Barrick

Barrick Gold Corporation

Annual Report 1996

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 Barrick Gold Corporation entered gold mining in 1983 and now

has reserves of over 51 million ounces. It remains the world’s

most profitable gold company and is the second-largest producer,

with annual production of more than 3 million ounces. Barrick

has 11 producing mines in the United States, Canada and

Chile. It has two new mines in development which are expected

to produce close to 1 million ounces annually. Barrick is the

leading gold miner in most of the areas in which it operates.

2 1996 Performance Highlights 51 Consolidated Financial Statements

4 A Word to Our Shareholders and Notes

10 Corporate Objectives and Strategies 65 Management Responsibility

Statement and Auditors’ Report
12 Global Development Program
66 Supplemental Information
18 Review of Operations
68 Mining Terms
32 Corporate Responsibility
70 Shareholder Information
34 Technology
72 Board of Directors
36 Reserve, Operating and Financial
All dollar amounts in this report are Information by Mine 73 Corporate Governance
expressed in United States dollars, unless 42 Management’s Discussion 74 Officers
otherwise indicated. and Analysis

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 1996 has proven
to be another
milestone year.
At no time since it was founded

has Barrick been in a better position

to create value for its shareholders.

Barrick has a clear, focused strategy

for growth, plus the people and the depth of financial

resources to implement it. Barrick’s growth stresses

profitability for each ounce of gold produced, thus

enhancing the return on capital deployed.

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 1 9 9 6 P e r f o r m a n c e H i g h l i g h t s

FINAN CIAL HIGH LIGHTS 1996 1995 %

(millions of US dollars) Change
Revenue from gold sales $ 1,299 $ 1,281
Net income 218 292 -25
Operating cash flow 463 502 -8
Cash 245 284
Shareholders’ equity 3,501 2,948

Net income per share (fully diluted) $ 0.60 $ 0.82 -27

Dividends per share 0.14 0.12 +17

O PE RATIO NAL HIG H LIGHTS

Gold production (thousands of ounces) 3,149 3,141
Cash operating costs per ounce $ 193 $ 180 + 7

G O LD RESE RVES AND MIN E RALIZATIO N

(thousands of ounces)
Reserves: proven and probable 51,117 36,539 + 40

Gold mineralized material 24,914

Gold Net Income Operating Cash

Production per Share Flow per Share

(millions 3.1 3.1 (US dollars) (US dollars)

of ounces)
0.82
0.80 1.42
0.74
0.70 1.28
1.22
2.3
0.61 1.11
0.60*
1.00

1.6

1.3

92 93 94 95 96 92 93 94 95 96 92 93 94 95 96
* after one-time charge

2 B a r r i c k G o l d C o r p o r a t i o n

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 F i n a n c i a l H i g h l i g h t s

51.1
(millions of ounces)

37.6
36.5

28.4

25.7

92 93 94 95 96

Reserves Increase 40%

A Position of Strength

Proven and probable reserves rose to

51 million ounces, largest in the Americas.
Gold mineralized material reported
for the first time, adding an additional
25 million ounces.

Gold production is expected to exceed

3 million ounces in each of the next two
years, then to rise.

The lowest cost major producer, at $193 an

ounce versus western world average of $269.

B a r r i c k G o l d C o r p o r a t i o n 3

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 Building Tomorrow’s Barrick
A Word to Our Shareholders

I n 1996, Barrick again showed why it stands out among its

peers – in performance, operations and development experi-
ence, technology, management, track record, and financial strength.
In 1996, we increased our reserves a dramatic 40%, to over
51 million ounces. We also identified 25 million ounces of additional
resources. We maintained our ranking as the most profitable gold
company in the world, generating net income of US$218 million
and operating cash flow of US$463 million. No other gold company
makes more money for its shareholders than Barrick does. This
financial performance reflects the quality of our low-cost mining
operations combined with sophisticated financial management
that includes our unique hedging program.
In 1996, we produced 3.15 million ounces of gold, the second-
highest production rate in the world. At US$193 per ounce, our
cash operating costs are one-third lower than the western world
average of US$269. On our 1996 gold sales, we realized a US$27
an ounce premium over the spot gold price, or US$84 million in
additional revenue and more than US$60 million in extra earnings.
In 1996, with the acquisition of Arequipa Resources Ltd., we
acquired Pierina and 47 other promising new properties in Peru.
We also opened the new Meikle Mine, the largest underground
gold mine in the United States, on time and on budget. We also
put two mines, Pierina and Pascua, into development mode.

4 B a r r i c k G o l d C o r p o r a t i o n

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 A W o r d t o O u r S h a r e h o l d e r s

In 1996, net income per share was US$0.60, compared to

US$0.82 per share in 1995. This was due to a one-time US$0.10 per
share development charge taken on the Cerro Corona project
in Peru, higher operating charges, and increased exploration and
development expenses to fund our expansion.
In Indonesia, our discussions with Bre-X Minerals Ltd. and its
partners did not culminate in an agreement. In the end, our firm We have a
adherence to the financial disciplines that have worked for us so
well over the years led us to withdraw from this project. It was our clear and focused
conclusion that the kind of opportunity available to us would not
be in the interests of our shareholders, nor would it be consistent
strategy for
with our established company policies. Barrick remains interested
dynamic growth
in Indonesia and will continue exploratory work on the significant
land position that we have already assembled. as well as
After a year such as 1996, I feel comfortable in assuring you
that Barrick is in as good a position as ever to create value for the resources to
shareholders. We have a clear and focused strategy for dynamic
implement it.
growth as well as the resources to implement it.

What is Tomorrow’s Barrick?

Our goal is the same as it was the day we entered the gold business
14 years ago: to create value for our shareholders through tangible
achievements. We plan to duplicate our North American success at
the global level by adding quality reserves while maintaining our
low operating costs.

B a r r i c k G o l d C o r p o r a t i o n 5

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 A W o r d t o O u r S h a r e h o l d e r s

How will we achieve this goal?

We are creating growth by integrating our acquisitions capability

From Camflo with our skill at exploration and development. In this comple-
mentary relationship, one component reinforces the other, making
to Mercur, both more effective. South America provides two outstanding
examples of the success of this approach. Our exploration work in
to Goldstrike,
Peru enabled us to recognize the potential at Pierina and make

to Lac and the Arequipa acquisition, while in Chile, our post-acquisition

exploration at Pascua, the former Lac property, has increased
now Arequipa, reserves fivefold to 10 million ounces. Combined, Pascua and
Pierina should add close to one million ounces of low-cost annual
Barrick has
production by the year 2000.
From Camflo to Mercur Mine, to Goldstrike, to Lac Minerals
established a
in 1994 and Arequipa in 1996, Barrick has established a unique
unique pattern pattern of acquisition success in an industry where exploration
had been the traditional way to grow. With each new acquisition
of acquisition we have added significantly to our gold reserves globally and
per share issued. Our skills as mine developers and operators are
success in an
key factors in our acquisition successes.

industry where What resources do we bring to our task?

