Barrick Gold's Mark Bristow is looking for a takeover as rival Newmont tries to push through a mega-deal, predicting a market rally in two of his company's key commodities.
The fiery chief executive of the world's second-largest gold mining group expects gold and copper prices to rise, which will lift mining stocks.
Newcrest granted industry leader Newmont a specific period to conduct due diligence, which expires next Thursday.
Bristow dismissed concerns about dealmaking at a time when the price of gold, which has topped $2,000 per troy ounce, is hitting an all-time high.
The copper asset is fiercely sought by many mining companies due to an anticipated demand surge due to the switch to electric cars, wind farms and transmission cables, although prices have tumbled since January on a disappointing return to China.
Bristow said that “there are significant upside risks to the price of gold and the price of copper” for both from decreased supply and the strengthening of the US dollar, as well as central banks holding gold in their reserves in exchange for the greenback against the dollar. Reasons for change to diversify. precious metal.
Still, Bristow has ruled out at this stage bidding for Canada's Minor Tech Resources base metals business, which could be spun off. Tech Resources was the target of a $23 billion hostile bid from London-listed Glencore.
Copper prices in markets have fallen nearly 10 per cent to around $8,500 a tonne since January after optimism evaporated over China easing its zero-Covid policies.
However, mining officials and traders warn that historically low levels of inventories increase the risk of year-end price hikes.
In the case of gold, the sector is considered ripe for consolidation because it is relatively fragmented and companies have fallen out of favor in the past with investment decisions.
Barrick's gold production fell to 952,000 ounces in the first quarter, down from 990,000 a year earlier, due to planned maintenance at its processing plant at gold mines in Nevada and the start of plant commissioning at Pueblo Viejo in the Dominican Republic. This contributed to a reduction in adjusted net income by nearly half to $247 million.
Barrick is looking to grow its copper business by developing the Reko Diq in Pakistan's Balochistan province, which borders Afghanistan, while focusing on exploration in the US, Saudi Arabia and Egypt.
It reached an agreement in late March to reopen the Porgera mine in Papua New Guinea, where production has been suspended since 2020 following a dispute with the government.