared in accordance with IFRS.

Changes in Presentation of Non-GAAP Financial Performance Measures

Attributable EBITDA

Starting with this MD&A, we are presenting attributable EBITDA, which removes the non-controlling interest portion from our adjusted EBITDA measure. Prior periods have been presented to allow for comparability. We believe this additional information will assist analysts, investors and other stakeholders of Barrick in better understanding our ability to generate liquidity from our attributable business and which is aligned with how we present our forward looking guidance on gold ounces and copper pounds produced.

Index

 

 

 

 

5   Overview

 

5     Financial and Operating Highlights

9     Key Business Developments

10     Environmental, Social and Governance

13     Outlook

15     Production and Cost Summary

 

17   Operating Performance

 

18     Nevada Gold Mines

19       Carlin

21       Cortez

23       Turquoise Ridge

25       Other Mines - Nevada Gold Mines

26     Pueblo Viejo

28     Loulo-Gounkoto

30     Kibali

32     North Mara

34     Bulyanhulu

36     Other Mines - Gold

37     Lumwana

39     Other Mines - Copper

 

40   Growth Projects

 

43   Exploration and Mineral Resource Management

 

47   Review of Financial Results

 

47     Revenue

48     Production Costs

50     Capital Expenditures

50     General and Administrative Expenses

51     Exploration, Evaluation and Project Expenses

51     Finance Costs, Net

51     Additional Significant Statement of Income Items

52     Income Tax Expense

 

54   Financial Condition Review

 

54     Balance Sheet Review

54     Shareholders’ Equity

54     Financial Position and Liquidity

55     Summary of Cash Inflow (Outflow)

 

57   Commitments and Contingencies

 

58   Review of Quarterly Results

 

58   Internal Control over Financial Reporting and Disclosure Controls and Procedures

 

59   IFRS Critical Accounting Policies and Accounting Estimates

 

59   Non-GAAP Financial Measures

 

77   Technical Information

 

77   Endnotes

 

84   Financial Statements

 

89   Notes to Consolidated Financial Statements

 

 

 

BARRICK THIRD QUARTER 2023    4    MANAGEMENT’S DISCUSSION AND ANALYSIS


OVERVIEW  

OPERATING

PERFORMANCE

 

 

GROWTH PROJECTS &

EXPLORATION

 

 

REVIEW OF FINANCIAL

RESULTS

 

 

OTHER INFORMATION & 

NON-GAAP 

RECONCILIATIONS 

 

FINANCIAL

STATEMENTS

 

Overview

 

 

Financial and Operating Highlights

 

                   For the three months ended     For the nine months ended  
                 
      9/30/23      6/30/23      % Change      9/30/22      % Change     9/30/23      9/30/22      % Change  

Financial Results ($ millions)

                      

Revenues

     2,862        2,833        1 %        2,527        13 %        8,338        8,239        1 %  

Cost of sales

     1,915        1,937        (1)%        1,815        6 %       5,793        5,404        7 %  

Net earningsa

     368        305        21 %        241        53 %       793        1,167        (32)%  

Adjusted net earningsb

     418        336        24 %        224        87 %       1,001        1,106        (9)%  

Adjusted EBITDAb

     1,464        1,368        7 %        1,155        27 %       4,015        4,327        (7)%  

Adjusted EBITDA marginc

     51 %        48 %        6 %        46 %        11 %       48 %        53 %        (9)%  

Minesite sustaining capital expendituresb,d

     529        524        1 %        571        (7)%       1,507        1,514        0 %  

Project capital expendituresb,d

     227        238        (5)%        213        7 %       691        625        11 %  

Total consolidated capital expendituresd,e

     768        769        0 %        792        (3)%       2,225        2,158        3 %  

Net cash provided by operating activities

     1,127        832        35 %        758        49 %       2,735        2,686        2 %  

Net cash provided by operating activities marginf

     39 %        29 %        34 %        30 %        30 %       33 %        33 %        0 %  

Free cash flowb

     359        63        470 %        (34)        1,156 %       510        528        (3)%  

Net earnings per share (basic and diluted)

     0.21        0.17        24 %        0.14        50 %       0.45        0.66        (32)%  

Adjusted net earnings (basic)b per share

     0.24        0.19        26 %        0.13        85 %       0.57        0.62        (8)%  

Weighted average diluted common shares
(millions of shares)

     1,755        1,755        0 %        1,768        (1)%       1,755        1,775        (1)%  

Operating Results

                      

Gold production (thousands of ounces)g

     1,039        1,009        3 %        988        5 %       3,000        3,021        (1)%  

Gold sold (thousands of ounces)g

     1,027        1,001        3 %        997        3 %       2,982        3,030        (2)%  

Market gold price ($/oz)

     1,928        1,976        (2)%        1,729        12 %       1,930        1,824        6 %  

Realized gold priceb,g ($/oz)

     1,928        1,972        (2)%        1,722        12 %       1,934        1,820        6 %  

Gold cost of sales (Barrick’s share)g,h ($/oz)

     1,277        1,323        (3)%        1,226        4 %       1,325        1,211        9 %  

Gold total cash costsb,g ($/oz)

     912        963        (5)%        891        2 %       953        859        11 %  

Gold all-in sustaining costsb,g ($/oz)

     1,255        1,355        (7)%        1,269        (1)%       1,325        1,215        9 %  

Copper production (millions of pounds)g

     112        107        5 %        123        (9)%       307        344        (11)%  

Copper sold (millions of pounds)g

     101        101        0 %        120        (16)%       291        346        (16)%  

Market copper price ($/lb)

     3.79        3.84        (1)%        3.51        8 %       3.89        4.11        (5)%  

Realized copper priceb,g ($/lb)

     3.78        3.70        2 %        3.24        17 %       3.88        3.86        1 %  

Copper cost of sales (Barrick’s share)g,i ($/lb)

     2.68        2.84        (6)%        2.30        17 %       2.90        2.21        31 %  

Copper C1 cash costsb,g ($/lb)

     2.05        2.28        (10)%        1.86        10 %       2.33        1.79        30 %  

Copper all-in sustaining costsb,g ($/lb)

     3.23        3.13        3 %        3.13        3 %       3.25        2.96        10 %  
                 
      As at
9/30/23
     As at
6/30/23
     % Change      As at
9/30/22
     % Change                         

Financial Position ($ millions)

                      

Debt (current and long-term)

     4,775        4,774        0 %        5,095        (6)%          

Cash and equivalents

     4,261        4,157        3 %        5,240        (19)%          

Debt, net of cash

     514        617        (17)%        (145)        454 %                            

 

a. 

Net earnings represents net earnings attributable to the equity holders of the Company.

b. 

Further information on these non-GAAP financial measures, including detailed reconciliations, is included on pages 59 to 76 of this MD&A.

c. 

Represents adjusted EBITDA divided by revenue.

d. 

Amounts presented on a consolidated cash basis. Project capital expenditures are included in our calculation of all-in costs, but not included in our calculation of all-in sustaining costs.

e. 

Total consolidated capital expenditures also includes capitalized interest of $12 million and $27 million, respectively, for the three and nine month periods ended September 30, 2023 (June 30, 2023: $7 million and September 30, 2022: $8 million and $19 million, respectively).

f. 

Represents net cash provided by operating activities divided by revenue.

g. 

On an attributable basis.

h. 

Gold cost of sales per ounce is calculated as cost of sales across our gold operations (excluding sites in closure or care and maintenance) divided by ounces sold (both on an attributable basis using Barrick’s ownership share).

i. 

Copper cost of sales per pound is calculated as cost of sales across our copper operations divided by pounds sold (both on an attributable basis using Barrick’s ownership share).

 

 

 

BARRICK THIRD QUARTER 2023    5    MANAGEMENT’S DISCUSSION AND ANALYSIS


OVERVIEW  

OPERATING

PERFORMANCE

 

 

GROWTH PROJECTS &

EXPLORATION

 

 

REVIEW OF FINANCIAL

RESULTS

 

 

OTHER INFORMATION & 

NON-GAAP 

RECONCILIATIONS 

 

FINANCIAL

STATEMENTS

 

GOLD PRODUCTIONa (thousands of ounces)   COPPER PRODUCTIONa (millions of pounds)

 

LOGO

 

 

LOGO

GOLD COST OF SALESb, TOTAL CASH COSTSc,

AND ALL-IN SUSTAINING COSTSc ($ per ounce)

 

COPPER COST OF SALESb, C1 CASH COSTSc,

AND ALL-IN SUSTAINING COSTSc ($ per pound)

LOGO

 

LOGO

NET EARNINGS, ATTRIBUTABLE EBITDAc

AND ATTRIBUTABLE EBITDA MARGINc

 

CAPITAL EXPENDITURESc,d

($ millions)

LOGO

 

LOGO

OPERATING CASH FLOW AND FREE CASH FLOWc   DIVIDENDSe (cents per share)

LOGO

 

LOGO

 

a. 

On an attributable basis.

b. 

Gold cost of sales per ounce is calculated as cost of sales across our gold operations (excluding sites in closure or care and maintenance) divided by ounces sold (both on an attributable basis using Barrick’s ownership share). Copper cost of sales per pound is calculated as cost of sales across our copper operations divided by pounds sold (both on an attributable basis using Barrick’s ownership share).

c. 

Further information on these non-GAAP financial measures, including detailed reconciliations, is included on pages 59 to 76 of this MD&A.

d. 

Capital expenditures also includes capitalized interest.

e. 

Dividend per share declared in respect of the stated period, inclusive of the performance dividend.

 

 

 

BARRICK THIRD QUARTER 2023    6    MANAGEMENT’S DISCUSSION AND ANALYSIS


OVERVIEW  

OPERATING

PERFORMANCE

 

 

GROWTH PROJECTS &

EXPLORATION

 

 

REVIEW OF FINANCIAL

RESULTS

 

 

OTHER INFORMATION & 

NON-GAAP 

RECONCILIATIONS 

 

FINANCIAL

STATEMENTS

 

Factors affecting net earnings and adjusted net earnings1 - three months ended September 30, 2023 versus June 30, 2023

Net earnings attributable to equity holders of Barrick (“net earnings”) for the three months ended September 30, 2023 were $368 million compared to $305 million in the prior quarter. This increase was mainly due to lower gold and copper cost of sales per ounce/pound2, higher gold sales volume and an increase in realized copper prices1, partially offset by lower realized gold prices1. Net earnings were also favorably affected by lower income tax expense. This was partially offset by losses on currency translation of $30 million, compared to a gain of $12 million in the previous quarter.

After adjusting for items that are not indicative of future operating earnings, adjusted net earnings1 of $418 million for the three months ended September 30, 2023 was $82 million higher than the prior quarter. The increase was primarily due to lower gold and copper cost of sales per ounce2. The decrease in gold cost of sales per ounce2 was mainly due to the impact of sales mix across the portfolio, with a higher contribution of ounces at a lower cost per ounce from Cortez, Turquoise Ridge and Kibali, combined with lower unit costs at Carlin. The lower copper cost of sales per pound2 was primarily due to the improved mining efficiencies at Lumwana. This was combined with higher gold sales volume, primarily due to higher oxide production from the Crossroads open pit and Cortez Hills underground at Cortez. In addition, production was higher at Turquoise Ridge due to planned autoclave maintenance in the previous quarter and at Kibali driven by improved grades. This was offset by lower production at Carlin due to lower open pit ore tonnes mined at a lower average grade as mining in the Goldstar open pit was substantially completed early in the third quarter, leading to a higher proportion of lower grade stockpile tonnes processed at the roasters. Adjusted net earnings1 was also impacted by a lower realized gold price1, partially offset by a higher realized copper price1. The realized gold and copper prices1 were $1,928 per ounce and $3.78 per pound, respectively, in the three months ended September 30, 2023, compared to $1,972 per ounce and $3.70 per pound, respectively, in the prior quarter.

