Barrick Gold strikes deal to sell idled Lagunas Norte gold mine in Peru
TORONTO - Barrick Gold Corp. says it has struck a deal to sell its idled Lagunas Norte mine in Peru as part of an ongoing drive to off-load non-core assets.
The gold mine, which was placed on care and maintenance in 2019 as it neared its end of life, is being sold to Boroo Pte Ltd. of Singapore for up to US$81 million, plus the assumption of Barrick’s closure liability of US$226 million.
Barrick says the deal will give Boroo the opportunity to extend the mine’s life by accessing satellite resources and adapting its infrastructure, adding a Barrick team will remain in Peru to continue to develop its portfolio of other gold and copper exploration prospects there.
The Toronto-based miner says the Lagunas Norte buyer is to pay US$20 million initially, US$10 million on the first anniversary of closing and US$20 million on the second anniversary.
It is also to pay a two per cent net smelter return royalty on gold and silver produced through the refractory sulphide ore project, which will end once one million ounces of gold has been produced, plus a contingent payment of up to $15 million based on the average gold price per ounce for the two-year period after closing.
Boroo is also to assume 100 per cent of Barrick’s US$173-million reclamation bond obligations for Lagunas Norte.
Barrick CEO Mark Bristow says the sale is in line with Barrick’s policy of selling non-core interests in order to focus on its best assets, a process which has resulted in US$1.5 billion in asset sales since it was announced in the spring of 2019.