Barrick is highly entrepreneurial and performance-oriented,

exploration has
combining aggressive operations with conservative financial
been traditional. policies. The same drive, commitment, and enthusiasm that created
the company exist at Barrick today. From head office to mine
operations and exploration teams in the field, Barrick relies on

6 B a r r i c k G o l d C o r p o r a t i o n

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 A W o r d t o O u r S h a r e h o l d e r s

the teamwork and quick decision-making of our people. They

have come to Barrick and they stay because we offer them the
greatest challenges and rewards in the industry. One of our greatest
assets is our habit of success.
Barrick people not only understand the value of the assets Barrick’s
acquired; they also have the ability to maximize their potential.
We have an exceptional record of bringing in new projects on financial
schedule and on budget, time after time. For example, in September
1996, the major Meikle Mine opened as the largest underground
capabilities
mine in the United States. Discovered and built by Barrick people,
constantly
it is one more confirmation of our ability to develop and operate
the most efficient gold mines in the world, using and enhancing improve our
the right technologies to extract more gold, more profitably.
Finally, and most important: Barrick’s financial capabilities performance
constantly improve our performance and maximize returns for
our shareholders. Strengths like hedging and financial structuring
and maximize
provide all the flexibility and leverage needed to undertake
returns for our
the most ambitious projects. Over the past two years, Barrick has
generated close to US$1 billion in cash flow. The Company has shareholders.
US$500 million available under its US$1-billion revolving credit
facility, the largest cross-border credit facility ever put in place by
a mining company. Barrick’s debt-to-equity ratio is a low 0.18 to 1,
even after the Arequipa acquisition. We have the best international
credit rating of any gold company and highly liquid shares, giving
us access to capital at its lowest cost.

B a r r i c k G o l d C o r p o r a t i o n 7

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 A W o r d t o O u r S h a r e h o l d e r s

What lies ahead in 1997?

In 1983, we envi-
Despite some turbulence, I am bullish as to the basic trends of
gold supply and demand. In the shorter term, a number of factors
sioned a company
seem to be constraining gold price, such as a strong stock market,
that would produce low inflation, a strong US dollar, and the threat of central bank
selling. In the long term, however, demand is gaining momentum,
outstanding returns for both demographic and economic reasons. The population of
the western world is aging and accumulating assets, while people
while safeguarding
in other parts of the world are now beginning to experience the

their exposure affluence already achieved in North America and Western Europe.
Despite localized setbacks, the world as a whole is becoming a
through highly much wealthier place. As people and nations accumulate wealth,
they become important new consumers of gold. This is a funda-
disciplined mental trend that I consider so important for gold.
Whatever the short-term price scenario, Barrick remains in an
financial practices.
excellent position, thanks to our hedging program. Over the past

Today, our resources nine years, our hedging program has yielded US$500 million in
extra revenues. At year end 1996, we had just over two years of
are much greater; production hedged. As a result, we expect to be delivering gold at
about US$420 an ounce in 1997, a premium of about US$60 per
our vision remains
ounce over the current price.

the same.

8 B a r r i c k G o l d C o r p o r a t i o n

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 A W o r d t o O u r S h a r e h o l d e r s

John K. Carrington will play an important role in helping us

achieve our goals. Appointed President and Chief Operating Officer
and a member of Barrick’s Board of Directors, he is exceptionally
well qualified to lead the Company’s worldwide operations and
mine development.
Robert M. Smith, our President since 1987, becomes Vice-
Chairman as of this year and will focus on Barrick’s strategy for
growth. Bob has been my valued partner in building Barrick,
and I am delighted that we will continue to benefit from his
experience, industry knowledge, and sound judgment.
In 1983, when we created Barrick, we envisioned a company
that would produce outstanding returns for our shareholders,
while safeguarding their exposure through highly disciplined
financial practices. Today, our resources are much greater and our
world has grown much larger. Our vision remains the same.

Peter Munk
Chairman

February 28, 1997

B a r r i c k G o l d C o r p o r a t i o n 9

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 Beyond Expectations
Corporate Global Development and through the acquisition of
1996 Objective a solid portfolio of exploration
Objectives
Accelerate growth in its asset properties. In 1996, Barrick
Each year, Barrick sets base through an entrepreneurial will commit over $100 million

development program focused to exploration alone, half of

specific objectives
on acquiring multi-million ounce it earmarked for new projects.
and then measures its gold deposits. 1996 Performance

performance against 1996 Performance Barrick increased its reserves by

40% to 51 million ounces of proven
those objectives. In In August 1996, Barrick acquired
and probable reserves during 1996.
Arequipa Resources, including the
1996, the focus of the This increase is directly tied to
key Pierina deposit and 47 other
the Company’s acquisition strategy
Company’s objectives early-stage properties throughout
with most of the new reserves
Peru. Pierina is now in the mine
was long-term growth resulting from Barrick exploration
development stage and expected
of the Pascua Property, acquired
through global expansion. to contribute an additional 500,000
in 1994, and the Pierina Property,
ounces of gold a year by 1999.
Here is how Barrick acquired in August 1996. At
Also in 1996, Barrick explored the
Pascua, reserves increased fivefold
performed against its possibility of becoming the oper-
to 10 million ounces, while inten-
ator at the huge Busang project
1996 objectives sive drilling at Pierina allowed
in Indonesia. After a great deal the Company to bring an initial
and its goals for 1997. of effort throughout the year, 6.5 million ounces into reserves
Barrick was unable to strike a within four months of acquisition.
deal that would have been consis-
tent with those fundamental Production
business principles that guide us 1996 Objective
and have served us so well in the Produce 3.2 million ounces and
past. Barrick has significant explo- increase profitability and cash flow
ration land positions and remains from our mines. Provide a solid
very interested in Indonesia. base in 1996 for production growth
through the balance of the decade.
Reserves
1996 Performance
1996 Objective
Barrick maintained production at
Increase reserves through explo- the same high level as 1995. Pro-
ration around existing properties duction will increase substantially

10 B a r r i c k G o l d C o r p o r a t i o n

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 C o r p o r a t e O b j e c t i v e s a n d S t r a t e g i e s

as new mines at Pascua and In 1996, the Company’s 1997 Objectives

Pierina are brought on stream Canadian mines made excellent Growth in reserves
beginning in late 1999. In 1996, progress, while the mines in the Barrick will continue to
higher operating costs and United States as a whole kept aggressively build its asset base
increased exploration expense cost increases to a minimum. The through an effective program
caused a reduction in profitabil- Chilean operations were faced of acquisitions and exploration.
ity and cash flow. However, with higher costs but programs
Barrick remains the world’s most Growth in production
were implemented to improve
profitable gold company, with efficiency and performance. Barrick is committed to main-
the strongest cash flow and the taining its 3-million ounce plus
lowest production costs of any People level of production and continu-
major gold producer. ing with its development plans
1996 Objective
which will generate a significant
Continue to develop the Company’s
Costs increase in low-cost production
human resources, through the
1996 Objective by the end of the decade.
conviction – proven by past expe-
Implement a plan to reduce the Growth in cash flow
rience – that involved, well-treated
Company’s total operating costs
employees will work with skill Barrick aims to increase
by 10% over the next three years.
and extra dedication to achieve profitability and cash flow by
1996 Performance Barrick’s goals. improving operating margins
Barrick recognized in 1995 that, through lower costs and a
1996 Performance
while it is the industry’s lowest- higher realized price from its
Barrick has cultivated a work-
cost major producer, costs at some gold hedging program.
ing environment that attracts
of its mining operations were Growth in employee
the best people in the business.
forecast to increase over time. In expertise
Through 1996, this world-class
keeping with its objective of team achieved some outstanding Through ongoing motivation,
maximizing profit per ounce, the successes. Among them were the caring and training, Barrick will
Company introduced a long- enhance its employees’
acquisition of Arequipa Resources,
term cost containment program. effectiveness and creativity.
a significant increase in reserves
Its purpose is two-fold: to at Pascua, the opening of the
reduce costs where possible and Meikle Mine, a near doubling of
to ensure in areas of rising costs
production at the Holt-McDermott
that the increase is the very Mine, and the receipt of two
least possible. The plan is already
environmental awards.
showing tangible results.