Factors affecting net earnings and adjusted net earnings1 - three months ended September 30, 2023 versus September 30, 2022

Net earnings for the third quarter of 2023 were $368 million compared to $241 million in the same prior year period. This increase was mainly due to higher realized gold and copper prices1, combined with higher gold sales volumes. This was partially offset by higher gold and copper cost of sales per ounce/pound2 and a combined $63 million gain on the sale of a portfolio of royalties to Maverix Metals Inc. and a portfolio of royalties by NGM to Gold Royalty Corp in the same prior year period.

After adjusting for items that are not indicative of future operating earnings, adjusted net earnings1 of $418 million in the third quarter of 2023 were $194 million higher than the same prior year period. One of the primary drivers of the increase was higher realized gold and copper prices1. The realized gold and copper prices1 were $1,928 per ounce and $3.78 per pound, respectively, in the three months ended September 30, 2023 compared to $1,722 per ounce and $3.24 per pound, respectively, in the same prior year period. This was combined with higher gold

sales volumes. The increase in gold sales volume was primarily due to higher oxide production from the Crossroads open pit and Cortez Hills underground at Cortez, combined with higher grades processed, recoveries and throughput at both Turquoise Ridge and Kibali. This was partially offset by lower production at Pueblo Viejo, driven by lower recoveries and lower throughput from premature mechanical failures of the newly installed equipment during the commissioning and ramp-up of the plant expansion. Adjusted net earnings1 were further impacted by higher gold cost of sales per ounce2, mainly due to lower grades processed, partially offset by a lower contribution at higher unit costs from Pueblo Viejo; higher depreciation at Kibali; and higher copper cost of sales per pound2, primarily due to lower grades processed and lower recoveries at Lumwana.

The significant adjusting items in the three months ended September 30, 2023 include:

 

$34 million ($30 million before tax or non-controlling interests) in losses on currency translation, primarily due to the devaluation of the Chilean peso, the Argentine peso and the West African CFA franc; and

 

$19 million in significant tax adjustments, mainly related to the de-recognition of deferred tax assets, adjustments in respect of prior years and the remeasurement of deferred tax balances.

Refer to page 59 for a full list of reconciling items between net earnings and adjusted net earnings1 for the current and previous periods.

Factors affecting net earnings and adjusted net earnings1 - nine months ended September 30, 2023 versus September 30, 2022

Net earnings for the nine months ended September 30, 2023 were $793 million compared to $1,167 million in the same prior year period. Among the drivers of the decrease were a higher gold and copper cost of sales per ounce/pound2 and lower gold and copper sales volumes, partially offset by a higher realized gold price1. Net earnings were also impacted by a closed mine rehabilitation gain of $35 million in the current period compared to $180 million in the same prior year period resulting from a smaller increase in the market real risk-free rate used to discount the closure provision in the current period, compared to the same prior year period.

After adjusting for items that are not indicative of future operating earnings, adjusted net earnings1 of $1,001 million for the nine months ended September 30, 2023 were $105 million lower than the same prior year period. The decrease in adjusted net earnings was primarily due to a higher gold and copper cost of sales per ounce/pound2 and lower gold and copper sales volumes, partially offset by a higher realized gold price1. The increase in gold cost of sales per ounce2 compared to the same prior year period was primarily due to lower grades processed, and higher contractor and maintenance costs, while the increase in copper cost of sales per pound2 was mainly due to higher operating unit costs resulting from lower grades processed, lower recoveries and lower capitalized waste stripping at Lumwana. The lower gold sales volume was primarily at Pueblo Viejo resulting from lower grades processed in line with the planned mining and stockpile feed sequence, and lower throughput due to tie-in and commissioning work related to the plant expansion; at Carlin mainly due to the closure of the Gold Quarry concentrator at the beginning of the second quarter of 2023

 

 

Numerical annotations throughout the text of this document refer to the endnotes found starting on page 77.

 

 

 

BARRICK THIRD QUARTER 2023    7    MANAGEMENT’S DISCUSSION AND ANALYSIS


OVERVIEW  

OPERATING

PERFORMANCE

 

 

GROWTH PROJECTS &

EXPLORATION

 

 

REVIEW OF FINANCIAL

RESULTS

 

 

OTHER INFORMATION & 

NON-GAAP 

RECONCILIATIONS 

 

FINANCIAL

STATEMENTS

 

and the conversion of the Goldstrike autoclave to a conventional CIL process in the first quarter of 2023; and at Long Canyon as Phase 1 mining was completed in May 2022. These impacts were partially offset by higher oxide ore tonnes mined from Crossroads and CHUG, combined with higher heap leach production at Cortez. The decrease in copper sales volume was mainly at Lumwana due to lower grades processed and lower recoveries, partially offset by higher throughput. These unfavourable impacts were partially offset by an increase in the realized gold price1, while the realized copper price1 was in line with the same prior year period. The realized gold and copper prices1 were $1,934 per ounce and $3.88 per pound, respectively, in the nine months ended September 30, 2023, compared to $1,820 per ounce and $3.86 per pound, respectively, in the same prior year period.

The significant adjusting items in the nine months ended September 30, 2023 include:

 

$100 million in significant tax adjustments, mainly related to the settlement agreement to resolve the tax dispute at Porgera, the de-recognition of deferred tax assets, adjustments in respect of prior years and the re-measurement of deferred tax balances;

 

$55 million ($55 million before tax and non-controlling interests) in other expense (income) adjustments in the current year, primarily related to changes in our closed mine rehabilitation as a result of lower discount rate assumptions and care and maintenance expenses at Porgera, and the $30 million commitment made towards the expansion of education infrastructure in Tanzania per our community investment obligations under the Twiga partnership; and

 

$47 million ($56 million before tax and non-controlling interests) in losses on currency translation, mainly due to fluctuations of the Zambian kwacha during the relevant periods.

Refer to page 59 for a full list of reconciling items between net earnings and adjusted net earnings1 for the current and previous periods.

Factors affecting Operating Cash Flow and Free Cash Flow1 - three months ended September 30, 2023 versus June 30, 2023

In the three months ended September 30, 2023, we generated $1,127 million in operating cash flow, compared to $832 million in the prior quarter. The increase of $295 million was primarily due to a decrease in cash taxes paid and lower interest paid as a result of the timing of semi-annual interest payments on our bonds, which occur in Q2 and Q4. Operating cash flow was further impacted by lower total cash costs/C1 cash costs per ounce/pound1, higher gold sales volume and an increase in the realized copper price1, partially offset by a lower realized gold price1.

For the three months ended September 30, 2023, we recorded free cash flow1 of $359 million, compared to $63 million in the prior quarter, mainly reflecting higher operating cash flows as explained above, while capital expenditures remained in line with the prior quarter. In the third quarter of 2023, capital expenditures on a cash basis were $768 million compared to $769 million in the prior quarter, as a slight decrease in project capital expenditures1, was largely offset by a slight increase in minesite sustaining capital expenditures1. The decrease in project capital expenditures1 was mainly at Pueblo Viejo as the plant expansion nears completion and at Lumwana due to the timing of deliveries of the remaining new owner mining truck fleet to replace the contract mining. This was

partially offset by higher project capital expenditures1 at Loulo-Gounkoto due to the Yalea South project. Minesite sustaining capital expenditures1 increased primarily driven by increased capitalized waste stripping at Lumwana and Carlin, partially offset by lower capitalized waste stripping at Loulo-Gounkoto.

Factors affecting Operating Cash Flow and Free Cash Flow1 - three months ended September 30, 2023 versus September 30, 2022

In the third quarter of 2023, we generated $1,127 million in operating cash flow, compared to $758 million in the same prior year period. The increase of $369 million was primarily due to higher realized gold and copper prices1, combined with higher gold sales volumes. This was partially offset by higher gold and copper total cash costs/C1 cash costs per ounce/pound1. Operating cash flow was also positively impacted by lower cash taxes paid and higher interest income received as a result of an increase in market interest rates.

In the third quarter of 2023, we generated free cash flow1 of $359 million compared to negative free cash flow1 of $34 million in the same prior year period. The increase primarily reflects higher operating cash flows as explained above and to a lesser extent slightly lower capital expenditures. In the third quarter of 2023, capital expenditures on a cash basis were $768 million compared to $792 million in the third quarter of 2022. The decrease in capital expenditures of $24 million was due to a decrease in minesite sustaining capital expenditures1, partially offset by an increase in project capital expenditures1. Minesite sustaining capital expenditures1 decreased compared to the same prior year period, mainly due to lower capitalized waste stripping at Cortez and an improvement in mining unit rates at Lumwana, partially offset by higher capitalized waste stripping and underground development at Carlin. The increase in project capital expenditures1 is primarily due to higher expenditures at the TS Solar project at NGM as construction began in the fourth quarter of 2022, combined with the investment in the new owner mining truck fleet at Lumwana. This was partially offset by lower project spend at Pueblo Viejo as the plant expansion nears completion.

Factors affecting Operating Cash Flow and Free Cash Flow1 - nine months ended September 30, 2023 versus September 30, 2022

For the nine months ended September 30, 2023, we generated $2,735 million in operating cash flow, compared to $2,686 million in the same prior year period. The increase of $49 million was primarily due to lower cash taxes paid and an increase in interest income received as a result of higher market interest rates. Operating cash flow was negatively impacted by higher total cash costs/C1 cash costs per ounce/pound1 and lower gold and copper sales volumes, partially offset by a higher realized gold price1. This was combined with an unfavorable movement in working capital, mainly in accounts receivable and accounts payable, partially offset by a favorable movement in other current assets.

For the nine months ended September 30, 2023, we generated free cash flow1 of $510 million compared to $528 million in the same prior year period. The decrease of $18 million primarily reflects higher capital expenditures, partially offset by higher operating cash flows as explained above. In the nine months ended September 30, 2023, capital expenditures on a cash basis were $2,225 million

 

 

 

 

BARRICK THIRD QUARTER 2023    8    MANAGEMENT’S DISCUSSION AND ANALYSIS


OVERVIEW  

OPERATING

PERFORMANCE

 

 

GROWTH PROJECTS &

EXPLORATION

 

 

REVIEW OF FINANCIAL

RESULTS

 

 

OTHER INFORMATION & 

NON-GAAP 

RECONCILIATIONS 

 

FINANCIAL

STATEMENTS

 

compared to $2,158 million in the same prior year period resulting from an increase in project capital expenditures1, partially offset by a decrease in minesite sustaining capital expenditures1. The increase in project capital expenditures1 was primarily the result of the investment in the new owner mining truck fleet at Lumwana, combined with higher expenditures at the TS Solar project at NGM as construction began in the fourth quarter of 2022. This was partially offset by lower project spend incurred on the plant expansion at Pueblo Viejo. Lower minesite sustaining capital expenditures1 is mainly due to lower capitalized waste stripping at Cortez and Lumwana was largely offset by an increase in project spend on processing facilities and underground development at Carlin, higher capitalized waste stripping at North Mara, and increased expenditures on the tailings buttress project and new equipment purchases in the underground at Loulo-Gounkoto.

Key Business Developments

Share Buyback Program

At the February 14, 2023 meeting, the Board of Directors authorized a new share buyback program for the purchase of up to $1 billion of Barrick’s outstanding shares over the next 12 months. As at September 30, 2023, we have not purchased any shares under this program in 2023.

