TORONTO – Barrick Gold Corp. (TSX:ABX) said Thursday it has signed two deals worth a total of US$720 million to sell several non-core assets in Nevada.
Kinross Gold Corp. (TSX:K) will pay $610 million for the Bald Mountain gold mine and a 50 per cent stake in the Round Mountain gold mine in a move that will consolidate its ownership of the project.
The gold miners have also agreed to form a 50-50 joint venture that will own a large land package on the Bald Mountain property.
The second agreement will see Barrick sell its 70 per cent stake in the Spring Valley project and its 100 per cent stake in the Ruby Hill mine to subsidiaries of Waterton Precious Metals Fund II Cayman LP for $110 million.
Barrick has been selling assets in a move to reduce its debt.
The deals Thursday bring its total asset sales, joint ventures and partnerships to $3.2 billion for this year.
“The sale of these assets is consistent with our strategy to create long-term value for our shareholders by strengthening the balance sheet and further focusing our portfolio on core mines that will drive free cash flow growth,” Barrick president Kelvin Dushnisky said in a statement.
The gold miner said it is on track to meet its debt reduction target of $3 billion for this year.
Kinross has mines and projects in the United States, Brazil, Chile, Ghana, Mauritania, and Russia.
The gold miner said its deal with Barrick will add about 430,000 gold equivalent ounces in annual production over the first three years and is expected to lower costs.
“This strategic transaction represents a rare opportunity to add quality, free cash flowing assets that build on our platform in Nevada,” Kinross chief executive Paul Rollinson said.
“We see a clear path to upside at both assets, with known mineralization extensions throughout the Bald Mountain land package and ongoing operational and continuous improvement initiatives at Round Mountain.”
Both deals are subject to customary closing conditions.
The Waterton agreement is expected to close by the end of the year, while the Kinross deal is expected to be completed by mid-January.