B a r r i c k G o l d C o r p o r a t i o n 11

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 B a r r i c k G o l d C o r p o r a t i o n

Building
Tomorrow’s Barrick
Global Development Program

12 B a r r i c k G o l d C o r p o r a t i o n

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 G l o b a l D e v e l o p m e n t P r o g r a m

I n assuring its future, Barrick

must continue to build
reserves and increase produc-
the development of the
Pierina Mine as a result of this
acquisition and increased
Barrick has
tion – and do so in the focused, reserves fivefold at the Pascua
entrepreneurial, cost-effective Mine. They are scheduled to
announced the
way that has always marked its enter production in 1999 and
record of growth. The Company’s 2000, respectively, and will begin
Pierina Mine Project
development program is its con- to have important impact on
tinuing, and successful, response Company production at that as a result of the
to this challenge. time. During 1996, Barrick also
The program is a powerful added to its significant base Arequipa acqui-
combination of two elements: of properties in its regions of
acquisition and exploration. geographic concentration. sition, and increased
Barrick will continue to grow
THE PIERINA MINE PROJECT
largely through its ability to reserves fivefold at
acquire highly prospective, multi- Pierina has already shown
million-ounce assets, and then itself to be a very exciting mine Pascua. These two
use its exploration and develop- project. Upon acquisition
ment expertise to maximize in August, 70 holes had been
mines illustrate
their potential. Pure exploration drilled on the property. By year
is a vital part of the strategy as end, just four months later, the
the effectiveness
well. Barrick’s on-the-ground Company had drilled another
presence in selected areas of the 201 holes, brought an initial
world provides the potential 6.5 million ounces of gold into
of interrelating
for discovering new deposits, as reserves and identified a further
well as timely and knowledge- 764,000 ounces of gold miner-
Barrick’s acquisition
able assessment of acquisition alized material.
opportunities. This is a preliminary number and exploration
The Company took major and does not indicate Pierina’s
steps during 1996 to assure future full potential. It is the result of a programs.
growth. It acquired Arequipa concentrated effort to quantify
Resources in August, announced reserves during the initial drilling

➢
Analyzing a core sample at one of Barrick’s South American exploration sites.

B a r r i c k G o l d C o r p o r a t i o n 13

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 G l o b a l D e v e l o p m e n t P r o g r a m

T H E PA S C U A M I N E P R O J E C T
period, rather than property-wide operating costs are expected
exploration. The drill program to be well under $100 per ounce. During 1996, Barrick’s explo-
continues and the deposit is still This low figure is due in part ration program at Pascua added
open to the east and south. to a credit from the significant 8.1 million ounces to reserves,
Preliminary planning suggests silver mineralization in the for a deposit total of over 10 mil-
this Mine will produce at an deposit (which is not included lion ounces. In addition, there
annual rate of 500,000 ounces in Company reserve or gold min- are 6.7 million ounces of gold
of gold, beginning in late 1999. eralized material calculations). mineralized material. The Pascua
The early estimate of construc- A detailed feasibility study for deposit is still open at depth
tion costs is $200 million, and the Mine is now underway. and to the east and south. Work

United States
Canada

China

Philippines
Brazil

West Africa
Peru Indonesia

Chile
Argentina

Principal areas of exploration

Identifying Opportunities Worldwide

Pure exploration is focused on selected regions of four continents.
It targets deposits with at least 3 – 4 million ounces, the potential
for expansion, and the ability to provide substantial financial returns.

14 B a r r i c k G o l d C o r p o r a t i o n

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 G l o b a l D e v e l o p m e n t P r o g r a m

is continuing on a tunnel through

the lower portion of the deposit
to explore the deposit’s potential.
Over 1,800 metres have been
completed in the tunnel thus far.
Results confirm the extension
of the ore to depth as well as the
continuity and tenor of the
ore between drill holes. Work is
now underway from an old adit
another 300 metres below this
tunnel, which also indicates that
the deposit extends to this level. Workers guide a drill during night operations at the Pierina Mine. Within four
months of the Arequipa acquisition, Barrick drilled 201 holes to bring an initial
Approximately $11 million will be
6.5 million ounces of gold into reserves.
spent in 1997 to expand reserves
at Pascua.
Pascua is planned to be devel- Exploration on Goldstrike Property, 9.7 million
oped as an 18,000 tonnes-per- Existing Properties on the El Indio Belt in Chile
day mill, to produce an average This year, for the first time, and another 2.7 million at the
of 400,000 ounces of gold a year Barrick is reporting a gold min- Canadian operations. During
for a minimum of 20 years. eralized material category in 1997, the Company will spend
Capital costs are expected to be addition to proven and probable over $50 million on exploration
in the $500-million range for reserves, which allows the to delineate this mineralized
the initial project to handle the Company to provide an indica- material more fully in order to
oxide material. In subsequent tion of the work being done to increase the Company’s reserves.
years, when sulphide material increase reserves on its proper- It will also look for other areas
becomes available, the plant will ties. Barrick enters 1997 with of interest in and around existing
be expanded to include a 10,000 25 million ounces of gold properties. (Information about
tonnes-per-day parallel sulphide mineralization in addition to specific programs is contained in
processing circuit. As well, a its 51 million ounces of reserves the mine descriptions in the
separate heap leach circuit for – a strong indication of the Operations section of this report.)
the low-grade material is being considerable potential yet to be
considered. Cash operating realized on its existing assets. Pure Exploration
costs are now anticipated to be Of this mineralization total, Barrick continues to strengthen
about $220 an ounce. 11.6 million ounces are on the its longer-term exploration

B a r r i c k G o l d C o r p o r a t i o n 15

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 G l o b a l D e v e l o p m e n t P r o g r a m

identified a significant gold/cop-

per resource. However, Barrick
decided not to proceed further
with the Cerro Corona project,
since it did not meet Company
criteria for return on investment.
In Argentina, an 8,000-metre
drill program on the Diablillos
Property continues to meet with
encouraging results. Work is
underway to increase the resource
at the Oculto Zone.
In Indonesia, where Barrick
has a land position of 8.8 million
At Pascua, 1996 drilling added 8.1 million ounces to reserves, for a total of over
hectares, mapping and sampling
10 million ounces, and identified 6.7 million ounces of gold mineralized material.
are underway on the Woyla Prop-
erty in northern Sumatra, on
programs in North and South In Peru, Barrick acquired the Masupa Ria and Yamana pro-
America (notably Peru, Argentina the right in August to explore and jects in Kalimantan and on several
and Chile) and Indonesia. mine the Quicay gold project, Irian Jayan properties as well.
In December 1995, Barrick with mineralization of one million Drilling will commence in 1997
acquired a 40% interest in the ounces. An initial 6,000-metre on both Woyla and Masupa Ria.
Newmont/Barrick HD Venture drilling program is underway. The Company spent $139 mil-
(formerly High Desert), a Quicay appears to have the same lion on exploration in 1996
prospective property adjacent to geological signature as Pierina. and an additional $20 million
Goldstrike on the Carlin Trend. In addition to Pierina, the on equity investments in junior
Newmont Gold Company, with Arequipa purchase brought gold exploration companies.
60% ownership, is project opera- Barrick 47 early-stage properties The 1997 budget is $100 million,
tor. Three significant mineralized throughout Peru, totalling divided equally between exist-
zones have been discovered to 180,000 hectares. A number of ing operations and new projects.
date, and the 1996 drill program these properties are located With its healthy and strong
allowed Barrick to include on the Pierina Gold Belt. Barrick balance sheet, Barrick is both
1.2 million ounces in reserves at now has field work underway well positioned to meet these
year end as its 40% share. These on some of these properties. commitments and seize any
reserves are at West Leeville and Barrick completed a feasibility attractive acquisition opportu-
Four Corners. study on the Cerro Corona Project nities that may arise.
based on extensive drilling that

