MELBOURNE – Barrick Gold’s stake in the Kalgoorlie Super Pit mine has drawn interest from Kinross Gold and Zijin Mining Group in a sale that could fetch as much as $1-billion, people with knowledge of the matter said.

Australian producers  Newcrest Mining, Northern Star Resources and Evolution Mining are also reviewing data on the mine ahead of possible indicative bids, which are due by the end of October, according to the people. Chinese companies including China National Gold Group and Shandong Gold Mining are also considering offers, the people said, asking not to be identified because the details are private.

Gold producers have been reining in costs and selling assets after prices dropped for three straight years. Barrick, the world’s largest gold miner, continues to seek asset disposals even as a price surge this year helped spur its highest profit since 2013.

The Toronto-based firm announced plans to sell the 50% stake in the mine in July and hired Credit Suisse Group to advise on the sale. Its joint venture partner Newmont Mining, the mine’s operator, has signalLed it would be willing to buy the stake at the right price. Barrick President Kevin Dushnisky said last month the company expects a competitive auction for the Super Pit and that initial indications were “very positive".

Barrick is considering various ways to structure the sale, according to the people. One possibility involves selling shares in the holding company that owns the mine, which would not include a right of first offer for Newmont and thus would allow other buyers to potentially acquire the stake, the people said.

OPENPIT
Newmont will “participate in the process", and as operator of the asset it has improved the mine’s production and costs, spokesman Omar Jabara said in a mobile-phone text message. The partners in the joint venture agreed last April to changes in the site’s management under which Newmont assumed greater responsibility.

Spokesmen for Barrick, Kinross, Newcrest, Northern Star and Evolution declined to comment. Zijin, China National Gold and Shandong Gold didn’t answer calls to their offices and e-mails seeking comment during a public holiday in China.

The asset, known as the Super Pit, is 3.5 km long and ranks as Australia’s largest openpit gold mine, its website shows. It’s located in Kalgoorlie, a city in Western Australia where the metal has been produced continuously since a late 19th-century gold rush.

Barrick last year sold the Cowal mine in Australia to Sydney-based Evolution for $550-million and a 50% stake in the Porgera mine in Papua New Guinea to Zijin. The company said in July it would divest other non-core assets including the Lumwana copper mine in Zambia, a 64% interest in African gold producer Acacia Mining and its remaining holding in Zaldivar.

Gold bullion for immediate delivery has risen 19% this year to $1 258/oz as demand for the metal as a store of value climbed on global economic-growth concerns. The metal fell this week to the lowest in almost four months after US jobs data strengthened the case for an increase in interest rates in December.