African Barrick Gold Plc, Tanzania’s biggest gold producer, expects mining costs to fall further as a new chief seeks to turn around the company’s fortunes.
“Expect the trend to continue,” Chief Executive Officer Brad Gordon said today in London. So-called all-in sustaining costs may fall to about $1,100 an ounce this year from $1,362 in 2013 and drop to $1,000 an ounce in a couple of years, he said.
African Barrick today reported its first annual rise in production since it was spun off from Toronto-based Barrick Gold Corp. in 2010. Gordon was appointed CEO in August after the shares slumped 73 percent under his predecessor. The company is reviewing operations and seeking to cut costs after being dogged by operational setbacks.
Gold production in 2013 rose 2.5 percent from a year earlier to 641,931 ounces, beating the 600,000 ounce target, the company said.
The stock rose as much as 7.2 percent to 215 pence and was trading at 214.9 pence at 9:24 a.m., the second-best performer on the FTSE All-Share Index.
When African Barrick listed in London, it targeted annual production of 1 million ounces in 2014. Instead, it posted output declines for three straight years and was surpassed by rivals Randgold Resources Ltd. and Petropavlovsk Plc.