The actual number of common shares that may be purchased, and the timing of any such purchases, will be determined by Barrick based on a number of factors, including the Company’s financial performance, the availability of cash flows, and the consideration of other uses of cash, including capital investment opportunities, returns to shareholders, and debt reduction.

The repurchase program does not obligate the Company to acquire any particular number of common shares, and the repurchase program may be suspended or discontinued at any time at the Company’s discretion.

Porgera Special Mining Lease

On April 9, 2021, BNL signed a binding Framework Agreement with the Independent State of PNG and Kumul Minerals, a state-owned mining company, setting out the terms and conditions for the reopening of the Porgera mine. On February 3, 2022, the Framework Agreement was replaced by the Commencement Agreement signed by PNG, Kumul Minerals, BNL, Porgera (Jersey) Limited, an affiliate of BNL, and MRE, the holder of the remaining 5% of the original Porgera joint venture. The Commencement Agreement reflects the commercial terms previously agreed to under the Framework Agreement, namely that PNG stakeholders will receive a 51% equity stake in the Porgera mine, with the remaining 49% to be held by BNL or an affiliate. BNL is jointly owned on a 50/50 basis by Barrick and Zijin Mining Group. The Commencement Agreement also provides that PNG stakeholders and BNL and its affiliates will share the economic benefits derived from the reopened Porgera mine on a 53% and 47% basis over the remaining life of mine, respectively, and that the Government of PNG will retain the option to acquire BNL’s or its affiliate’s 49% equity participation at fair market value after 10 years.

On April 21, 2022, the PNG National Parliament passed legislation to provide, among other things, certain agreed tax exemptions and tax stability for the new Porgera joint venture. This legislation was certified on May 30, 2022. Six out of the seven pieces of legislation took effect as of

April 11 and 14, 2023, respectively, when they were published in the National Gazette, as required under PNG Law. The remaining act awaits publication to take effect.

On September 13, 2022, the Shareholders’ Agreement for the new Porgera joint venture company was executed by Porgera (Jersey) Limited, the state-owned Kumul Minerals (Porgera) Limited and MRE. New Porgera Limited, the new Porgera joint venture company, was incorporated on September 22, 2022 and became a party to the Commencement Agreement and the Shareholders’ Agreement on October 13, 2023.

On March 31, 2023, BNL, the Independent State of PNG and New Porgera Limited signed the New Porgera Progress Agreement whereby the parties reiterated their commitment to reopening the Porgera mine in line with the terms of the Commencement Agreement and the Shareholders’ Agreement. The provisions of the Commencement Agreement will be fully implemented, and work to recommence full mine operations at Porgera will begin, following the satisfaction of a number of conditions. Under the terms of the Commencement Agreement, BNL will remain in possession of the site and maintain the mine on care and maintenance.

New Porgera Limited lodged an application with the Mineral Resources Authority for a new SML on June 13, 2023, in accordance with the Commencement Agreement.

On June 20, 2023, the PNG IRC, the Commissioner General, Barrick and BNL entered into a settlement agreement to resolve a dispute regarding tax assessments issued by the IRC against BNL. The resolution of this tax dispute satisfied one of the conditions to the reopening of the Porgera mine under the Commencement Agreement.

On October 13, 2023, the Independent State of PNG granted the new SML, Special Mining Lease 13, to New Porgera Limited, following the execution of the Mining Development Contract by the Independent State of PNG and New Porgera Limited. The granting of the new SML to New Porgera Limited reduced Barrick’s interest in the future production of the Porgera mine from 47.5% to 24.5%. Also on October 13, 2023, the Independent State of PNG and New Porgera Limited executed the Fiscal Stability Agreement for the Porgera mine and New Porgera Limited and BNL executed the Project Operatorship Agreement, pursuant to which BNL was appointed as operator of the Porgera mine.

The parties to the Commencement Agreement are continuing to progress the remaining conditions for the reopening of the mine. The key remaining condition to restart is the execution of new compensation agreements with local landowners.

Our 2023 gold guidance continues to exclude Porgera, pending the execution of landowner compensation agreements and the finalization of a timeline for the resumption of full mine operations. Refer to notes 12 and 16 to the Financial Statements for more information.

 

 

 

 

BARRICK THIRD QUARTER 2023    9    MANAGEMENT’S DISCUSSION AND ANALYSIS


OVERVIEW  

OPERATING

PERFORMANCE

 

 

GROWTH PROJECTS &

EXPLORATION

 

 

REVIEW OF FINANCIAL

RESULTS

 

 

OTHER INFORMATION & 

NON-GAAP 

RECONCILIATIONS 

 

FINANCIAL

STATEMENTS

 

Environmental, Social and Governance (“ESG”)

Sustainability is entrenched in our DNA: our sustainability strategy is our business plan.

Barrick’s vision to sustainability is underpinned by the knowledge that sustainability aspects are interconnected and must be tackled in conjunction with, and reference to, each other. We call this approach Holistic and Integrated Sustainability Management. Although we integrate our sustainability management, we discuss our sustainability strategy within four overarching pillars: (1) respecting human rights; (2) protecting the health and safety of our people and local communities; (3) sharing the benefits of our operations; and (4) managing our impacts on the environment.

We implement this strategy by blending top-down accountability with bottom-up responsibility. This means we place the day-to-day ownership of sustainability, and the associated risks and opportunities, in the hands of individual sites. In the same way that each site must manage its geological, operational and technical capabilities to meet business objectives, it must also manage and identify programs, metrics, and targets that measure progress and deliver real value for the business and our stakeholders, including our host countries and local communities. The Group Sustainability Executive, supported by regional sustainability leads, provides oversight and direction over this site-level ownership, to ensure alignment with the strategic priorities of the overall business.

Governance

The bedrock of our sustainability strategy is strong governance. Our most senior management-level body dedicated to sustainability is the E&S Committee, which connects site-level ownership of our sustainability strategy with the leadership of the Group. It is chaired by the President and Chief Executive Officer and includes: (1) regional Chief Operating Officers; (2) minesite General Managers; (3) Health, Safety, Environment and Closure Leads; (4) the Group Sustainability Executive; (5) in-house legal counsel; and (6) an independent sustainability consultant in an advisory role. The E&S Committee meets on a quarterly basis to review our performance across a range of key performance indicators, and to provide independent oversight and review of sustainability management.

The President and Chief Executive Officer reviews the reports of the E&S Committee at every quarterly meeting of the Board’s ESG & Nominating Committee. The reports are reviewed to ensure the implementation of our sustainability policies and to drive performance of our environmental, health and safety, community relations and development, and human rights programs.

This is supplemented by weekly meetings, at a minimum, between the Regional Sustainability Leads and the Group Sustainability Executive. These meetings examine the sustainability-related risks and opportunities facing the business in real time, as well as the progress and issues integrated into weekly Executive Committee review meetings.

Our industry-first Sustainability Scorecard accounts for 25% of the long-term incentive awards for senior leaders as part of the Barrick Partnership Plan. As we strive for ongoing strong performance, the Sustainability Scorecard targets and metrics are updated annually. The results of the 2022 Sustainability Scorecard, and updated metrics and targets for 2023, were disclosed in our 2022

Sustainability Report, published in April 2023. The E&S Committee tracks our progress against all metrics.

Human rights

Our commitment to respect human rights is codified in our standalone Human Rights Policy and informed by the expectations of the United Nations Guiding Principles on Business and Human Rights, the Voluntary Principles on Security and Human Rights and the OECD Guidelines for Multinational Enterprises. This commitment is fulfilled on the ground via our Human Rights Program, the fundamental principles of which include: monitoring and reporting, due diligence, training, as well as disciplinary action and remedy.

We continue to assess and manage security and human rights risks at all our operations and provide security and human rights training to private and public security forces across our sites.

Safety

We are committed to the safety, health and well-being of our people, their families and the communities in which we operate. Our safety vision is “Everyone to go home safe and healthy every day.”

Regrettably, in September 2023 we had two unfortunate incidents: one at Loulo-Gounkoto in Mali, which resulted in the fatality of an employee; and a second fatal incident of an exploration contractor at NGM.

Our focus and priority continues to be on the roll out of our “Journey to Zero” initiative, which was developed in the first quarter of 2023. This last quarter has seen the update of our 10 Fatal Risks Standards, as well as the roll out of the Field Level Risk Assessment.

We report our safety performance quarterly as part of both our E&S Committee meetings and our reports to the ESG & Nominating Committee. Our safety performance is a regular standing agenda item on our weekly Executive Committee review meeting.

In terms of other key performance indicators, for the third quarter of 2023, our LTIFR3 was 0.29, an 11% increase quarter on quarter, and our TRIFR3 was 1.28, an increase of 27% from the second quarter.

Social

We regard our host communities and countries as important partners in our business. Our sustainability policies commit us to transparency in our relationships with host communities, government authorities, the public and other key stakeholders. Through these policies, we commit to conducting our business with integrity and with absolute opposition to corruption. We require our suppliers to operate ethically and responsibly as a condition of doing business with us.

Community and economic development

Our commitment to social and economic development is set out in our overarching Sustainable Development and Social Performance policies. Mining has been identified as vital for the achievement of the United Nations SDGs, not only for its role in providing the minerals needed to enable the transition to a lower carbon intensive economy, but more importantly because of its ability to drive socio-economic development and build resilience. Creating long-term value and sharing economic benefits is at the heart of our approach to sustainability, as well as community development. This approach is encapsulated in three concepts:

 

 

 

 

BARRICK THIRD QUARTER 2023    10    MANAGEMENT’S DISCUSSION AND ANALYSIS


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GROWTH PROJECTS &

EXPLORATION

 

 

REVIEW OF FINANCIAL

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FINANCIAL

STATEMENTS

 

The primacy of partnership: this means that we invest in real partnerships with mutual responsibility. Partnerships include local communities, suppliers, government, and organizations, and this approach is epitomized through our CDCs with development initiatives and investments.

Sharing the benefits: We hire and buy local wherever possible as this injects money into and keeps it in our local communities and host countries. By doing this, we build capacity, community resilience and create opportunity. We also invest in community development through our CDCs. Sharing the benefits also means paying our fair share of taxes, royalties and dividends and doing so transparently, primarily through the reporting mechanism of the Canadian Extractive Sector Transparency Measures Act. Our annual Tax Contribution Report sets out, in detail, our economic contributions to host governments.

Engaging and listening to stakeholders: We develop tailored stakeholder engagement plans for every operation and the business as a whole. These plans guide and document how often we engage with various stakeholder groups and allow us to proactively deal with issues before they escalate into significant risks.

Our community development spend during the third quarter was $10 million, and $27 million in the year to date.

Environment

We know the environment in which we work and our host communities are inextricably linked, and we apply a holistic and integrated approach to sustainability management. Being responsible stewards of the environment by applying the highest standards of environmental management, using natural resources and energy efficiently, recycling and reducing waste as well as working to protect biodiversity, we can deliver significant cost savings to our business, reduce future liabilities and help build stronger stakeholder relationships. Environmental matters such as how we use water, prevent incidents, manage tailings, respond to changing climate, and protect biodiversity are key areas of focus.

We maintained our strong track record of stewardship and did not record any Class 14 environmental incidents during the quarter or for 2023 year to date.

Climate Change

The ESG & Nominating Committee is responsible for overseeing Barrick’s policies, programs and performance relating to sustainability and the environment, including climate change. The Audit & Risk Committee assists the Board in overseeing the Group’s management of enterprise risks as well as the implementation of policies and standards for monitoring and mitigating such risks. Climate change is built into our formal risk management process, outputs of which are regularly reviewed by the Audit & Risk Committee.

