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Barrick, Novagold to Advance Donlin Project Optimization
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Barrick Gold and its partner, Novagold Resources said that Donlin Gold LLC has approved a drill program geared to further optimize the Donlin Gold project in Alaska. Donlin Gold LLC, which is equally owned and supported by Barrick and Novagold, is advancing the project.
The project has 39 million ounces of gold measured and indicated resources with a grade averaging 2.2 grams of gold per ton (100% basis), placing it among the biggest and highest-quality undeveloped gold deposits in the world.
Following a comprehensive analysis of the project’s parameters, Barrick and Novagold came to the conclusion that the potential exists to enhance the project economics through a more cost-effective project execution plan that could considerably minimize upfront capital. To support this, the companies have approved an $8 million budget for a drill program to collect geologic and geotechnical data in 2017.
The companies noted that the program has been developed as a result of highly encouraging outcomes that were attained from a number of wide-ranging optimization evaluations of the ore body that resulted in an operationally sound and potentially financially attractive development approach. The Donlin Gold team is currently focusing on completing the ongoing permitting activities that are progressing as planned.
Barrick, which shares the same industry space along with Newmont (NEM - Free Report) , Kinross Gold (KGC - Free Report) and Goldcorp , is expected to benefit from its major exploration programs. A significant portion of the company's exploration budget (80% of total exploration budget of $185-$225 million) for 2017 has been allocated to the Americas.
Moreover, Barrick has entered into a 50-50 joint venture with Goldcorp in the Maricunga district in Chile that will combine the Cerro Casale and Caspiche deposits into a single project. The combination will offer significant economy of scale and will allow both companies to leverage potential synergies within the Maricunga Gold Belt. The companies expect to increase the net asset value per share from these projects by combining financial and technical capabilities and deliver value to all stakeholders and partners.
Barrick should also gain from its cost and efficiency improvement actions amid a a volatile gold pricing environment. The company also remains committed to de-leverage its balance sheet. Barrick looks to reduce its total debt by $2.9 billion to $5 billion by the end of 2018, half of which have been targeted in 2017.
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Barrick, Novagold to Advance Donlin Project Optimization
Barrick Gold and its partner, Novagold Resources said that Donlin Gold LLC has approved a drill program geared to further optimize the Donlin Gold project in Alaska. Donlin Gold LLC, which is equally owned and supported by Barrick and Novagold, is advancing the project.
The project has 39 million ounces of gold measured and indicated resources with a grade averaging 2.2 grams of gold per ton (100% basis), placing it among the biggest and highest-quality undeveloped gold deposits in the world.
Following a comprehensive analysis of the project’s parameters, Barrick and Novagold came to the conclusion that the potential exists to enhance the project economics through a more cost-effective project execution plan that could considerably minimize upfront capital. To support this, the companies have approved an $8 million budget for a drill program to collect geologic and geotechnical data in 2017.
The companies noted that the program has been developed as a result of highly encouraging outcomes that were attained from a number of wide-ranging optimization evaluations of the ore body that resulted in an operationally sound and potentially financially attractive development approach. The Donlin Gold team is currently focusing on completing the ongoing permitting activities that are progressing as planned.
Barrick, which shares the same industry space along with Newmont (NEM - Free Report) , Kinross Gold (KGC - Free Report) and Goldcorp , is expected to benefit from its major exploration programs. A significant portion of the company's exploration budget (80% of total exploration budget of $185-$225 million) for 2017 has been allocated to the Americas.
Moreover, Barrick has entered into a 50-50 joint venture with Goldcorp in the Maricunga district in Chile that will combine the Cerro Casale and Caspiche deposits into a single project. The combination will offer significant economy of scale and will allow both companies to leverage potential synergies within the Maricunga Gold Belt. The companies expect to increase the net asset value per share from these projects by combining financial and technical capabilities and deliver value to all stakeholders and partners.
Barrick should also gain from its cost and efficiency improvement actions amid a a volatile gold pricing environment. The company also remains committed to de-leverage its balance sheet. Barrick looks to reduce its total debt by $2.9 billion to $5 billion by the end of 2018, half of which have been targeted in 2017.
The Best & Worst of Zacks
Today you are invited to download the full, up-to-the-minute list of 220 Zacks Rank #1 "Strong Buys" free of charge. From 1988 through 2015 this list has averaged a stellar gain of +25% per year. Plus, you may download 220 Zacks Rank #5 "Strong Sells." Even though this list holds many stocks that seem to be solid, it has historically performed 6X worse than the market. See these critical buys and sells free >>