16 B a r r i c k G o l d C o r p o r a t i o n

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 G l o b a l D e v e l o p m e n t P r o g r a m

SE NW
Drill Roads
Pit Boundary

Open to Ore Body

the east

Open to
the south

COLOMBIA

N ECUADOR

Cajamarca BRAZIL

Pierina Ancash
Project

Mines in Development Lima

PERU BOLIVIA
Above: Pierina will produce an estimated 500,000 ounces of
gold a year, beginning in late 1999. The deposit is still open. Moquegua
Tacna
Below: Pascua is expected to produce 400,000 ounces of gold a PA
CIF
IC
OCEA
N
year. The deposit is open both at depth and to the east and south.
CHILE

Pascua El Indio
Chile Project Belt
Argentina ARGENTINA
Santiago

Pit Boundary 0 200 Kilometres

Barrick properties

Pascua
Zone
Esperanza
Zone

B a r r i c k G o l d C o r p o r a t i o n 17

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 Outstanding
Performance
Review of Operations

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 R e v i e w o f O p e r a t i o n s

T wo key aspects in “Building

Tomorrow’s Barrick” are
keeping our mines running effi-
of lowering costs, particularly in
our South American operations.
At the Goldstrike Property, we A key objective
ciently and costs low. Barrick has produced over 2 million ounces
a proven ability of extracting the and more than replaced reserves. as we grow
most value from its mines at the In September, we commissioned
best cost, while meeting strict the high-grade Meikle Mine – the is to continue
development timetables and high largest underground gold mine
environmental and safety stan- in the U.S. – on schedule and on to produce
dards. These operational capabil- budget. Meikle will allow us to
ities have helped to generate produce 2 million ounces a year
quality ounces
consistently strong earnings and from the Goldstrike Property
cash flows, and produced a track into the next century.
Our Canadian operations
– that is, low-
record that has created the kind of
returns our shareholders expect. produced over 500,000 ounces.
The key is not simply to find We are now pleased with these
cost ounces.
and mine gold, but to produce operations: costs are in line and
“quality” – or low-cost – ounces. the mines are performing well.
We did this in 1996 by produc- In Chile, while our production
ing over 3 million ounces of gold, and costs did not meet our tar-
while remaining the lowest-cost gets, we expect that these mines
major gold producer. Although will soon meet our criteria.
we did not achieve low costs In 1997, we expect again to
uniformly throughout our opera- produce more that 3 million
tions, we did, however, make ounces of gold, while reducing
productivity improvements that our costs below our already
should help us achieve our goal low average of $193 an ounce.

O P E R AT I N G D ATA 1996 1995

Gold production (ounces) 3,148,801 3,140,507

John Carrington
Gold sold (ounces) 3,128,941 3,156,419
President and
Cash operating costs (per ounce) $ 193 $ 180 Chief Operating Officer

➢
Large-scale equipment at Betze-Post moves 150 million tons of material a year.

B a r r i c k G o l d C o r p o r a t i o n 19

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 R e v i e w o f O p e r a t i o n s

United States Goldstrike has produced one-third of the gold mined

over 10 million ounces of gold to in Nevada.
Goldstrike Property date and has current reserves With the opening of the Meikle
Betze-Post and of 29.7 million ounces, the single Mine, the Goldstrike process
Meikle Mines largest gold reserve in the United facility is now handling ore from
States. The Betze-Post Mine the Meikle and Betze-Post Mines
It was another landmark year contains 23.6 million ounces of at a nominal rate of 2,000 and
for the 7,000-acre Goldstrike the reserves while the adjacent 15,500 tons per day, respectively.
Property, located on the Carlin Meikle Mine contains 6.1 mil- Meikle production will be given
Trend in north-central Nevada. lion ounces. As well, a further preference in the process facility
Not only was a second mine 11.6 million ounces of gold over Betze-Post ore because of
opened but additional reserves mineralized material have been its higher grade, 0.72 ounces per
were discovered that more than identified on the Property. ton compared with a reserve grade
replaced the ounces mined from The Goldstrike Property holds of 0.19 ounces per ton at Betze-
the Betze-Post Mine in 1996. 58% of Barrick’s total reserves Post. This means that production
Barrick has spent over $1.3 and 46% of its gold mineraliza- from the Goldstrike Property
billion to construct one of the tion. Over 2 million ounces of will continue at a rate of more
world’s largest and most techno- gold are produced annually at the than 2 million ounces a year
logically advanced mining and Property, representing 64% of through the end of the decade.
processing facilities at Goldstrike. Barrick’s annual production and Cash operating costs per ounce
for the Property are expected
to average just over $160 due to
the lower cost production from
Meikle Mine.
The Goldstrike processing
facility consists of a mill and six
autoclaves, handling 17,500 tons
per day of refractory ore. There
are two grinding circuits, each
composed of semi-autogenous
grinding (SAG) and ball mills.
In 1996, Barrick installed
two variable-speed drives for the
SAG mills at a cost of $9 mil-
The Goldstrike Property, looking north from the processing facilities to the Betze- lion to handle harder Meikle
Post pit, middle left, and the Meikle Mine, upper right. The Property produces two ore which requires a finer grind
million ounces of gold a year from these two mines.
for optimum gold recovery.

20 B a r r i c k G o l d C o r p o r a t i o n

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To improve recoveries from the holes and 265,000 feet of drilling

refractory ore, which represents during the year. Proven and Rodeo Shaft
the major part of the Goldstrike
ores, Barrick installed the largest
probable reserves increased by
997,000 ounces on the Goldstrike
Sinking
pressure oxidation or autoclaving Property – after producing
facility for gold in the world. 2.3 million contained ounces – Approximately 4,000 feet
Autoclaving improves gold recov- to 29.7 million ounces. The south of Meikle, construction
ery from less than 30% to more additions to reserves were mainly has begun on the $18-million
than 90% after oxidation. (The in the Screamer area and are Rodeo exploration shaft.
process is described more fully essentially extensions of the The Rodeo deposit was sur-
in the Technology section of Betze-Post ore body. They will face-tested with 62 diamond
this report on page 34.) A small be mined by future expansion drill holes prior to the decision
amount of oxide ore is treated of the existing pit. to proceed with the shaft.
on heap leach pads. An additional 11.6 million The shaft will have a 16-foot
After the year 2000, signifi- ounces of gold mineralized mate- diameter and be sunk to a
cant amounts of carbonaceous/ rial have been identified on the depth of 1,350 feet. It has
sulphide ores will begin to be Property, the majority of which are been collared and sinking will
mined at Goldstrike. Barrick is peripheral to the final Betze-Post/ begin in August 1997. When
considering a number of options Screamer pit plan. The balance completed, this shaft will
for processing this ore, which of this mineralization is within provide access for underground
requires another step to neutralize the Rodeo deposit, lying between delineation drilling of the
its carbonaceous content in order Betze-Post and Meikle. An explo- Rodeo deposit in 1998 and 1999.
to achieve the best gold recoveries. ration shaft has been collared and
One possibility is the traditional sinking will begin this year to
method of roasting while permit underground exploration
another is Barrick’s new patented of this mineralized area.
ammonium thiosulphate process. For 1997, a $10-million drilling
A decision on the most cost- budget has been allocated for the
effective way to process this ore Goldstrike Property. It will con-
will be made by mid-1997, so centrate on the Screamer, North
that processing facilities can be Betze and West Betze areas of the
in place by 2000. pit to further delineate reserves
for the Betze-Post Mine, as well as
Reserves, Gold Mineralized on exploration drilling through-
Material and Exploration out the property, including
A $12.8-million exploration pro- underground at the Meikle Mine.
gram resulted in 160 deep drill

