The Administrative Minister of the Presidency, Jose Ramon Peralta, said the Dominican government has not been officially notified of the transaction carried out by Barrick Gold Corporation with Royal Gold regarding the Pueblo Viejo mine. Minister of Energy and Mines Antonio Isa Conde had requested on Thursday, 6 August 2015, official and precise information on the agreement.
The president of the Barrick Pueblo Viejo mine in the Dominican Republic, Manuel Rocha, told the press the deal will not affect the commitments contracted with the Dominican government.
Barrick has announced a streaming agreement with Royal Gold, related to Barrick’s 60% stake in the Pueblo Viejo mine.
Barrick co-president Kelvin Dushnisky has said the deal will “strengthen the balance sheet in the short term while preserving material exposure to higher gold and silver prices in the future.”
Gold bullion has lost roughly 40% of its value since 2011, which has left mining companies scrambling to reduce how much they spend to produce each ounce of the precious metal. Some experts say gold’s value may drop further if, as many expect, the US Federal Reserve hikes interest rates this fall. That could prompt investors to ditch safe havens like gold in favor of US dollars.
Under the agreement, Barrick will sell a portion of the gold and silver produced at the mine to Royal Gold, in exchange for a US$610-million upfront payment as well as ongoing cash payments, the Canadian company announced.
Pueblo Viejo is the only mine in the world with annual production of more than one million ounces of gold (100 percent basis), while maintaining costs below US$700 per ounce. Barrick’s share of gold production in 2014 was 665,000 ounces at a cost of US$588 per ounce. Gold production in 2015 is forecast to be between 625,000 and 675,000 ounces (Barrick’s share) at a cost of US$540-US$590 per ounce.
As at December 31, 2014, Pueblo Viejo had proven and probable gold reserves of 9.3 million ounces.
http://www.barrick.com/investors/news/news-details/2015/Barrick-Announces-Streaming-Agreement-With-Royal-Gold/default.aspx
http://www.royalgold.com/investors/news/news-details/2015/Royal-Gold-Announces-Agreement-to-Acquire-Gold-and-Silver-Stream-on-Barricks-Interest-in-the-Pueblo-Viejo-Mine/default.aspx
http://www.vancouversun.com/business/resources/Barrick+Gold+sells+mines+cuts+dividend+plan+billion/11270760/story.html#ixzz3iD9zFbrO
http://www.7dias.com.do/portada/2015/08/06/i194100_gobierno-pide-informe-preciso-barrick-sobre-acuerdo-con-royal-gold.html#.VcR-R_l_Oko