Barrick Signs MoU with Zambia to Boost Mining and Exploration

Gold and copper mining company Barrick has signed a memorandum of understanding (MoU) with a resources organisation of the government of Zambia, which is aimed at boosting exploration and mining in the well-endowed Central African country.

The collaboration aligns with Zambia's vision of increasing its copper production to three-million tons a year in the coming decades, South African-born Barrick CEO Dr Mark Bristow revealed on Wednesday, when the New York- and Toronto-listed Barrick he leads delivered another outstanding set of financial results, notwithstanding the issues it is having to deal with in Mali, where gold sales were down significantly owing to the restrictions placed on exports by the Malian government.

The MoU has been signed with Industrial Resources Limited or IRL, a subsidiary of the Zambian government’s Industrial Development Corporation.

The purpose is to establish a strategic partnership capable of unlocking maximum mineral potential amid Barrick’s own Lumwana Super Pit copper expansion project in Zambia having advanced to full permitting status.

When Barrick acquired Lumwana copper mine in 2011, it was unprofitable, which resulted in a $5-billion writedown in the past five years. But a focus on cost discipline and exploration has added significantly to its reserves and has extended the life-of-mine by more than 20 years.

“Today, the mine is sustainably profitable and a pillar of our copper growth strategy,” Bristow remarked during the presentation of fourth-quarter results covered by Mining Weekly.

In the three months to December 31, Lumwana reported a stellar set of record quarterly production results that brought the mine back into guidance with considerable cost improvement.

“With the Super Pit expansion feasibility study completed, we're now moving forward with project development following board approval. The feasibility study clearly supports the value of this investment.

"Importantly, Barrick is able to fund the Super Pit expansion through its current and forecast cash flow facilities without needing to issue any new shares or take on additional debt.

“We've appointed our engineering partners and finalised the environmental and social impact studies for which we now have received the permit. We’re also on track with early works design and long lead item fabrication.

“This highlights the big advantage of emerging markets, where large expansions and new projects can be completed much more quickly than in the developed world, but at exactly the same standard,” Bristow noted.

This article originally appeared on Mining Weekly