B a r r i c k G o l d C o r p o r a t i o n 21

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Capital Expenditures that time, mining has taken place Mining Company for the con-
In 1996, $123 million was spent through a series of progressive struction of a water discharge and
at the Goldstrike Property, of push-back mining cuts. Under treatment facility on Newmont
which $62 million was spent at the Betze-Post Joint Operating land. Engineering, permitting
the Betze-Post Mine and $61 mil- Agreement, signed in 1992, and construction are underway
lion at the Meikle Mine. In 1997, Barrick, as the operator, also for the facility, which will allow
$113 million is budgeted. mines material from contiguous the discharge of water into the
deposits owned by Newmont Humboldt River system. On com-
BETZE-POST MINE Gold Company. Newmont pro- pletion later this year, Barrick will
The Betze-Post Mine is a con- cesses all its own ore. be able to increase its pumping
ventional open pit shovel and Betze-Post has invested rate, which will allow for deeper
truck operation, using large- $160 million in its mine equip- development of both Meikle
scale equipment to extract ment fleet. Each of the Mine’s and Betze-Post.
about 150 million tons of ore 72 190-ton haul trucks costs
and waste per year. $1.6 million while the four electric, Capital Expenditures

In 1996, the Mine produced 42-cubic yard shovels cost $7 mil- In 1996, $62 million – before
1.9 million ounces of gold at an lion each. The Mine also has two applied stripping – was spent on
average cash operating cost of new 210-ton haul trucks. Truck capital projects at the Betze-Post
$162 per ounce. The grade of the fleet productivity is important, as Mine, primarily for mining
ore processed was 0.353 ounces transportation costs represent equipment, water management
of gold per ton and recovery was 49% of the Mine’s operating costs. facilities in Boulder Valley, and the
90%. In 1997, cash operating costs Two projects – Truck Dispatch and variable speed drives at the pro-
for Betze-Post ore are expected Trolley Assist – have significantly cessing facility. In 1997, $88 mil-
to rise to $175 per ounce, largely reduced transportation expenses lion is budgeted, principally
because grade processed will and enhanced mine efficiency for the construction of the water
be 0.31 ounces of gold per ton. (see the Technology section on discharge and treatment facility,
page 34 of this report). A 300-ton- as well as for mining equipment.
Mining capacity truck is currently
MEIKLE MINE
Since Barrick announced the being tested, which should result
Betze Development Plan in 1989, in even greater productivity. The Meikle Mine, located one
more than one billion tons of Since most of the Betze-Post mile north of the Betze-Post Mine,
material have been moved from ore lies below the original water is a compact, high-grade under-
the pit. Production emphasis has table, the Mine has installed ground deposit which is produc-
shifted from the shallow oxide extensive systems to manage ing about 2,000 tons of ore per
ores to the deeper, higher-grade water levels at its sites. In 1996, day. Meikle began production
sulphide ores, which were first Barrick reached an important in September 1996. The Mine
reached in September 1992. Since agreement with Newmont produced just under 80,000

22 B a r r i c k G o l d C o r p o r a t i o n

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ounces in 1996 at an average cash ventilation shaft. In 1996, 27,000 a variety of ground conditions.
operating cost of $142 per ounce. feet of underground development Both methods require a high-
In 1997, Meikle is expected to were completed, comprising the quality cemented rockfill using
produce 435,000 ounces at the low first phase of mine development crushed and sized aggregate.
cost of $125 per ounce, making it including drifts to the ore body. Underground production
the largest underground gold mine The ore body has two zones: facilities, such as the backfill
in production in the United States. an upper flat-lying zone, which batch plant, the crusher and the
will be mined first, and a deeper, shops, have been commis-
Reserves, Gold Mineralized steep zone, which contains the sioned. The water table has been
Material and Exploration bulk of the ore. lowered to accommodate the
The Meikle Mine has 6.1 million Two different mining meth- first phase of mine development.
ounces of reserves, grading ods are being used: long-hole Further lowering of the water
0.716 ounces of gold per ton. In open stoping for about 75% of table will occur when the dis-
addition, about 1 million ounces the ore reserves; and underhand charge facilities to the Humboldt
of gold mineralized material drift-and-fill for the remainder, River are completed at the
of similar grade have also been primarily in areas of thinner and Betze-Post Mine.
identified. More than 150,000 feet flat-lying mineralization. These Because of high temperatures
of underground definition two methods permit a conser- underground, the largest mine
drilling was carried out in 1996 vative, yet flexible approach to refrigeration system in North
to better define the geometry mining the ore body under America, with a plant cooling
of the upper main zone of the ore
body. This drilling, which was
completed at a cost of $4.3 mil-
lion, confirmed reserves in the
area, and facilitated detailed stope
planning for the next two years of
production. In 1997, Barrick will
continue to explore the deposit
from underground, which could
lead to higher reserves as there
is excellent unexplored potential.

Mining
The Mine has two shafts: an
18-foot-diameter, 1,480-foot pro- At Meikle, an electric hydraulic jumbo prepares to drill a round for blasting in a
duction and service shaft, and development drift. Drifting comprised the majority of the activity in the 1996 devel-
opment program. In 1997, development emphasis will change to stope preparation.
a 16-foot-diameter, 1,320-foot

B a r r i c k G o l d C o r p o r a t i o n 23

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Area of map

Reno
NEVADA
N

Las Vegas

GOLDSTRIKE
PROPERTY

Meikle Mine
Rodeo
N. Betze

Screamer Metallurgical
Betze-Post Complex
Meikle Mine LO N G I TU D I N A L S ECTI O N Mine

W E Newmont /Barrick
West HD Venture
Leeville
Project Area
Four Corners
Production Ventilation
Shaft Shaft Hardie Footwall
0 1 Mile

Ore body Access

Road
Development completed Barrick Goldstrike Property 100%
in 1996 Barrick Deposits
Planned development Barrick Venture Property 40%
Barrick Venture Deposits
Other Gold Deposits

925 Level

1075 Level
The Meikle Mine
1225 Level
Above: Meikle’s surface facilities include
ventilation and production headframes and a
refrigeration plant for underground cooling,
the largest in North America.

Left: In 1997, Barrick will continue to explore

the deposit from underground, which could
lead to higher reserves as there is excellent
0 400 Feet
unexplored potential.