Barrick’s climate change strategy has three pillars: (1) identify, understand and mitigate the risks associated with climate change; (2) measure and reduce our GHG emissions across our operations and value chain; and (3) improve our disclosure on climate change. The three pillars of our climate change strategy do not focus solely on the development of emissions reduction targets, rather, we integrate and consider aspects of biodiversity protection, water management and community resilience in our approach.

We are acutely aware of the impacts that climate change and extreme weather events have on our host

communities and countries, particularly developing nations which are often the most vulnerable. As the world economy transitions to renewable power, it is imperative that developing nations are not left behind. As a responsible business, we have focused our efforts on building resilience in our host communities and countries, just as we do for our business. Our climate disclosure is based on the recommendations of the TCFD.

Identify, understand and mitigate the risks associated with climate change

We identify and manage risks, build resilience to a changing climate and extreme weather events, as well as position ourselves for new opportunities. These factors continue to be incorporated into our formal risk assessment process. We have identified several risks and opportunities for our business including: physical impacts of extreme weather events; an increase in regulations that seek to address climate change; and an increase in global investment in innovation and low-carbon technologies.

The risk assessment process includes scenario analysis, which is being rolled out to all sites with an initial focus on our Tier One Gold Assets5, to assess site-specific climate related risks and opportunities. The key findings and a summary of this asset-level physical and transitional risk assessment at Loulo-Gounkoto and Kibali were disclosed as part of our CDP (formerly known as the Carbon Disclosure Project) Climate Change and Water Security questionnaires, submitted to CDP in July 2023.

In addition, climate scenario analysis and risk assessments were completed for Carlin (physical risks) and NGM (transitional risks). These disclosures will be included in the 2023 Sustainability Report to be published in 2024.

Measure and reduce the Group’s impact on climate change

Mining is an energy-intensive business, and we understand the important link between energy use and GHG emissions. By measuring and effectively managing our energy use, we can reduce our GHG emissions, achieve more efficient production, and reduce our costs.

We have climate champions at each site who are tasked with identifying roadmaps and assessing feasibility for our GHG emissions reductions and carbon offsets for hard-to-abate emissions. Any carbon offsets that we pursue must have appropriate socio-economic and/or biodiversity benefits. We have published an achievable emissions reduction roadmap and continue to assess further reduction opportunities across our operations. The detailed roadmap was first published in our 2021 Sustainability Report and includes committed-capital projects and projects under investigation that rely on technological advances, with a progress summary contained in the 2022 Sustainability Report.

We continue to progress our extensive work across our value chain in understanding our Scope 3 (indirect emissions associated with the value chain) emissions and implementing our engagement roadmap to enable our key suppliers to set meaningful and measurable reduction targets, in line with the commitments made through the ICMM Climate Position Paper.

In November 2023, Barrick announced its Scope 3 emissions targets which it developed to promote awareness and action in its value chain and empower those actors to set their own net zero commitments, with short and medium-term targets. These targets are both quantitative and qualitative and are focused on high emission areas in our value chain as outlined below:

 

 

 

 

BARRICK THIRD QUARTER 2023    11    MANAGEMENT’S DISCUSSION AND ANALYSIS


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EXPLORATION

 

 

REVIEW OF FINANCIAL

RESULTS

 

 

OTHER INFORMATION & 

NON-GAAP 

RECONCILIATIONS 

 

FINANCIAL

STATEMENTS

 

Goods and Suppliers (Category 16):

 

Quantitative Target: 30% emissions reduction of “Tier 1” suppliers (those suppliers that collectively account for 5% of Barrick’s total spend in this category) by 2030 against a 2022 Scope 3 base year;

 

Qualitative Target: Incorporate 130 of our largest suppliers by spend into our annual outreach (this includes our Tier 1 suppliers as well as chemical and metal fabricator suppliers) and engagement;

 

2025 Target: Collect high-quality data for 50% of Tier 1 and chemical and metal fabricator suppliers through engagement, and refine emissions reduction targets by 2025.

Fuels and Energy (Category 36):

 

Quantitative Target: 20% reduction against a 2022 Scope 3 base year by 2030;

 

Qualitative Targets:

   

Collaborate towards new technologies to reduce fleet emissions; and

   

Engage with host governments where we consume power from national grids for continued renewable energy incorporation.

Downstream Copper Processing (Category 106):

 

Qualitative Target: Outreach and engagement of all downstream customers and smelters;

 

2025 Target: Set emissions reduction target, covering 75% of copper processing, by 2025.

Improve our disclosure on climate change

Our disclosure on climate change, including in our Sustainability Report and on our website, is developed in line with the TCFD recommendations. Barrick continues to monitor the various regulatory climate disclosure standards being developed around the world, including the ISSB’s recently issued S2 Climate-related Disclosures. In addition, we complete the annual CDP Climate Change and Water Security questionnaires. This ensures our investor-relevant water use, emissions and climate data is widely available.

Emissions

Barrick’s interim GHG emissions reduction target is for a minimum 30% reduction by 2030 against our 2018 baseline, while maintaining a steady production profile. The basis of this reduction is against a 2018 baseline of 7,541 kt CO2-e.

Our GHG emissions reduction target is grounded in science and has a detailed pathway for achievement. Our target is not static and will be updated as we continue to identify and implement new GHG reduction opportunities.

Ultimately, our vision is net zero GHG emissions by 2050, achieved primarily through GHG reductions, with some offsets for hard-to-abate emissions. Site-level plans to improve energy efficiency, integrate clean and renewable energy sources and reduce GHG emissions will also be strengthened. We plan to supplement our corporate emissions reduction target with context-based site-specific emissions reduction targets.

During the third quarter of 2023, the Group’s total Scope 1 and 2 (location-based) GHG emissions were 1,789 kt CO2-e. Year to date emissions are approximately 6% less than the GHG emissions for the same period year to date in 2022.

Water

Water is a vital and increasingly scarce global resource. Managing and using water responsibly is one of the most critical parts of our sustainability strategy. Our commitment to responsible water use is codified in our Environmental Policy. Steady, reliable access to water is critical to the effective operation of our mines. Access to water is also a fundamental human right.

Understanding the water stress in the regions we operate enables us to better understand the risks and manage our water resources through site-specific water balances, based on the ICMM Water Accounting Framework, aimed at minimizing our water withdrawal and maximizing water reuse and recycling within our operations.

We include each mine’s water risks in its operational risk register. These risks are then aggregated and incorporated into the corporate risk register. Our identified water-related risks include: (1) managing excess water in regions with high rainfall; (2) maintaining access to water in arid areas and regions prone to water scarcity; and (3) regulatory risks related to permitting limits as well as municipal and national regulations for water use.

We set an annual water recycling and reuse target of 80%. Our water recycling and reuse rate for the third quarter of 2023 was approximately 85%. The increase was due to refinement of the Pueblo Viejo water balance accounting and thus the performance for the same period in 2022 is not directly comparable.

Tailings

We are committed to having our TSFs meet global best practices for safety. Our TSFs are carefully engineered and regularly inspected, particularly those in regions with high rainfall and seismic events.

We disclosed our conformance to the GISTM for all Extreme and Very High consequence facilities on the Barrick website on August 4, 2023, within the committed disclosure timeframe. All of our sites that are classified as Very High or Extreme consequence are in conformance with the GISTM. We continue to progress with our conformance for lower consequence facilities in accordance with the GISTM. Disclosures for lower consequence facilities will be completed by August 2025, also in accordance with the GISTM.

Biodiversity

Biodiversity underpins many of the ecosystem services on which our mines and their surrounding communities depend. If improperly managed, mining and exploration activities have the potential to negatively affect biodiversity and ecosystem services. Protecting biodiversity and preventing nature loss is also critical and inextricably linked to the fight against climate change. We work to proactively manage our impact on biodiversity and strive to protect the ecosystems in which we operate. Wherever possible, we aim to achieve a net neutral biodiversity impact, particularly for ecologically sensitive environments.

We continue to work to implement our BAPs. The BAPs outline our strategy to achieve net-neutral impacts for all key biodiversity features and their associated management plans.

 

 

 

 

BARRICK THIRD QUARTER 2023    12    MANAGEMENT’S DISCUSSION AND ANALYSIS


OVERVIEW  

OPERATING

PERFORMANCE

 

 

GROWTH PROJECTS &

EXPLORATION

 

 

REVIEW OF FINANCIAL

RESULTS

 

 

OTHER INFORMATION & 

NON-GAAP 

RECONCILIATIONS 

 

FINANCIAL

STATEMENTS

 

Full Year 2023 Outlook

We expect our 2023 gold production to be marginally below the low end of the 4.2 to 4.6 million ounce guidance range that we announced at the start of 2023. We continue to hold ourselves accountable to deliver to the initial commitment and are exploring short-term options to narrow the gap. The deviation from plan was primarily due to equipment issues hindering the ramp-up at Pueblo Viejo. Additionally, Cortez and Carlin are now anticipated to be slightly below their production guidance for the year. We continue to expect a significant increase in the Group’s fourth quarter production volume, with the full year expected to be within 3% of the low end of the range.

At Pueblo Viejo, the plant expansion ramp-up during the third quarter was impacted by equipment failures primarily at the newly installed flotation circuit. Together with the original equipment manufacturer, we have identified the root cause of these failures and the rectification work is underway. We also experienced a further setback early in the fourth quarter with the structural failure of the crusher conveyor. We now expect to reach nameplate capacity for the expanded plant during the first quarter of 2024.

At Nevada Gold Mines, Cortez’s production was primarily impacted by lower than forecasted oxide grades out of Crossroads and a slower than expected ramp-up at Goldrush. At Carlin, production was impacted by slower mining rates in the Gold Quarry pit as well as unplanned downtime at the Goldstrike autoclave in the third quarter, which is also expected to impact the fourth quarter.

Aside from the three aforementioned sites, all other sites are expected to deliver within guidance. Notably, Veladero is now expected to exceed the top end of its 2023 production guidance range.

Our 2023 gold guidance continues to exclude Porgera, pending the execution of landowner compensation agreements and the finalization of a timeline for the resumption of full mine operations which is expected by the end of 2023.

Our 2023 gold cost guidance has been impacted by lower production volumes and we now expect to be slightly above the initial ranges we provided after allowing for the higher gold price impact. These cost guidance ranges were based on a gold price assumption of $1,650 per ounce. We have previously disclosed a sensitivity of approximately $5 per ounce on our 2023 gold cost guidance metrics for every $100 per ounce change in the gold price and based on the realized gold price for the nine months to September 30, 2023, the impact of the higher gold price flowing into higher royalty costs has been approximately $15/oz.

We continue to expect 2023 copper production to be in the range of 420 to 470 million pounds. Production in the final quarter of 2023 is expected to be stronger than the previous three quarters, mainly due to steadily increasing throughput at Lumwana as we execute on our owner-miner strategy and continue to see the benefit of ramping up the new mining fleet. We expect that we will deliver on our group copper cost guidance metrics for 2023 which are based on a copper price assumption of $3.50 per pound.

With respect to our attributable capital expenditures, we expect the full year outcome to be around the midpoint of the guidance range of $2.2-2.6 billion.

Further detail on our 2023 company guidance is provided below, inclusive of the key assumptions that were used as the basis for this guidance as released on February 15, 2023 and as qualified by the risks and uncertainties discussed above.

