BARRICK SHOULD ‘ THINK BIG’ FOR GROWTH: J. P. MORGAN

Barrick Gold Corp. needs to “think big” when it comes to acquisitions, with a new report suggesting now is the time to refill its project pipeline to avoid steep production declines in the coming years.

“Barrick is the world’s largest gold miner and — like a supertanker — has to move early to avoid bad outcomes,” John Bridges at J. P. Morgan told clients on Thursday.

“Now is probably the time to think about reserve replacement,” Bridges said.

Even when including the company’s four new projects under study, the analyst projects that gold production will fall into the next decade. “While 2020 seems distant, the long timeline for new projects requires miners to think well ahead or buy assets when opportunities appear,” Bridges said.

He put together a list of miners that appear to offer earnings accretion based on several metrics. AngloGold Ashanti Ltd. tops the list with 137 per cent total potential accretion, followed by Newcrest Mining Ltd. at 32 per cent and Yamana Gold Inc. at 15 per cent.

Newmont is next at six per cent, while names like Pretium Resources Inc., Torex Gold Resources Inc., Detour Gold Corp., Goldcorp Inc. and Agnico Eagle Mines Ltd. are all expected to offer negative total accretion.