24 B a r r i c k G o l d C o r p o r a t i o n

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capacity of 10 megawatts, was The original Bullfrog open 202,000 ounces of reserves con-
put into operation in mid-1996. pit was mined out by the end of tained in the pit and Golden
The economics of the Meikle 1994. More recently, open pit ore Gate tailings, at an average grade
Mine are especially attractive, has come from two smaller satel- of 0.054 ounces of gold per ton.
not only because of the high lite pits, Montgomery-Shoshone The open pit ore reserves will
grade nature of the ore body, and Bonanza Mountain, the latter be depleted in early 1997, and
but also because of the use of of which was mined out in 1996. mining operations will end. Mill
existing processing facilities on The principal operations are now processing of the tailings from
the Goldstrike Property. Meikle underground, with access from previous mining operations will
ore is hauled by the Betze-Post three portals located within the continue into late 1998, after
fleet of 190-ton trucks to these completed Bullfrog pit. The under- which the mill will close. Leach
processing facilities. ground operation produced at a areas and waste dumps are cur-
rate of 1,480 tons per day in 1996. rently being reclaimed.
Capital expenditures In 1996, production increased 15% In 1996, Mercur produced
The Mine was developed on time to 205,268 ounces at a cash oper- 82,593 ounces of gold at an aver-
and at a budgeted cost of $186 ating cost of $281 per ounce. The age cost of $313 per ounce. In
million, or about $30 per ounce. 1997 production target is 179,000 1997, Mercur is expected to pro-
About $25 million will be spent ounces at a cost of about $295 per duce 58,000 ounces at approxi-
in 1997 on underground develop- ounce; this lower production and mately the same cost because
ment and the shaft sinking higher costs are attributable to of mine department shutdown
at Rodeo. Exploration work will a greater reliance on lower grade and associated costs that will
continue as part of the $10 mil- stockpiled ore in 1997. not be incurred.
lion budgeted for the Property. A $600,000 exploration pro-
PINSON MINE
gram is planned in 1997 to
BULLFROG MINE
focus on developing and drilling Barrick increased its equity
The Bullfrog Mine is an open for Bullfrog-style deposits interest in the Pinson lands in
pit and underground gold mine, within and peripheral to the Nevada to 50% from 26.25% in
located in the historic Bullfrog district. Bullfrog continues December 1996. Pinson, located
mining district, about 125 miles to control all the prospective 200 miles northeast of Reno,
northwest of Las Vegas, Nevada. ground in the district. Nevada, is owned as a joint
The Mine has 628,000 ounces venture interest with Homestake
MERCUR MINE
of reserves, grading 0.062 ounces Mining Company, which is the
of gold per ton, and an addi- Located 35 miles southwest of operator of the existing mine.
tional 147,000 ounces of gold Salt Lake City in Utah, the Mercur This property has excellent deep
mineralized material, grading Mine is one of the earliest exploration potential under
0.04 ounces per ton. mines acquired by Barrick. It has the Pinson and Preble deposits.

B a r r i c k G o l d C o r p o r a t i o n 25

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Pinson Mine has produced about Bousquet Mine was undertaken “Eureka” mining method – a
one million ounces of gold over because of difficult ground con- Bousquet development variant of
its life. It has been operating ditions, high dilution and mining the Avoca sub-level retreat mining
at a rate of 50,000 ounces of gold sequence problems. Barrick method – for ore widths of less
per year over the past five years. decided to shut down Bousquet 1 than 5 metres. The 2,750-tonnes-
Barrick’s share of 1997 produc- and to mine its remaining per-day Est-Malartic Mill, 37 kilo-
tion will be 21,000 ounces. economic reserves through the metres away, processes Bousquet’s
Barrick’s share of remaining Bousquet 2 shaft. The two mines gold-copper sulphide ore.
reserves is 92,000 ounces. were successfully consolidated Total 1997 capital expenditures
in September 1996. are estimated to be $5.5 million
The Mine has 1.1 million for underground development,
Canada
ounces of reserves, grading 0.25 compared with the $6.9 million
Abitibi Belt ounces of gold per ton. An addi- spent in 1996.
tional one million ounces of
DOYON MINE
The Abitibi Belt has been the gold mineralized material, grad-
richest gold belt in Canada for ing 0.186 ounces of gold per The Doyon Mine is an under-
more than 75 years. Barrick ton, have been identified. In 1996, ground mine, located eight kilo-
operates three mines along this exploration of a zone between metres west of the Bousquet
Belt – the Bousquet Mine and Bousquet 1 and 2 was followed by Mine. Barrick operates the mine,
the neighbouring Doyon Mine in a feasibility study. Development which is a 50/50 joint venture
Quebec and the Holt-McDermott work to bring this zone into with Cambior Inc.
Mine in Ontario. A fourth production by 1999 was started Doyon began production
mine, Golden Patricia, is located in November 1996. There is also as an open pit mine in 1980 and
in northwestern Ontario. further potential to increase became a totally underground
reserves at depth and between the operation in 1985. Barrick’s share
BOUSQUET MINE
two mines. In late 1996, a separate of 1996 production was 104,495
The Bousquet Mine is located exploration program was begun, ounces of gold at a cash operat-
between the cities of Val d’Or and which will continue through ing cost per ounce of $218. The
Rouyn-Noranda in northwestern 1997, on a property acquired to Company’s share of expected
Quebec. The original Bousquet the west of Bousquet 1. 1997 production is 110,000
Mine began production in July Bousquet is a trackless mining ounces at a cash operating cost
1979. In 1986, exploration on operation, where most production of just over $200 per ounce.
the eastern side of the property levels are connected by an inter- Barrick’s share of reserves is
led to development of what nal ramp. Two mining methods 948,000 ounces, grading 0.168
was to become Bousquet 2, are being used: modified open ounces of gold per ton. As well,
which opened in 1989. In 1995, stoping with delayed backfill in the the Company’s share of gold
a reassessment of the original massive ore, and a longitudinal mineralized material is 827,000

26 B a r r i c k G o l d C o r p o r a t i o n

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Doyon Mine LO N G I TU D I N A L S ECTI O N

W E
New Shaft West Zone Main Zone

Level 2

Level 8

Level 15

Bousquet Mine LON G I TUDI N AL SECTI ON

W Bousquet 1 Bousquet 2 E

0 500 Metres

Ore body
Development completed
Proposed development
Exploration EXPLORATION DRIFT Level 9
Mined ore
Potential

BOUNDARY
0 500 Metres

Holt-McDermott Mine LO N G I TU D I N A L S ECTI O N

W E
Canadian Mines
Above: At Doyon, the new zone below
the 8th level will come into production in
late 1997. Development is underway
on a new zone between Bousquet 1 and 2
560m Level
SOUTH ZONE
for production by 1999.

775m Level Left: Holt-McDermott’s South Zone

VERTICAL SECTOR
OPEN
still has significant potential to increase
ALTERATION ZONE
OPEN reserves.

