Shandong Gold in advanced talks to buy 50% in Barrick Gold's Veladero gold mine

China's Shandong Gold Mining Co Ltd is in advanced talks to buy 50-per cent stake in Barrick Gold Corp's Veladero gold mine in Argentina, Reuters yesterday reported, citing people familiar with the process.

A sale could fetch the world's biggest gold miner more than $1 billion, the report said.

The talks with Shandong are at the "final stage of agreeing the conditions and amounts," the report added.

The Veladero mine is located in the San Juan Province of Argentina in the highly prospective Frontera District and accounted for almost 10 per cent of Barrick's total gold production in 2016.
Veladero is a conventional open-pit operation where ore is crushed by a two-stage crushing process and transported via overland conveyor and trucks to the leach pad area. Run-of-mine ore is trucked directly to the valley-fill leach pad.

Veladero produced 544,000 ounces of gold in 2016, at a cost of sales of $872 per ounce, and all-in sustaining costs of $769 per ounce.

Proven and probable mineral reserves are 6.7 million ounces of gold (252 million tonnes, grading 0.83 grams per tonne).

Barrick Gold expects gold production in 2017 to be 770,000-830,000 ounces, at a cost of sales of $750-$800 per ounce, and all-in sustaining costs of $840-$940 per ounce.

Last month, Barrick Gold discovered a rupture in the pipelines carrying gold-bearing solution on the leach pad in the Valdero mine, leading to the government of San Juan province temporarily restricting operations and the addition of cyanide to the mine's heap leach facility pending repairs.