Barrick sees no risk to its stake in Mali

Barrick Gold Corp does not see a big risk that Mali will change its mining conventions, CEO Mark Bristow said on Thursday, as the company raised its dividend and reported a near threefold jump in quarterly profit.

Mali's transitional government last week said it aims to review mining conventions after the West African country's auditor general said they do not always protect the state's interests.

In a report dated March 30, the auditor general alleged that the Barrick subsidiaries controlling the Loulo and Gounkoto mines owe the government 60.53 billion CFA francs (US$108.7 million) including unpaid taxes and dividends.

Bristow said that dispute has already been settled, and the company — Mali's biggest foreign investor — had agreed to a payment with the government last year.

“I don't see it as a sinister situation at all,” Bristow told Reuters, referring to the mining conventions.

Barrick shares jumped 4.9 per cent Thursday as gold's surge to around US$2,000 an ounce propelled adjusted profit for the quarter ended Sept. 30 to US$726 million, or 41 cents per share, from US$264 million, or 15 cents, a year earlier.

Barrick declared a dividend of 9 cents per share, a 12.5 per cent increase on the previous quarter's dividend.

Gold production fell as the Porgera project in Papua New Guinea remained shut.

Papua New Guinea and Barrick have agreed in principle over Porgera, with Barrick Niugini Ltd set to remain operator of the project.

Bristow said he would travel to the South Asian country next week and that he hoped to resolve the lease dispute soon.

He said Barrick has looked at early-stage exploration prospects in neighbouring Indonesia, home to Freeport-McMoran's Grasberg copper-gold mine.

“But our big focus at the moment is just dealing with our Porgera challenge first.”

Barrick is studying noncore asset sales that could include projects in South America, Bristow said, adding that the company would retain the Veladero mine in Argentina.

Bristow said the US$500 million belonging to its Kibali joint venture in Democratic Republic of Congo will be paid out soon, after months of discussions with the government over how to get the money out of the country.