Barrick CEO Warns of Ongoing Inflation Impact on Results Due to Higher Costs
Barrick Gold Corp.’s CEO, Mark Bristow, believes that inflation will continue to be a challenge for the mining industry. Despite expectations that inflation could start to ease as central banks increase borrowing costs, Bristow doesn’t see a significant change in the situation.
During an interview , Bristow highlighted that “no one’s doing anything to kill inflation” and that “it’s definitely not over.” In 2022, Barrick’s earnings were affected by higher inflation, lower production, and “challenges” at the Turquoise Ridge mine in Nevada. Fourth-quarter results missed guidance on costs, causing Barrick’s shares to drop by up to 4.5% in Toronto.
Nevertheless, Bristow sees some positive developments on the cost front, such as easing fuel expenses due to a drop in natural gas prices. However, labor costs remain high, particularly in African operations in Mali and the Democratic Republic of Congo.
In response to these challenges, Barrick plans to invest more in its operations, with “organic growth” expected to add 1 million ounces of gold production over the next two years. Bristow noted that this year has a substantial capital investment and that the company would increase its mining fleet, which would impact cash flow.
