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Barrick to take smaller, phased approach to Argentina-based Pascua-Lama project

1st September 2016

By: Henry Lazenby

Creamer Media Deputy Editor: North America

  

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VANCOUVER (miningweekly.com) – Major miner Barrick Gold has appointed former executive George Bee to lead the development of a smaller, phased operation at its stalled Pascua-Lama project, straddling the Chile/Argentina border, the company said Thursday.

Barrick had halted the project in 2013 after investing $5-billion in it. As well as permitting issues, cost overruns and a sharp drop in bullion prices, it faced the strong and organised opposition of the local indigenous communities.

Pascua-Lama was originally expected to cost no more than $3-billion when construction was approved in 2009. However, the cost of the project has since escalated to $8.5-billion.

Having previously been employed for 16 years at Barrick, including an eight-year stint in Latin America, Bee as senior VP for Lama and Frontera District Development will from September 12 be tasked with driving forward initial conceptual work completed by the project team to date.

Barrick is looking at advancing a starter project option at Lama, on the Argentinean side of the Pascua-Lama project. The deposit is located on the border between Chile and Argentina, with 75% of the orebody lying in Chile and 25% in Argentina.

According to Barrick, recent evaluation work indicates that a smaller, scalable starter project at Lama, using underground mining methods, may represent the best option to begin a phased development plan for Pascua-Lama. If successful, cash flow from Lama could be used to fund additional development on both sides of the border over time.

The team in Chile will continue to focus on optimising the Chilean components of the Pascua-Lama project, while working to address outstanding legal, regulatory and permitting matters, the company advised.

A 30-year mining veteran, Bee became president and CEO of Andina Minerals before moving on to become CEO at Jaguar Mining after leaving Barrick. While at Barrick, he was intimately involved with the phased development of the Goldstrike mine, in Nevada, the construction of the Pierina mine, in Peru, and development of the Veladero mine, in Argentina.

"Just as the Goldstrike mine was completed in stages over time, we see significant benefits to approaching Pascua-Lama in the same way,” stated Barrick president Kelvin Dushnisky.

As work on a Lama starter option advances, Bee will also start developing an integrated development plan for the Frontera District, a 140-km stretch of highly prospective land on the El Indio belt, controlled by Barrick.

The Toronto-listed shares of Barrick traded nearly 7% higher on Thursday at C$23.56 apiece.

Edited by Samantha Herbst
Creamer Media Deputy Editor

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