 Company Guidance

     2023  

 ($ millions, except per ounce/pound data)

     Estimate  

Gold production (millions of ounces)

     4.20 - 4.60  

Gold cost metrics

  

Cost of sales - gold ($/oz)

     1,170 - 1,250  

Total cash costs ($/oz)a

     820 - 880  

Depreciation ($/oz)

     320 - 350  

All-in sustaining costs ($/oz)a

     1,170 - 1,250  

Copper production (millions of pounds)

     420 - 470  

Copper cost metrics

  

Cost of sales - copper ($/lb)

     2.60 - 2.90  

C1 cash costs ($/lb)a

     2.05 - 2.25  

Depreciation ($/lb)

     0.80 - 0.90  

All-in sustaining costs ($/lb)a

     2.95 - 3.25  

Exploration and project expenses

     400 - 440  

Exploration and evaluation

     180 - 200  

Project expenses

     220 - 240  

General and administrative expenses

     ~180  

Corporate administration

     ~130  

Share-based compensationb

     ~50  

Other expense

     70 - 90  

Finance costs, net

     280 - 320  

Attributable capital expenditures:

  

Attributable minesite sustaininga

     1,450 - 1,700  

Attributable projecta

     750 - 900  

 Total attributable capital expenditures

     2,200 - 2,600  

 Effective income tax ratec

     27% - 32%  

Key assumptions (used for guidance)

  

Gold Price ($/oz)

     1,650  

Copper Price ($/lb)

     3.50  

Oil Price (WTI) ($/barrel)

     90  

AUD Exchange Rate (AUD:USD)

     0.75  

ARS Exchange Rate (USD:ARS)

     170  

CAD Exchange Rate (USD:CAD)

     1.30  

CLP Exchange Rate (USD:CLP)

     900  

EUR Exchange Rate (EUR:USD)

     1.20  

 

a.

Further information on these non-GAAP financial measures, including detailed reconciliations, is included on pages 59 to 76 of this MD&A.

b.

Based on a one-month trailing average ending December 31, 2022 of US$17.04 per share.

c.

Based on key assumptions included in this table.

 

 

 

 

BARRICK THIRD QUARTER 2023    13    MANAGEMENT’S DISCUSSION AND ANALYSIS


OVERVIEW  

OPERATING

PERFORMANCE

 

 

GROWTH PROJECTS &

EXPLORATION

 

 

REVIEW OF FINANCIAL

RESULTS

 

 

OTHER INFORMATION & 

NON-GAAP 

RECONCILIATIONS 

 

FINANCIAL

STATEMENTS

 

Operating Division Guidance

Our 2023 forecast gold and copper production, cost of salesa, total cash costsb, all-in sustaining costsb, and C1 cash costsb ranges by operating division are as follows:

 

 Operating Division    2023 forecast attributable
production (000s ozs)
     2023 forecast cost of
salesa ($/oz)
     2023 forecast total cash
costsb ($/oz)
     2023 forecast all-in
sustaining costs($/oz)
 
 Gold            

Carlin (61.5%)

     910 - 1,000        1,030 - 1,110        820 - 880        1,250 - 1,330  

Cortez (61.5%)c

     580 - 650        1,080 - 1,160        680 - 740        930 - 1,010  

Turquoise Ridge (61.5%)

     300 - 340        1,290 - 1,370        900 - 960        1,170 - 1,250  

Phoenix (61.5%)

     100 - 120        1,860 - 1,940        880 - 940        1,110 - 1,190  

Long Canyon (61.5%)

     0 - 10        2,120 - 2,200        730 - 790        1,080 - 1,160  

Nevada Gold Mines (61.5%)

     1,900 - 2,100        1,140 - 1,220        790 - 850        1,140 - 1,220  

Hemlo

     150 - 170        1,400 - 1,480        1,210 - 1,270        1,590 - 1,670  

North America

     2,100 - 2,300        1,160 - 1,240        820 - 880        1,170 - 1,250  

Pueblo Viejo (60%)

     470 - 520        1,130 - 1,210        710 - 770        960 - 1,040  

Veladero (50%)

     160 - 180        1,630 - 1,710        1,060 - 1,120        1,550 - 1,630  

Porgera (47.5%)d

                           

Latin America & Asia Pacific

     630 - 700        1,260 - 1,340        800 - 860        1,110 - 1,190  

Loulo-Gounkoto (80%)

     510 - 560        1,100 - 1,180        750 - 810        1,070 - 1,150  

Kibali (45%)

     320 - 360        1,080 - 1,160        710 - 770        880 - 960  

North Mara (84%)

     230 - 260        1,120 - 1,200        900 - 960        1,240 - 1,320  

Bulyanhulu (84%)

     160 - 190        1,230 - 1,310        880 - 940        1,160 - 1,240  

Tongon (89.7%)

     180 - 210        1,260 - 1,340        1,070 - 1,130        1,240 - 1,320  

Africa & Middle East

     1,450 - 1,600        1,130 - 1,210        820 - 880        1,080 - 1,160  

                                   
 Total Attributable to Barricke,f,g      4,200 - 4,600        1,170 - 1,250        820 - 880        1,170 - 1,250  
      2023 forecast attributable
production (M lbs)
     2023 forecast cost of
salesa ($/lb)
     2023 forecast C1 cash
costsb ($/lb)
     2023 forecast all-in
sustaining costs($/lb)
 
 Copper            

Lumwana

     260 - 290        2.45 - 2.75        2.00 - 2.20        3.20 - 3.50  

Zaldívar (50%)

     100 - 110        3.40 - 3.70        2.60 - 2.80        2.90 - 3.20  

Jabal Sayid (50%)

     65 - 75        1.80 - 2.10        1.50 - 1.70        1.60 - 1.90  
 Total Copperg      420 - 470        2.60 - 2.90        2.05 - 2.25        2.95 - 3.25  

 

  a.

Gold cost of sales per ounce is calculated as cost of sales across our gold operations (excluding sites in closure or care and maintenance) divided by ounces sold (both on an attributable basis using Barrick’s ownership share). Copper cost of sales per pound is calculated as cost of sales across our copper operations divided by pounds sold (both on an attributable basis using Barrick’s ownership share).

  b.

Further information on these non-GAAP financial measures, including detailed reconciliations, is included on pages 59 to 76 of this MD&A.

  c.

Includes Goldrush.

  d.

Porgera was placed on temporary care and maintenance on April 25, 2020 and remains excluded from our 2023 guidance. We expect to update our guidance to include Porgera following both the execution of landowner compensation agreements and the finalization of a timeline for the resumption of full mine operations. The granting of the new SML to New Porgera Limited reduced Barrick’s interest in the future production of the Porgera mine from 47.5% to 24.5%. Refer to page 9 for further details.

  e.

Total cash costs and all-in sustaining costs per ounce include costs allocated to non-operating sites.

  f.

Operating division guidance ranges reflect expectations at each individual operating division and may not add up to the company-wide guidance range total. Guidance ranges exclude Pierina which is producing incidental ounces while in closure.

  g.

Includes corporate administration costs.

 

 

 

BARRICK THIRD QUARTER 2023    14    MANAGEMENT’S DISCUSSION AND ANALYSIS


OVERVIEW  

OPERATING

PERFORMANCE

 

 

GROWTH PROJECTS &

EXPLORATION

 

 

REVIEW OF FINANCIAL

RESULTS

 

 

OTHER INFORMATION & 

NON-GAAP 

RECONCILIATIONS 

 

FINANCIAL

STATEMENTS

 

Production and Cost Summary - Gold

 

     

 

For the three months ended

       9/30/23        6/30/23       % Change        9/30/22       % Change

Nevada Gold Mines LLC (61.5%)a

              

Gold produced (000s oz)

     478        458      4 %      425      12 %

Cost of sales ($/oz)

     1,273        1,357      (6)%      1,242      2 %

Total cash costs ($/oz)b

     921        1,009      (9)%      924      0 %

All-in sustaining costs ($/oz)b

     1,286        1,388      (7)%      1,333      (4)%

Carlin (61.5%)

              

Gold produced (000s oz)

     230        248      (7)%      229      0 %

Cost of sales ($/oz)

     1,166        1,240      (6)%      1,137      3 %

Total cash costs ($/oz)b

     953        1,013      (6)%      943      1 %

All-in sustaining costs ($/oz)b

     1,409        1,407      0 %      1,304      8 %

Cortez (61.5%)c

              

Gold produced (000s oz)

     137        110      25 %      98      40 %

Cost of sales ($/oz)

     1,246        1,346      (7)%      1,056      18 %

Total cash costs ($/oz)b

     840        972      (14)%      770      9 %

All-in sustaining costs ($/oz)b

     1,156        1,453      (20)%      1,426      (19)%

Turquoise Ridge (61.5%)

              

Gold produced (000s oz)

     83        68      22 %      62      34 %

Cost of sales ($/oz)

     1,300        1,466      (11)%      1,509      (14)%

Total cash costs ($/oz)b

     938        1,088      (14)%      1,105      (15)%

All-in sustaining costs ($/oz)b

     1,106        1,302      (15)%      1,423      (22)%

Phoenix (61.5%)

              

Gold produced (000s oz)

     26        29      (10)%      30      (13)%

Cost of sales ($/oz)

     2,235        2,075      8 %      1,964      14 %

Total cash costs ($/oz)b

     1,003        948      6 %      953      5 %

All-in sustaining costs ($/oz)b

     1,264        1,132      12 %      1,084      17 %

Long Canyon (61.5%)

              

Gold produced (000s oz)

     2        3      (33)%      6      (67)%

Cost of sales ($/oz)

     1,832        1,640      12 %      1,769      4 %

Total cash costs ($/oz)b

     778        637      22 %      662      18 %

All-in sustaining costs ($/oz)b

     831        677      23 %      684      21 %

Pueblo Viejo (60%)

              

Gold produced (000s oz)

     79        77      3 %      121      (35)%

Cost of sales ($/oz)

     1,501        1,344      12 %      1,097      37 %

Total cash costs ($/oz)b

     935        840      11 %      733      28 %

All-in sustaining costs ($/oz)b

     1,280        1,219      5 %      1,063      20 %

Loulo-Gounkoto (80%)

              

Gold produced (000s oz)

     142        141      1 %      130      9 %

Cost of sales ($/oz)

     1,087        1,150      (5)%      1,220      (11)%

Total cash costs ($/oz)b

     773        801      (3)%      845      (9)%

All-in sustaining costs ($/oz)b

     1,068        1,245      (14)%      1,216      (12)%

Kibali (45%)

              

Gold produced (000s oz)

     99        87      14 %      83      19 %

Cost of sales ($/oz)

     1,152        1,269      (9)%      1,047      10 %

Total cash costs ($/oz)b

     694        797      (13)%      731      (5)%

All-in sustaining costs ($/oz)b

     801        955      (16)%      876      (9)%

Veladero (50%)

              

Gold produced (000s oz)

     55        54      2 %      41      34 %

Cost of sales ($/oz)

     1,376        1,424      (3)%      1,430      (4)%

Total cash costs ($/oz)b

     988        999      (1)%      893      11%

All-in sustaining costs ($/oz)b

     1,314        1,599      (18)%      1,570      (16)%

Porgera (47.5%)d

              

Gold produced (000s oz)

                 — %           — %

Cost of sales ($/oz)

                 — %           — %

Total cash costs ($/oz)b

                 — %           — %

All-in sustaining costs ($/oz)b

                 — %           — %

 

 

 

BARRICK THIRD QUARTER 2023    15    MANAGEMENT’S DISCUSSION AND ANALYSIS


OVERVIEW  

OPERATING

PERFORMANCE

 

 

GROWTH PROJECTS &

EXPLORATION

 

 

REVIEW OF FINANCIAL

RESULTS

 

 

