Barrick’s Goldstrike mine in Nevada.
Barrick Gold Corp. has appointed a president in charge of China, an area where the miner's chairman has been trying to cultivate a relationship to lead to new business ventures.
Woo Lee, who has close ties to Barrick chairman John Thornton, served as a U.S. State Department representative in Asia for about 15 years.
"It is important that we have a permanent presence in the region," Barrick said in an e-mailed statement. "Woo will be Barrick's representative on the ground."
Mr. Lee is the latest in the series of hires Mr. Thornton has made since becoming Barrick's chairman in April, including the taking on of a former British military commander to serve as chief of staff.
Barrick also reported a weaker third-quarter profit due to lower gold prices and sales. But the world's biggest gold producer said its efforts to reduce costs have started to pay off.
Toronto-based Barrick said it cost $834 (U.S.) to produce an ounce of bullion in the three months ended in September, compared with $914 last year. It lowered the total costs of production for 2014 to between $880 and $920 from a previous forecast of between $900 and $940.
With the precious metal price having fallen close to $1,200, margins for miners have been squeezed.
Like the rest of the gold industry, Barrick is looking for more ways to reduce costs. The miner has already cut jobs, suspended projects, sold mines, reduced debt and scaled back output. Earlier this year it unsuccessfully tried to merge with rival Newmont Mining Corp. to consolidate operations in Nevada.
But its stock price continues to fall as gold prices languish. Barrick has lost 25 per cent this year, trading at a decade low of $14.34 (Canadian).
Barrick's board, where half of the directors are new, is in the process of hammering out the miner's new strategy.
The company has gone through unprecedented change over the past year. Its management team, board and executive compensation plans have been overhauled. Veteran employees have departed.
Barrick said it earned $125-million (U.S.) or 11 cents a share in the third quarter, compared with $172-million or 17 cents last year.
Excluding foreign currency losses and other items, the miner earned $222-million or 19 cents a share. Analysts had expected the company to earn 18 cents.
It is unclear what Barrick will do with one of its major copper mines, Lumwana. The Zambian mine was already a problem for Barrick, which recorded a $4-billion writedown on the asset. Today, Barrick and other mining companies are locked in a battle with the African government over higher royalties, a policy that was thrown further into flux with the death of the Zambian President this week.
The royalty rate was expected to increase to 20 per cent from the current 6 per cent – a move that Barrick said "would challenge the economic viability of the mine."
Rachelle Younglai