0 500 Metres

B a r r i c k G o l d C o r p o r a t i o n 27

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H O LT- M C D E R M O T T M I N E

The Holt-McDermott Mine

is located about 50 kilometres
northeast of Kirkland Lake,
in northeastern Ontario. Reserves
have increased substantially at the
Mine with the discovery of the
South Zone in late 1993. The Mine
contains 731,000 ounces of gold
reserves with an average grade of
0.20 ounces of gold per ton,
and a further 880,000 ounces of
gold mineralized material, grading
Miners prepare underground production drilling rig for stope development at Doyon.
0.149 ounces of gold per ton.
There is still significant opportu-
ounces, grading 0.165 ounces from the 8th level to the 10th nity to expand reserves at the
of gold per ton. There is excellent level, where the key mine work- Mine and a diamond drilling pro-
opportunity to increase reserves. ings have been developed. gram is underway to test the down
The Company is planning to Doyon is a highly mechanized dip potential of the South Zone.
sink a new ventilation shaft to mine, using cost-effective bulk Definition drilling continues to
the west of the existing shaft at mining methods such as trans- delineate ore to the east and west
Doyon, which will also be used verse mining in the Main Zone, of the central core of the zone.
to explore the Mine at depth bulk mining in the West Zone Production in 1996 was 117,621
and to the west. If the exploration and conventional long-hole and ounces, 77% higher than 1995
program is successful, this shaft shrinkage stoping in narrower levels, as the South Zone entered
could also be used for production. veins. A new backfill plant in full production, generating
Exploration drilling three the West Zone and a new fully increased tonnage and improved
years ago determined there were automated loading pocket on grade. Cash operating costs
sufficient reserves below the the 10th level will improve dropped to $160 per ounce from
8th level to justify deepening the mining operations in 1997. The $236 in 1995. For 1997, production
existing shaft. This work was mill, which uses a carbon-in- is estimated at 120,000 ounces
completed in March 1996 and pulp process, has a capacity of at a cost of $140 per ounce.
now lateral development is pro- 3,300 tonnes per day. The primary mining method
ceeding on levels 12 and 14 to Barrick’s share of capital expen- at Holt-McDermott is long-hole
prepare this new sector for mine ditures in 1997 will be $11 million stoping, which has been used
production in December 1997. for underground development, exclusively since production com-
The main ramp is being driven compared with $8 million in 1996. menced there.

28 B a r r i c k G o l d C o r p o r a t i o n

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The mill, which is a conven-

Chile There remains considerable po-
tional carbon-in-leach circuit, tential to find new deposits along
averaged 1,772 tonnes per calen- The El Indio Property the El Indio Belt, with the large
dar day of which 1,199 tonnes per increase in reserves at the Pascua
day were from Holt-McDermott The El Indio Property covers Mine Project in 1996 being one
and 573 tonnes per day were 1,300 square kilometres of the confirmation of this possibility.
from Battle Mountain Canada’s El Indio Belt located along the
EL INDIO MINE
Holloway Joint Venture Mine Continental Divide in the Andes
under a custom milling agree- Mountains in central Chile. It The Mine’s reserves were reduced
ment. This custom milling is a prolific gold, silver and copper in 1996, reflecting a more conserva-
is expected to continue well into district, close to the Argentina tive approach. The ounces removed
the next century. border. The property includes from the proven and probable
Capital expenditures are two producing mines, El Indio category have been included in
estimated to be $3.3 million in and Tambo, located within five gold mineralized material until the
1997, which will include further kilometres of each other in the Company completes underground
development in the South south-central part of the property, delineation drilling which will
Zone as well as exploration to and the Pascua Mine Project begin later this year after comple-
expand reserves. which is under development about tion of the new internal shaft. In
50 kilometres to the north. 1996, production was 169,359
G O L D E N PAT R I C I A M I N E
Reserves at the El Indio ounces, grading 0.172 ounces of
By mid-March 1997, after a life Property total 12.1 million ounces, gold per ton at an average cost of
of almost nine years, the Golden divided among three mining $263 per ounce. Production was
Patricia Mine near Pickle Lake areas. The underground El Indio lower and costs higher than in
in northwestern Ontario will have Mine contains 1.2 million ounces, 1995, but priority was placed on
depleted its economic reserves. the open pit Tambo Mine con- improving mine management,
It has processed 1.14 million tains 0.8 million ounces, while systems and physical plant, and
tonnes of ore and produced nearly the Pascua Mine Project contains in better understanding the ore
635,000 ounces of gold. In 10.1 million ounces. A further body. For 1997, production is esti-
1996, the Mine produced 53,302 11.0 million ounces of gold min- mated to be 140,000 ounces with
ounces and is estimated to pro- eralized material has been iden- a substantial reduction expected
duce 14,000 ounces in 1997. tified, with 4.3 million ounces in the cost per ounce.
The site will be closed by fourth at the El Indio and Tambo Mines. Copper production in 1996 was
quarter 1998, with the cost of In 1996, 328,662 ounces of gold 35,000 tonnes and is estimated to
site closure, employee severance were produced at the Property be about 45,000 tonnes in 1997.
and reclamation estimated to and production of 315,000 ounces The copper provides a significant
be $4 million. is expected in 1997. credit against operating costs
per ounce.

B a r r i c k G o l d C o r p o r a t i o n 29

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 R e v i e w o f O p e r a t i o n s

in highly fractured pillars. By the

end of 1996, the longhole mining
method accounted for about 20%
of the El Indio Mine production.
The primary mining method
used in the Viento area is long-
hole stoping. Barrick is sinking a
490-metre internal shaft which
will be used for both El Indio and
Viento mining operations and
to provide access for exploration
and development at depth. The
shaft is scheduled for completion
A convoy of trucks containing gold/copper concentrate from the El Indio Mine in March 1997.
winds its way through the foothills of the Andes Mountains to the coastal town of
La Serena for shipment to smelters.
Processing
Facilities include a flotation
Exploration Mining
plant and three roasters. A series
Exploration drilling programs The three ore sources – the
of productivity improvements
within the El Indio Mine El Indio Mine itself, the adjacent
in the concentrator and the
have focused on the northeast Viento system and the Rio
roasters over the past two years
extensions to the Indio and del Medio deposit – are vein type
have increased plant capacity
Viento structures, and ongoing deposits. The Rio del Medio
at El Indio by approximately 13%
exploration for high-grade deposit, a gold/silver deposit, will
to 3,250 tonnes per day and
extensions in the upper section be depleted in early 1997 and
improved the quality of the prod-
of the Mine. There have been replaced by a copper/gold vein
uct. While throughput averaged
promising results in both pro- in the El Indio Mine, known as the
2,900 tonnes per day in 1996,
grams, with the Viento northeast Mula Muerta Sur vein. The ores
it is projected to be 3,250 tonnes
extension providing high-grade are complex copper sulphides
per day in 1997. Over 70% of
intercepts. The 1997 in-mine containing high levels of gold
the concentrate is roasted on site,
exploration program will provide and silver. A number of mining
with the balance being done at
over 20,000 metres of additional techniques have been applied
outside smelters.
diamond drilling for follow-up depending on the physical condi-
work on both extension and tion and dimensions of the veins.
Capital Expenditures
high grade programs. There will At El Indio, these include long-
In 1996, a total of $76.4 million
also be an important in-fill hole stoping, mechanized cut
was spent on processing and
program in the Viento vein at and fill, ramp-in-vein, and under-
roaster upgrades, underground
the 3700-metre elevation. cut and fill for reserves located

30 B a r r i c k G o l d C o r p o r a t i o n

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development work and on the Production currently comes To date, exploration has not
internal shaft. A further $30 mil- from three open pits, Wendy, produced additional significant
lion is budgeted for mining Kimberly and Canto Sur. The ore gold reserves. However, new gold
and processing upgrades in 1997. is gold/silver mineralization. Due targets will be tested in 1997
to the steep terrain at Tambo, an and a program of deep drilling
TA M B O
accelerated stripping program is near the Kimberly and Wendy
Tambo Mine is five kilometres required for the first three years pits will determine if higher
southeast of El Indio at an eleva- of operation. The overall stripping grade ores exist at lower levels.
tion of 4,200 metres. In 1996, ratio for Tambo will be approxi- Capital expenditures at
production was 159,303 ounces mately 4.9:1, although with the Tambo for 1996 were $22 million,
at a grade of 0.074 ounces of accelerated stripping program, primarily for deferred stripping
gold per ton and a cash operating the present waste-to-ore ratio is and the expansion of the tailings
cost per ounce of $299. For 1997, approximately 8.5:1. The Mine dam. In 1997, it is expected that
production is expected to be has its own 6,000-tonnes-per-day approximately $8 million will be
175,000 ounces at a cost of less mill, using a conventional cyanide spent at Tambo to complete the
than $260 per ounce. leach, carbon-in-pulp circuit. tailings project and for stripping.

