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Barrick Gold 3Q Output Up From 2Q; Guidance Maintained

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(Kitco News) - Barrick Gold Corp. (NYSE, TSX: ABX) late Wednesday reported that production of both gold and copper rose in the third quarter from the second and also reiterated its output guidance for 2018.

The world’s largest gold-mining company, which last month agreed to purchase Randgold Resources Ltd. in an all-stock deal, listed July-September output of 1.15 million ounces of gold and sales of 1.2 million. The company also reported copper output of 106 million pounds and sales of 114 million.

Gold production was 8% higher in the third quarter than the second primarily due to improved throughput and grade at Barrick Nevada, Barrick said. The third-quarter gold cost of sales per ounce is expected to be around 3% to 5% lower than the second quarter, cash costs are seen 1% to 3% percent lower and all-in sustaining costs are projected to be 7% to 9% lower.

“We are maintaining our 2018 consolidated gold production guidance of 4.5-5.0 million ounces, at a cost of sales of $810-$850 per ounce, cash costs of $540-$575 per ounce and all-in sustaining costs of $765-$815 per ounce,” Barrick said. “We expect gold production to be approximately 1.25 million ounces in the fourth quarter.”

Meanwhile, the copper output in the July-September quarter was 28% higher than in the second quarter primarily due to production at Lumwana, which was driven by a steady improvement in grade and recovery, plus improved crusher reliability, Barrick said. The company expects a quarter-over-quarter decrease in consolidated copper cost of sales per pound of approximately 10% to 12%, cash costs to be approximately 7% to 9% lower, and all-in sustaining costs per pound to be down some 10% to 12%.

“We are maintaining our 2018 copper production guidance of 345-410 million pounds, at a cost of sales of $2.00-$2.30 per pound, C1 cash costs of $1.80-$2.00 per pound and all-in sustaining costs of $2.55-$2.85 per pound,” Barrick said.

Average prices in the third quarter were $1,213 for an ounce of gold and $2.77 for a pound of copper, Barrick said.

The company said it expects its full-year 2018 effective tax rate to be approximately 48% to 50%, assuming a gold price of $1,200 per ounce for the rest of the year. This is an increase from previous tax guidance of 44% to 46%.

Barrick is scheduled to report full third-quarter financial results on Oct. 24.

Disclaimer: The views expressed in this article are those of the author and may not reflect those of Kitco Metals Inc. The author has made every effort to ensure accuracy of information provided; however, neither Kitco Metals Inc. nor the author can guarantee such accuracy. This article is strictly for informational purposes only. It is not a solicitation to make any exchange in commodities, securities or other financial instruments. Kitco Metals Inc. and the author of this article do not accept culpability for losses and/ or damages arising from the use of this publication.

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