OTHER INFORMATION & 

NON-GAAP 

RECONCILIATIONS 

 

FINANCIAL

STATEMENTS

 

Production and Cost Summary - Gold (continued)

 

     

 

For the three months ended

       9/30/23        6/30/23      % Change        9/30/22      % Change

Tongon (89.7%)

              

Gold produced (000s oz)

     47        44      7 %      41      15 %

Cost of sales ($/oz)

     1,423        1,514      (6)%      1,744      (18)%

Total cash costs ($/oz)b

     1,217        1,380      (12)%      1,462      (17)%

All-in sustaining costs ($/oz)b

     1,331        1,465      (9)%      1,607      (17)%

Hemlo

              

Gold produced (000s oz)

     31        35      (11)%      28      11 %

Cost of sales ($/oz)

     1,721        1,562      10 %      1,670      3 %

Total cash costs ($/oz)b

     1,502        1,356      11 %      1,446      4 %

All-in sustaining costs ($/oz)b

     1,799        1,634      10 %      1,865      (4)%

North Mara (84%)

              

Gold produced (000s oz)

     62        64      (3)%      71      (13)%

Cost of sales ($/oz)

     1,244        1,208      3 %      956      30 %

Total cash costs ($/oz)b

     999        942      6 %      737      36 %

All-in sustaining costs ($/oz)b

     1,429        1,355      5 %      951      50 %

Bulyanhulu (84%)

              

Gold produced (000s oz)

     46        49      (6)%      48      (4)%

Cost of sales ($/oz)

     1,261        1,231      2 %      1,229      3 %

Total cash costs ($/oz)b

     859        850      1 %      898      (4)%

All-in sustaining costs ($/oz)b

     1,132        1,105      2 %      1,170      (3)%

Total Attributable to Barricke

              

Gold produced (000s oz)

     1,039        1,009      3 %      988      5 %

Cost of sales ($/oz)f

     1,277        1,323      (3)%      1,226      4 %

Total cash costs ($/oz)b

     912        963      (5)%      891      2 %

All-in sustaining costs ($/oz)b

     1,255        1,355      (7)%      1,269      (1)%

 

a.

These results represent our 61.5% interest in Carlin, Cortez, Turquoise Ridge, Phoenix and Long Canyon.

b.

Further information on these non-GAAP financial measures, including detailed reconciliations, is included on pages 59 to 76 of this MD&A.

c.

Includes Goldrush.

d.

As Porgera was placed on care and maintenance on April 25, 2020, no operating data or per ounce data is provided.

e.

Excludes Pierina, which is producing incidental ounces while in closure.

f.

Gold cost of sales per ounce is calculated as cost of sales across our gold operations (excluding sites in closure or care and maintenance) divided by ounces sold (both on an attributable basis using Barrick’s ownership share).

 

 

 

BARRICK THIRD QUARTER 2023    16    MANAGEMENT’S DISCUSSION AND ANALYSIS


OVERVIEW  

OPERATING

PERFORMANCE

 

 

GROWTH PROJECTS &

EXPLORATION

 

 

REVIEW OF FINANCIAL

RESULTS

 

 

OTHER INFORMATION & 

NON-GAAP 

RECONCILIATIONS 

 

FINANCIAL

STATEMENTS

 

Production and Cost Summary - Copper

 

     

For the three months ended

 

       9/30/23        6/30/23      % Change       9/30/22      % Change

Lumwana

              

Copper production (millions lbs)

     72        67      7 %      82      (12)%

Cost of sales ($/lb)

     2.48        2.80      (11)%      2.19      13 %

C1 cash costs ($/lb)a

     1.86        2.30      (19)%      1.78      4 %

All-in sustaining costs ($/lb)a

     3.41        3.29      4 %      3.50      (3)%

Zaldívar (50%)

              

Copper production (millions lbs)

     22        22      0 %      23      (4)%

Cost of sales ($/lb)

     3.86        3.89      (1)%      3.20      21 %

C1 cash costs ($/lb)a

     2.99        3.02      (1)%      2.45      22 %

All-in sustaining costs ($/lb)a

     3.39        3.73      (9)%      2.94      15 %

Jabal Sayid (50%)

              

Copper production (millions lbs)

     18        18      0 %      18      0 %

Cost of sales ($/lb)

     1.72        1.61      7 %      1.58      9 %

C1 cash costs ($/lb)a

     1.45        1.26      15 %      1.41      3 %

All-in sustaining costs ($/lb)a

     1.64        1.42      15 %      1.52      8 %

Total Copper

              

Copper production (millions lbs)

     112        107      5 %      123      (9)%

Cost of sales ($/lb)b

     2.68        2.84      (6)%      2.30      17 %

C1 cash costs ($/lb)a

     2.05        2.28      (10)%      1.86      10 %

All-in sustaining costs ($/lb)a

     3.23        3.13      3 %      3.13      3 %

 

a.

Further information on these non-GAAP financial measures, including detailed reconciliations, is included on pages 59 to 76 of this MD&A.

b.

Copper cost of sales per pound is calculated as cost of sales across our copper operations divided by pounds sold (both on an attributable basis using Barrick’s ownership share).

Operating Performance

 

 

In the first quarter of 2023, we re-evaluated our reportable operating segments and started detailed reporting on our interest in Lumwana and no longer provide detailed reporting on our interest in Veladero. As a result, our presentation of reportable operating segments consists of eight gold mines (Carlin, Cortez, Turquoise Ridge, Pueblo Viejo, Loulo-Gounkoto, Kibali, North Mara and Bulyanhulu) and one copper mine (Lumwana). The remaining operating

segments, including our remaining gold and copper mines, have been grouped into an “Other Mines” category and will not be reported on individually. Segment performance is evaluated based on a number of measures including operating income before tax, production levels and unit production costs. Certain costs are managed on a consolidated basis and are therefore not reflected in segment income.

 

 

 

 

BARRICK THIRD QUARTER 2023    17    MANAGEMENT’S DISCUSSION AND ANALYSIS


OVERVIEW  

OPERATING

PERFORMANCE

 

 

GROWTH PROJECTS &

EXPLORATION

 

 

REVIEW OF FINANCIAL

RESULTS

 

 

OTHER INFORMATION & 

NON-GAAP 

RECONCILIATIONS 

 

FINANCIAL

STATEMENTS

 

Nevada Gold Mines (61.5%)a, Nevada, USA

Summary of Operating and Financial Data

 

       For the three months ended          For the nine months ended
       9/30/23     6/30/23     % Change       9/30/22     % Change           9/30/23    9/30/22     % Change

Total tonnes mined (000s)

     42,953       45,386     (5)%      43,388     (1)%         124,840       134,093     (7)%

Open pit ore

     8,374       8,311     1 %      5,307     58 %         22,367       16,290     37 %

Open pit waste

     33,171       35,741     (7)%      36,701     (10)%         98,484       113,673     (13)%

Underground

     1,408       1,334     6 %      1,380     2 %         3,989       4,130     (3)%

Average grade (grams/tonne)

                     

Open pit mined

     0.80       1.20     (33)%      1.47     (46)%         1.04       1.12     (7)%

Underground mined

     9.28       8.75     6 %      8.61     8 %         8.88       8.86     0 %

Processed

     1.99       2.17     (8)%      2.69     (26)%         2.14       2.49     (14)%

Ore tonnes processed (000s)

     10,014       9,054     11 %      7,594     32 %         26,435       24,821     7 %

Oxide mill

     2,299       2,385     (4)%      3,037     (24)%         7,409       9,018     (18)%

Roaster

     1,364       1,199     14 %      1,408     (3)%         3,568       4,141     (14)%

Autoclave

     959       808     19 %      1,172     (18)%         2,483       3,346     (26)%

Heap leach

     5,392       4,662     16 %      1,977     173 %         12,975       8,316     56 %

Recovery rateb

     85 %       83 %     2 %      78 %     9 %         83 %       77 %     8 %

Oxide Millb

     82 %       77 %     6 %      71 %     15 %         78 %       71 %     10 %

Roaster

     86 %       86 %     0 %      86 %     0 %         86 %       85 %     1 %

Autoclave

     84 %       81 %     4 %      66 %     27 %         82 %       65 %     26 %

Gold produced (000s oz)

     478       458     4 %      425     12 %         1,352       1,346     0 %

Oxide mill

     96       86     12 %      79     22 %         285       223     28 %

Roaster

     228       247     (8)%      236     (3)%         657       707     (7)%

Autoclave

     106       90     18 %      83     28 %         278       263     6 %

Heap leach

     48       35     37 %      27     78 %         132       153     (14)%

Gold sold (000s oz)

     480       458     5 %      424     13 %           1,349       1,345     0 %

Revenue ($ millions)

     945       922     2 %      744     27 %         2,674       2,510     7 %

Cost of sales ($ millions)

     614       624     (2)%      531     16 %         1,844       1,630     13 %

Income ($ millions)

     314       287     9 %      215     46 %         790       880     (10)%

EBITDA ($ millions)c

     460       425     8 %      332     39 %         1,214       1,269     (4)%

EBITDA margind

     49 %       46 %     7 %      45 %     9 %         45 %       51 %     (12)%

Capital expenditures ($ millions)

     213       208     2 %      191     12 %         590       538     10 %

Minesite sustainingc

     162       162     0 %      163     (1)%         461       456     1 %

Projectc

     51       46     11 %      28     82 %         129       82     57 %

Cost of sales ($/oz)

     1,273       1,357     (6)%      1,242     2 %         1,359       1,193     14 %

Total cash costs ($/oz)c

     921       1,009     (9)%      924     0 %         998       865     15 %

All-in sustaining costs ($/oz)c

     1,286       1,388     (7)%      1,333     (4)%         1,366       1,227     11 %

All-in costs ($/oz)c

     1,389       1,489     (7)%      1,398     (1)%           1,461       1,288     13 %

 

  a. 

Barrick is the operator of NGM and owns 61.5%, with Newmont Corporation owning the remaining 38.5%. NGM is accounted for as a subsidiary with a 38.5% non-controlling interest. These results represent our 61.5% interest in Carlin, Cortez, Turquoise Ridge, Phoenix and Long Canyon.

  b. 

Excludes the Gold Quarry (Mill 5) concentrator.

  c.

Further information on these non-GAAP financial measures, including detailed reconciliations, is included on pages 59 to 76 of this MD&A.

  d.

Represents EBITDA divided by revenue.

NGM includes Carlin, Cortez, Turquoise Ridge, Phoenix and Long Canyon. Barrick is the operator of the joint venture and owns 61.5%, with Newmont owning the remaining 38.5%. Refer to the following pages for a detailed discussion of each minesite’s results.

