Barrick Gold plans US$2 billion Zambia copper expansion
Barrick Gold Corp.’s [ABX-TSX, GOLD-NYSE] is investing US$2 billion in an expansion project designed to increase the annual production at its Lumwana mine in Zambia to 240,000 tonnes of copper annually. The move will elevate the once unprofitable operation into the front rank of global copper producers.
Production will come from a 50 million tonne per annual process plant over a mine life of 36 years. The project’s accelerated work program is targeting completion of the full feasibility study by the end of 2024, bringing expected expanded process plant production forward to 2028.
Barrick’s transformation of its Lumwana mine into a world class producer will provide strong impetus for the government’s thrust to revive the county’s copper industry, said Barrick President and CEO Mark Bristow after a meeting with Zambian President Hakande Hichilema.
On October 3, 2023, Barrick shares rose 0.154% or $0.03 to $19.46 and currently trade in a 52-week range of $28.19 and $17.88.
Barrick has gold and copper mining operations and projects in 13 countries in North and South America, Africa, Papua New Guinea and Saudi Arabia.
The portfolio includes half of the world’s top 10 tier one gold assets (defined as having a mine life of over 10 years, at least 500,000 ounces of annual production and in the bottom half of global total cash costs).
They include Cortez and Goldstrike in Nevada, Kibali in the Democratic Republic of Congo, Loulo-Gounkoto in Mali, and Pueblo Viejo.
Another key asset is Barrick’s Nevada Gold Mines operation. Nevada Gold Mines, established in July 2019, is owned 61.5% and operated by Barrick Gold. Newmont Corp. [NGT-TSX, NEM-NYSE] holds the other 38.5%.
The joint venture ranks as the largest global gold producing complex by a wide margin, with three of the world’s top 10 Tier One gold assets (Goldstrike/Carlin, Cortez and Turquoise Ridge/Twin Creeks) and potentially another one in the making (Goldrush).
Lumwana is a conventional open pit (truck and shovel) operation, located about 100 kilometres west of Solwezi in Zambia’s Copperbelt. The operation produced 115 million pounds of copper in the first six months of 2023.
Since Barrick took over operations at Lumwana in 2019, the mine has contributed almost US$3 billion to the Zambian economy in the form of taxes, royalties, salaries and procurement of goods and services. In addition to its local procurement policy, the company is also committed to local employment, and 99.3% of Lumwana’s current workforce are Zambian nationals.
Looking at Lumwana’s current performance, Bristow said it was on track to deliver its production guidance for 2023 and was ramping up owner mining in both the reopening at the Malundwe pit as well as delivery of the new owner mining pre-stripping fleet.