Barrick Gold Corporation (NYSE:ABX)(TSX:ABX) shares fell in Toronto on Monday after the company said last night it has agreed to sell its Plutonic gold mine in western Australia to Northern Star Resources for a total of A$25 million.
The deal, which is subject to closing conditions, is expected to close in February.
Shares of Barrick were down over 2% on the TSX on Monday morning, at $17.44.
As of year-end 2012, Plutonic contained proven and probable reserves of 0.2 million ounces, measured and indicated resources of 0.8 million ounces and inferred resources of 1.0 million ounces. The mine produced 86,000 gold ounces in the first nine months of this year, at all-in sustaining costs of $1,110 per ounce, Barrick said.
The divestment comes amid a terrible year for the miner, with 2013 marking a period of write-downs, cost overruns and a shareholder rebellion over executive compensation, most notably co-chair John Thornton's multi-million dollar signing bonus amid a cratering gold market.
Earlier this month, the gold giant announced a series of high level personnel changes, starting with news that founder and chair Peter Munk is to step down from the Toronto-headquartered miner’s board of directors next year at the gold giant’s annual meeting of shareholders. Thornton, Munk’s co-chair since 2012, will attempt to fill the 86-year-old’s shoes, taking over the position of chairman effective as of the same meeting, likely to occur in late April.
That meeting is also to see two other directors -- Howard Beck and ex-PM Brian Mulroney, both Barrick veterans – step down from the board in favour of new faces. The board has put forward four names for election as independent directors at the 2014 AGM -- Ned Goodman of Dundee Corp., Nancy Lockhart of Frum Development Group, former University of Toronto president David Naylor and Ernie Thrasher, CEO of Xcoal Energy & Resources – in a move that will change the mix to 10 independent directors and four non-independent directors.
The company also appointed James Gowans, ex- of DeBeers Canada, to the role of executive vice president and chief operating officer in late January of the New Year.
Shareholder disquiet was certainly at the root of all the reforms, which also installed a new pay-for-performance executive compensation plan scheduled to take effect as of next year's AGM.
Barrick has seen its shares price tumble almost 50% so far this year as gold is set to post its first annual loss since 2000. Falling commodities prices have hit the world's leading gold producer hard, as they have done to miners across the industry. Costs that have spiraled out of control over the decade-long bullion boom proved unsustainable in a lower-price environment.
Last month, the company said it was suspending construction at its Pascua-Lama mine that straddles the Chile-Argentina border as a means to conserve cash and reduce capital costs for next year by up to another $1.0 billion.