 

 

 

BARRICK THIRD QUARTER 2023    18    MANAGEMENT’S DISCUSSION AND ANALYSIS


OVERVIEW  

OPERATING

PERFORMANCE

 

 

GROWTH PROJECTS &

EXPLORATION

 

 

REVIEW OF FINANCIAL

RESULTS

 

 

OTHER INFORMATION & 

NON-GAAP 

RECONCILIATIONS 

 

FINANCIAL

STATEMENTS

 

Carlin (61.5%), Nevada, USA

Summary of Operating and Financial Data

 

       For the three months ended          For the nine months ended
       9/30/23     6/30/23     % Change       9/30/22     % Change           9/30/23     9/30/22     % Change

Total tonnes mined (000s)

     19,674       18,690    

5 %

     17,574    

12 %

        52,721       56,125    

(6)%

Open pit ore

     600       1,641     (63)%      2,274     (74)%         3,328       4,738     (30)%

Open pit waste

     18,271       16,290     12 %      14,524     26 %         47,115       48,900     (4)%

Underground

     803       759     6 %      776     3 %         2,278       2,487     (8)%

Average grade (grams/tonne)

                     

Open pit mined

     1.50       2.80     (46)%      2.34     (36)%         2.46       1.77     39 %

Underground mined

     7.98       7.76     3 %      7.98     0 %         7.82       8.07     (3)%

Processed

     4.74       4.55     4 %      3.42     39 %         4.48       3.41     31 %

Ore tonnes processed (000s)

     1,707       2,072    

(18)%

     2,902    

(41)%

        5,416       8,988    

(40)%

Oxide mill

     0       0     0 %      618     (100)%         377       1,831     (79)%

Roasters

     1,219       1,047     16 %      1,161     5 %         3,118       3,402     (8)%

Autoclave

     349       384     (9)%      555     (37)%         821       1,672     (51)%

Heap leach

     139       641     (78)%      568     (76)%         1,100       2,083     (47)%

Recovery ratea

     85 %       84 %    

1 %

     78 %    

9 %

        84%       77 %    

9 %

Roasters

     86 %       86 %     0 %      85 %     1 %         86%       85 %     1 %

Autoclave

     80 %       69 %     16 %      47 %     70 %         74%       44 %     68%

Gold produced (000s oz)

     230       248    

(7)%

     229    

0 %

        644       701    

(8)%

Oxide mill

     0       0     0 %      10     (100)%         4       32     (88)%

Roasters

     194       213     (9)%      184     5 %         558       559     0 %

Autoclave

     27       26     4 %      24     13 %         58       72     (19)%

Heap leach

     9       9     0 %      11     (18)%         24       38     (37)%

Gold sold (000s oz)

     238       243     (2)%      226     5 %           645       702     (8)%

Revenue ($ millions)

     461       479     (4)%      390     18 %         1,254       1,285     (2)%

Cost of sales ($ millions)

     282       304     (7)%      261     8 %         828       772     7 %

Income ($ millions)

     174       169     3 %      123     41 %         409       514     (20)%

EBITDA ($ millions)b

     225       225     0 %      168     34 %         555       651     (15)%

EBITDA marginc

     49 %       47 %     4 %      43 %     14 %         44 %       51 %     (14)%

Capital expenditures ($ millions)

     103       90     14 %      76     36 %         265       221     20 %

Minesite sustainingb

     103       90     14 %      76     36 %         265       221     20 %

Projectb

     0       0     0 %      0     0 %         0       0     0 %

Cost of sales ($/oz)

     1,166       1,240     (6)%      1,137     3 %         1,266       1,064     19 %

Total cash costs ($/oz)b

     953       1,013     (6)%      943     1 %         1,042       877     19 %

All-in sustaining costs ($/oz)b

     1,409       1,407     0 %      1,304     8 %         1,480       1,211     22 %

All-in costs ($/oz)b

     1,409       1,407     0 %      1,304     8 %           1,480       1,211     22 %

 

  a. 

Excludes the Gold Quarry (Mill 5) concentrator.

  b. 

Further information on these non-GAAP financial measures, including detailed reconciliations, is included on pages 59 to 76 of this MD&A.

  c. 

Represents EBITDA divided by revenue.

 

Safety and Environment

 

For the three months ended  
     
      9/30/23      6/30/23  

LTI

     2        1  

LTIFR3

     1.02        1.07  

TRIFR3

     2.47        1.93  

Class 14 environmental incidents

     0        0  

Financial Results

Q3 2023 compared to Q2 2023

Carlin’s income for the third quarter of 2023 was 3% higher than the prior quarter primarily due to a lower cost of sales per ounce2, partially offset by marginally lower sales volumes and a lower realized gold price1.

Gold production in the third quarter of 2023 was 7% lower compared to the prior quarter primarily due to the lower average grade processed at the roasters. This was mainly driven by lower open pit ore tonnes mined at a lower average grade as mining in the Goldstar open pit was substantially completed early in the third quarter, leading to a higher proportion of lower grade stockpile tonnes processed at the roasters. This was partially offset by an increase in underground ore tonnes mined and processed

 

 

 

 

BARRICK THIRD QUARTER 2023    19    MANAGEMENT’S DISCUSSION AND ANALYSIS


OVERVIEW  

OPERATING

PERFORMANCE

 

 

GROWTH PROJECTS &

EXPLORATION

 

 

REVIEW OF FINANCIAL

RESULTS

 

 

OTHER INFORMATION & 

NON-GAAP 

RECONCILIATIONS 

 

FINANCIAL

STATEMENTS

 

and at a higher average grade. In addition, throughput and recovery were also higher compared to the prior quarter.

Total tonnes mined were 5% higher compared to the prior quarter, primarily driven by open pit sequencing per the mine plan. Open pit waste tonnes increased from both the Gold Quarry and the next phase of South Arturo. Open pit ore tonnes and grade mined were 63% and 46% lower, respectively, compared to the prior quarter, driven by a decrease in ore tonnes and grades at both Gold Quarry and South Arturo. At Gold Quarry, mining was slower than planned due to geotechnical impacts on the highwall and working through historic underground workings. This was combined with lower tonnes mined at the Goldstar open pit as mining of phase 4 was substantially completed early in the third quarter, with only small ramp retreats remaining. Underground tonnes mined were 6% higher than the prior quarter, due to mine sequencing and productivity improvements across Carlin’s underground operations while the average grade mined was slightly higher than the prior quarter.

Cost of sales per ounce2 and total cash costs per ounce1 in the third quarter of 2023 were both 6% lower than the prior quarter, largely reflecting reduced operating and maintenance costs, combined with higher capitalized waste stripping. This was partially offset by the lower average grade processed. In the third quarter of 2023, all-in sustaining costs per ounce1 were in line with the prior quarter as lower total cash costs per ounce1 was offset by higher minesite sustaining capital expenditures1.

Capital expenditures in the third quarter of 2023 increased by 14% compared to prior quarter, primarily due to higher capitalized waste stripping and underground development as per the mine plan.

Q3 2023 compared to Q3 2022

Carlin’s income for the three month period ended September 30, 2023 was 41% higher than the same prior year period due to higher sales volumes and a higher realized gold price1, partially offset by a higher cost of sales per ounce2.

Gold production for the three month period ended September 30, 2023 was in line with the same prior year period as increased production at the roasters and autoclave, owing to higher grades and throughput at the roasters and higher recoveries at the autoclave, was offset by the closure of the Gold Quarry concentrator at the end of the first quarter of 2023.

Total tonnes mined were 12% higher than the same prior year period with waste stripping ramping up at the next phase of South Arturo, whereas there was no mining at South Arturo in the same prior year period. This was offset by lower tonnes mined at Goldstar as mining of phase 4 was substantially completed at the beginning of the third quarter and the completion of the Goldstrike 5th NW pit in the fourth quarter of 2022. Average open pit mined grade decreased by 36% compared to the same prior year period, primarily due to completion of mining at the Goldstrike 5th NW pit. Underground tonnes mined were 3% higher while grade was in line with the same prior year period, driven by a change in the mix of ore sources across the different underground operations, as per the mine plan.

Cost of sales per ounce2 and total cash costs per ounce1 for the three month period ended September 30, 2023 were 3% and 1% higher, respectively, than the same prior year period, primarily due to higher maintenance costs related to timing. For the three month period ended September 30, 2023, all-in sustaining costs per ounce1 increased by 8% compared to the same prior year period,

mainly due to higher total cash costs per ounce1, combined with higher minesite sustaining capital expenditures1.

Capital expenditures in the third quarter of 2023 were 36% higher compared with the same prior year period, mainly due to higher capitalized waste stripping and underground development as per the mine plan.

YTD 2023 compared to YTD 2022

Carlin’s income for the nine month period ended September 30, 2023 was 20% lower than the same prior year period, mainly due to lower sales volume and an increase in cost of sales per ounce2. This was partially offset by a higher realized gold price1.

Gold production for the nine month period ended September 30, 2023 was 8% lower than the same prior year period, mainly due to the closure of the Gold Quarry concentrator at the end of the first quarter of 2023, combined with lower leach production driven by the leach cycle. In addition, production was impacted by the autoclave conversion from RIL to CIL in the first quarter of 2023 and the planned maintenance shutdowns at both roasters that occurred earlier in 2023. This was partially offset by a higher average grade processed.

Total tonnes mined decreased by 6% compared to the same prior year period. At the open pit operations, waste tonnes mined were lower, primarily driven by record snowfall levels impacting the first quarter of 2023, as well as open pit sequencing per the mine plan. This was partially offset by an increase in ore tonnes mined from the Goldstar open pit, where mining continued to advance in ore, resulting in lower waste tonnes mined compared to the same prior year period. In addition, waste stripping ramped-up at the next phase of South Arturo whereas there was no mining at South Arturo in the same prior year period. Average open pit mined grade increased by 39% compared to the same prior year period, primarily due to the progression of mining in the Gold Quarry and Goldstar open pits. Underground tonnes and grade mined were 8% and 3% lower, respectively, compared to the same prior year period, driven by a change in the mix of ore sources across the different underground operations, as per the mine plan.

Cost of sales per ounce2 and total cash costs per ounce1 for the nine month period ended September 30, 2023 were both 19% higher than the same prior year period, due to higher maintenance costs driven by the planned shutdowns at both roasters in 2023, higher maintenance costs related to the open pit trucks that are scheduled to be replaced in 2024, combined with the impact of lower sales volumes. For the nine month period ended September 30, 2023, all-in sustaining costs per ounce1 were 22% higher than the same prior year period, mainly due to higher total cash costs per ounce1, combined with higher minesite sustaining capital expenditures1.

Capital expenditures for the nine month period ended September 30, 2023 increased by 20%, primarily due to the continuing advancement of projects related to processing facilities and underground development, along with the timing of open pit and underground mobile equipment deliveries across Carlin’s mining operations.

