An investor’s guide to the world’s largest gold mining company

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Oct. 16 2014, Published 6:59 p.m. ET

World’s largest gold producer

Barrick Gold Corporation (ABX) is the world’s largest gold producer. It produces and sells gold. Barrick also produces significant amounts of copper. Barrick has the largest quantity of gold reserves, totaling 104.1 million ounces as of December, 2013. It also has 14 billion pounds of copper reserves.

Barrick is one of the most efficient gold producers, producing 7.2 million ounces of gold in 2013 at all-in sustaining cash costs, or AISC, of $865 per ounce. This is among the lowest three in terms of gold production costs.

 

Gold reserves

The company has operating mines and projects in Canada, the U.S., the Dominican Republic, Australia, Papua New Guinea, Peru, Chile, Argentina, Zambia, Saudi Arabia, and Tanzania. Its products are sold in the world market through these distribution channels:

  • Gold bullion—gold spot market
  • Gold and copper concentrate—independent smelting companies
  • Copper cathode—various manufacturers and traders

Operating units

Barrick is organized into ten operating units:

  • Five individual gold mines—Cortez, Goldstrike, Pueblo Viejo, Lagunas Norte, and Veladero
  • Two gold mine portfolios—North America-Other and Australia Pacific
  • 9% equity interest in African Barrick Gold plc (ABG)
  • One global copper business
  • One project (Pascua-Lama)

More than half of Barrick’s gold production comes from five core mines. We’ll discuss each of these in detail later in this series.

Peers

Barrick Gold’s peers in the gold and copper market include Goldcorp Inc. (GG), Newmont Mining Corp (NEM), Kinross Gold Corporation (KGC), Yamana Gold Inc. (AUY), Agnico Eagle Mines Ltd (AEM), and Freeport-McMoRan Inc (FCX), among others.

The chart above shows the gold reserves of major gold companies. The VanEck Vectors Gold Miners ETF (GDX) invests in all the above-mentioned stocks. The SPDR Gold Trust ETF (GLD) is the world’s largest physical gold-backed ETF that tracks the price of spot gold.

For more on this topic, read Market Realist’s series, Must-know: Understanding gold price drivers.

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