 

 

 

 

BARRICK THIRD QUARTER 2023    20    MANAGEMENT’S DISCUSSION AND ANALYSIS


OVERVIEW  

OPERATING

PERFORMANCE

 

 

GROWTH PROJECTS &

EXPLORATION

 

 

REVIEW OF FINANCIAL

RESULTS

 

 

OTHER INFORMATION & 

NON-GAAP 

RECONCILIATIONS 

 

FINANCIAL

STATEMENTS

 

Cortez (61.5%)a, Nevada, USA

Summary of Operating and Financial Data

 

        For the three months ended          For the nine months ended
       9/30/23        6/30/23       % Change       9/30/22       % Change           9/30/23        9/30/22      % Change

Total tonnes mined (000s)

     16,613        20,143      (18)%      18,896      (12)%         52,082        55,124      (6)%

Open pit ore

     5,168        4,104      26 %      540      857%         11,444        3,247      252%

Open pit waste

     11,062        15,682      (29)%      17,993      (39)%         39,600        50,898      (22)%

Underground

     383        357      7 %      363      6 %         1,038        979      6 %

Average grade (grams/tonne)

                          

Open pit mined

     0.76        0.79      (4)%      0.44      73 %         0.78        0.85      (8)%

Underground mined

     9.65        9.21      5 %      9.43      2 %         9.41        9.58      (2)%

Processed

     1.17        1.21      (3)%      3.21      (64)%         1.31        2.29      (43)%

Ore tonnes processed (000s)

     5,266        3,973      33 %      1,092      382 %         11,776        4,536      160%

Oxide mill

     627        630      0 %      617      2 %         1,821        1,899      (4)%

Roasters

     145        152      (5)%      247      (41) %         450        739      (39)%

Heap leach

     4,494        3,191      41 %      228      1,871 %         9,505        1,898      401 %

Recovery rate

     86 %        82 %      5 %      81 %      6 %         84 %        80 %      5 %

Oxide Mill

     85 %        80 %      6 %      72 %      18 %         82 %        71 %      15 %

Roasters

     88 %        87 %      1 %      88 %      0 %         87 %        88 %      (1)%

Gold produced (000s oz)

     137        110      25 %      98      40 %         387        310      25 %

Oxide Mill

     67        55      22 %      38      76 %         191        105      82 %

Roasters

     33        33      0 %      52      (37)%         97        148      (34)%

Heap leach

     37        22      68 %      8      363 %         99        57      74 %

Gold sold (000s oz)

     135        112      21 %      99      36 %           384        312      23 %

Revenue ($ millions)

     259        220      18 %      169      53 %         741        568      30 %

Cost of sales ($ millions)

     168        150      12 %      105      60 %         500        347      44 %

Income ($ millions)

     87        66      32 %      62      40 %         231        214      8 %

EBITDA ($ millions)b

     141        107      32 %      90      57 %         382        310      23 %

EBITDA marginc

     54 %        49 %      10 %      53 %      2 %         52 %        55 %      (5)%

Capital expenditures ($ millions)

     56        68      (18)%      80      (30)%         180        209      (14)%

Minesite sustainingb

     38        50      (24)%      63      (40)%         129        165      (22)%

Projectb

     18        18      0 %      17      6 %         51        44      16 %

Cost of sales ($/oz)

     1,246        1,346      (7)%      1,056      18 %         1,303        1,112      17 %

Total cash costs ($/oz)b

     840        972      (14)%      770      9 %         905        800      13 %

All-in sustaining costs ($/oz)b

     1,156        1,453      (20)%      1,426      (19)%         1,270        1,355      (6)%

All-in costs ($/oz)b

     1,290        1,618      (20)%      1,602      (19)%           1,404        1,498      (6)%

 

  a. 

Includes Goldrush.

  b. 

Further information on these non-GAAP financial measures, including detailed reconciliations, is included on pages 59 to 76 of this MD&A.

  c. 

Represents EBITDA divided by revenue.

 

Safety and Environment

 

For the three months ended  
     
      9/30/23      6/30/23  

LTI

     0        1  

LTIFR3

     0        0.94  

TRIFR3

     0.93        1.88  

Class 14 environmental incidents

     0        0  

Financial Results

Q3 2023 compared to Q2 2023

Cortez’s income for the third quarter of 2023 was 32% higher than the prior quarter due to higher sales volumes and lower cost of sales per ounce2, partially offset by a lower realized gold price1.

Gold production in the third quarter of 2023 was 25% higher than the prior quarter, resulting from higher production sourced from ore mined at the Crossroads open pit, and processed at both at the oxide mill and the leach pad. Additional oxide mill ounces were also produced from Cortez Hills underground combined with higher refractory production from both CHUG and the Goldrush bulk sample.

Total tonnes mined were 18% lower compared to the prior quarter primarily driven by lower waste tonnes mined at the open pits. Open pit ore tonnes mined were 26% higher than the prior quarter with the average grade mined 4% lower. This was mainly due to mine sequencing

 

 

 

 

BARRICK THIRD QUARTER 2023    21    MANAGEMENT’S DISCUSSION AND ANALYSIS


OVERVIEW  

OPERATING

PERFORMANCE

 

 

GROWTH PROJECTS &

EXPLORATION

 

 

REVIEW OF FINANCIAL

RESULTS

 

 

OTHER INFORMATION & 

NON-GAAP 

RECONCILIATIONS 

 

FINANCIAL

STATEMENTS

 

at both Crossroads and Cortez Pits. Underground tonnes mined were 7% higher than the prior quarter, driven by the mine sequence and planned major maintenance performed on the Cortez Hills conveyor, which was completed in the second quarter. Underground grades mined were 5% higher than the prior quarter.

Cost of sales per ounce2 and total cash costs per ounce1 in the third quarter of 2023 were 7% and 14% lower, respectively, than the prior quarter, primarily due to a higher proportion of lower cost oxide ounces in the sales mix, lower operating and maintenance costs on refractory production, partially offset by higher fuel prices. In the third quarter of 2023, all-in sustaining costs per ounce1 were 20% lower than the prior quarter, driven by lower total cash costs per ounce1, combined with decreased minesite sustaining capital expenditures1.

Capital expenditures in the third quarter of 2023 were 18% lower than the prior quarter, primarily due to lower minesite sustaining expenditures1. Minesite sustaining capital expenditures1 were 24% lower compared to the prior quarter, mainly due to lower capitalized waste stripping and a reduction in the number of new haul trucks commissioned.

Q3 2023 compared to Q3 2022

Cortez’s income for the three month period ended September 30, 2023 was 40% higher than the same prior year period, primarily due to a higher sales volume and a higher realized gold price1, partially offset by a higher cost of sales per ounce2.

Gold production for the three month period ended September 30, 2023 was 40% higher than the same prior year period, primarily driven by higher production sourced from ore mined at the Crossroads open pit, and processed at both at the oxide mill and the leach pad. This was combined with higher underground production, slightly offset by lower refractory ore sourced from the Pipeline open pit.

Total tonnes mined were 12% lower compared to the same prior year period, driven by lower open pit waste tonnes mined, partially offset by higher open pit ore tonnes mined and improved underground performance. Open pit ore tonnes and grade mined were almost nine times higher and 73% higher, respectively, compared to the same prior year period, driven by mine plan sequencing at Crossroads and the development of Cortez Pits. Underground tonnes mined increased by 6% over the same prior year period, primarily driven by Cortez Hills underground and increased development activity at Goldrush underground.

Cost of sales per ounce2 and total cash costs per ounce1 for the three month period ended September 30, 2023 were 18% and 9% higher, respectively, than the same prior year period, due to lower grades processed, reflecting a substantially higher proportion of ounces sourced from the open pit operations. For the three month period ended September 30, 2023, all-in sustaining costs per ounce1 decreased by 19% compared to the same prior year period, due to lower minesite sustaining capital expenditures, partially offset by higher total cash costs per ounce1.

Capital expenditures for the three month period ended September 30, 2023 decreased by 30% from the same prior year period, due to lower minesite sustaining capital expenditures1, while project capital expenditures1 were slightly higher than the prior year period. Minesite sustaining capital expenditures1 were 40% lower than the

same prior year period resulting from lower capitalized waste stripping, primarily at Crossroads. Project capital expenditures1 were 6% higher than the same prior year period due to increased activity at Goldrush.

YTD 2023 compared to YTD 2022

Cortez’s income for the nine month period ended September 30, 2023 was 8% higher than the same prior year period, primarily due to higher sales volume and a higher realized gold price1, partially offset by a higher cost of sales per ounce2.

Gold production for the nine month period ended September 30, 2023 was 25% higher than the same prior year period. This was primarily driven by higher oxide ore tonnes mined and processed from Crossroads and Cortez Hills underground (at a higher recovery rate), combined with higher heap leach production. This was partially offset by a decrease in refractory ore shipped and processed at the Carlin roasters.

Total tonnes mined were 6% lower than the same prior year period primarily due to lower open pit waste mined. Open pit ore tonnes mined were 252% higher compared to the same prior year period, primarily driven by the transition from the Pipeline pit, which ceased mining operations in the first quarter of 2022, to the next phases at Crossroads and Cortez Pits which have predominantly been mining in ore this year. Underground tonnes mined increased by 6% over the same prior year period, driven by Cortez Hills underground and increased development activity at Goldrush.

Cost of sales per ounce2 and total cash costs per ounce1 for the nine month period ended September 30, 2023 were 17% and 13% higher, respectively, than the same prior year period due to lower grades processed, reflecting a higher proportion of ounces sourced from the open pit operations, combined with lower capitalized waste stripping. For the nine month period ended September 30, 2023, all-in sustaining costs per ounce1 decreased by 6% compared to the same prior year period, due to lower minesite sustaining capital expenditures1, partially offset by higher total cash costs per ounce1.

Capital expenditures for the nine month period ended September 30, 2023 decreased by 14% from the same prior year period, due to lower minesite sustaining capital expenditures1, partially offset by higher project capital expenditures1. Minesite sustaining capital expenditures1 were 22% lower compared to the same prior year period, primarily due to a decrease in capitalized waste stripping at Crossroads. Project capital expenditures1 were 16% higher due to increased activity at Goldrush.

 

 

 

 

BARRICK THIRD QUARTER 2023    22    MANAGEMENT’S DISCUSSION AND ANALYSIS


OVERVIEW  

OPERATING

PERFORMANCE

 

 

GROWTH PROJECTS &

EXPLORATION

 

 

REVIEW OF FINANCIAL

RESULTS

 

 

OTHER INFORMATION & 

NON-GAAP 

RECONCILIATIONS 

 

FINANCIAL

STATEMENTS

 

Turquoise Ridge (61.5%), Nevada, USA

Summary of Operating and Financial Data

 

        For the three months ended     For the nine months ended
       9/30/23       6/30/23       % Change         9/30/22       % Change     9/30/23      9/30/22       % Change

Total tonnes mined (000s)

     222        218        2 %        241        (8)%         673        687      (2)%

Open pit ore

     0        0        0 %        0        0 %       0        24      (100)%

Underground

     222        218        2 %        241        (8)%       673        663      2 %

Average grade (grams/tonne)

                      

Open pit mined

     n/a        n/a        n/a        n/a        n/a       n/a        1.52      n/a

Underground mined

     12.73        11.22        13 %        9.48        34 %       11.36        10.76      6 %

Processed

     4.37        4.85        (10)%        3.61        21 %       4.29        4.06      6 %

Ore tonnes processed (000s)

     704        504        40 %        699        1 %       1,937        1,939      0 %

Oxide Mill

     94        80        18 %        82        15 %       275        265      4 %

Autoclave

     610        424        44 %        617        (1)%       1,662        1,674      (1)%

Recovery rate

     86 %        87 %        (1)%        78 %        10 %       85 %        80 %      6 %

Oxide Mill

     87 %        85 %        2 %        89 %        (2)%       86 %        83 %      4 %

Autoclave

     86 %        87 %        (1)%        78 %        10 %       85 %        79 %      8 %

Gold produced (000s oz)

     83        68        22 %        62        34 %       232        204      14 %

Oxide Mill

     4        3        33 %        1        300 %       10        7      43 %

Autoclave

     79        64        23 %        59        34 %       220        191      15 %

Heap leach

     0        1        (100)%        2        (100)%       2        6      (67)%

Gold sold (000s oz)

     78        72        8 %        64        22 %       232        204      14 %

Revenue ($ millions)

     150        143        5 %        108        39 %       449        371      21 %

Cost of sales ($ millions)

     101        106        (5)%        95        6 %       323        286      13 %

Income ($ millions)

     49        35        40 %        11        345 %       124        81      53 %

EBITDA ($ millions)a

     77        61        26 %        36        114 %       209        159      31 %

EBITDA marginb

     51 %        43 %        19 %        33 %        55 %       47 %        43 %      9 %

Capital expenditures ($ millions)

     13        15        (13)%        28        (54)%       49        74      (34)%

Minesite sustaininga

     12        14        (14)%        19        (37)%       44        52      (15)%

Projecta

     1        1        0 %        9        (89)%       5        22      (77)%

Cost of sales ($/oz)

     1,300        1,466        (11)%        1,509        (14)%       1,391        1,403      (1)%

Total cash costs ($/oz)a

     938        1,088        (14)%        1,105