Barrick mines El Encierro

Barrick projects N
Areas of alteration
Barrick property - Chile
Barrick property - Argentina Lama Barrick
La Ortiga

0 10 Kilometres
Pascua
Qda. Pintada
El Indio Property
Ortiguita
Left: Barrick’s El Indio Property covers
1,300 square kilometres of the El Indio Belt,
Despoblados
CHILE about 180 kilometres long and 10 to 15 kilo-
Veladero metres wide, located close to the Argentina
BRAZIL

El Indio Mine ARGENTINA border in the Andes Mountains.

PERU

BOLIVIA

PACIFIC Tambo Mine

OCEAN

CHILE Del Carmen

INA
ENT

Area of
ARG

map

B a r r i c k G o l d C o r p o r a t i o n 31

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 A Record of Respect
Corporate Responsibility

A t Barrick, the concept of

corporate responsibility is
fundamental to the way the Com-
restore natural ecosystems to their
original condition, or better.
The environmental committee
pany conducts its business. That of Barrick’s board of directors
Barrick conducts
applies to corporate policies and regularly reviews and monitors
procedures on environmental the Company’s performance. The
its business with issues, the way the Company acts foundation for that performance
to strengthen the social fabric is outlined in the Environmental
high standards of the communities in which Policy Statement approved by the
it operates, and the steps it takes Board in 1995. It is implemented
of respect for its to nurture the entrepreneurial by a corporate vice president,
spirit of the people who are part environment, his staff, full-time
employees, their of the Barrick team. staff in each country of opera-
It stems from a belief that tion and at each operating site.
communities and Barrick shareholders benefit from
a strong record of environmental
the environment. stewardship and respect for
employees and their communities.

The result is a
E N V I R O N M E N TA L
LEADERSHIP IS A KEY ASSET
stronger company
Although environmental items
appear in financial statements as
and more benefit
expenses or potential liabilities,
the fact is Barrick’s environ-
to shareholders. mental track record is one of the
Company’s greatest assets.
The Company’s goal is to meet
or surpass all environmental reg-
ulations and guidelines, minimize Reclaimed topsoil covers waste rock.
Soon native vegetation will thrive.
the impact of development and

32 B a r r i c k G o l d C o r p o r a t i o n

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 C o r p o r a t e R e s p o n s i b i l i t y

Barrick applies the same high charities, cultural groups and

standards of practice worldwide, educational institutions.
even if that means exceeding the For instance, since 1989,
extent of local regulations. Barrick has donated $6.5 million
The Company’s track record to communities, schools and
speaks well of its success in charities in Nevada, where the
this area. In 1996, for example, Goldstrike Property and Bullfrog
Barrick earned a number of pres- Mine are located. In Canada, the
tigious awards for environmental Company has made major dona-
leadership from government tions to support local medical,
and regulatory bodies, including sports and educational programs
reclamation awards from close to our mines in Ontario and
the state of New Mexico and the Quebec. In Chile, similar programs
province of British Columbia. have been developed to improve
Barrick supports the communities
A major focus for Barrick over nutrition for school children and in which it operates. Here, children
the past two years has been to to support schools and hospitals. play in an Elko park that Barrick
helped build.
bring the newly-acquired proper-
ties in South America up to the U N LO C K I N G O U R
E M P LOY E E S ’ P O T E N T I A L
Company’s environmental and about $4 million. The program is
health and safety standards. Since Barrick is only as strong as the open to all Barrick employees,
acquiring the El Indio Property skills, abilities and motivation its except officers. Similarly, as many
in Chile in 1994, the Company employees bring to their work. children of employees as possible
has spent more than $30 million So the Company has always placed are given summer work with the
on environmental and workplace a high priority on programs which Company.
safety improvements at the site. develop the full potential and In the belief that home
entrepreneurial spirit of its people. ownership is a key to community
C R E AT I N G S T R O N G E R Barrick attracts and motivates stability, Barrick also provides
LO C A L C O M M U N I T I E S
the best people in the industry housing support for employees.
Barrick’s leadership role, and its by rewarding them for their efforts In the Elko community near
responsibilities, extend to the with attractive salaries, benefits Goldstrike, Barrick arranged
communities in which it operates. and incentive plans. for the building of nearly
It is Company policy to support Under the Barrick Scholarship 700 housing units, and provided
charitable endeavours through Program, children of Barrick mortgage guarantees to help
donations equal to 1% of prior employees are entitled to Com- many employees buy their first
year’s earnings. The money goes pany-paid scholarships for post- home. These initiatives helped
to a broad spectrum of recipients secondary education. To date, Elko win the title “Best Small
including international health 1,770 scholarships have been Town in America” in a nation-
organizations, local hospitals, awarded with a total value of wide survey in 1993.

B a r r i c k G o l d C o r p o r a t i o n 33

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 Meeting the Challenge
Technology
ew technologies – and
N Barrick’s ability to develop
and apply them – have played
ways. For instance, Company
engineers developed autoclave
vessels that can operate for as long
a key role in the Company’s as nine months without main-
success. Barrick’s approach is to tenance, instead of the more
find the best mining and milling standard three months, and they
processes for each mine or ore created a simplified heat recovery
Barrick believes type and then improve them for system to significantly reduce
even greater efficiency. maintenance and operating costs.
that any process or For example, Barrick’s devel- Barrick improvements have
opment of large-scale autoclaving reduced autoclave processing
operation, no made the Betze-Post Mine eco- time to 55 minutes from 90.
nomic. The Company introduced Technical achievements like these
matter how good large-scale autoclaving to the have increased throughput and
gold-mining industry, enhanced
maximized production so that
it already is, it and used it to make Goldstrike
gold recovery rates exceed 90%,
one of the finest gold properties
compared to 30% or less with
in the world.
may be improved conventional methods for these
At Goldstrike, microscopic
types of ore.
particles of gold are encapsulated
through innovation. in sulphide particles within the
This kind of enterprising spirit
lies behind Barrick’s solutions
ore. To make this ore amenable to
to many other challenges as well.
gold extraction, the sulphides
must first be oxidized. In nature, Challenge: At the Meikle Mine,

this process takes millions of rock temperatures underground

years. Autoclaving uses intense reach as high as 140°F.
heat and pressure to oxidize them Barrick’s solution: Design
in less than an hour. and build the largest surface
Autoclaving is not new, but refrigeration plant in North
Barrick took the technology and America, which can pump up to
refined it in many important 600,000 cubic feet of 40°F air
through the mine every minute.

34 B a r r i c k G o l d C o r p o r a t i o n

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 Te c h n o l o g y

The system is based on South patterns change. In addition, as fine-tuning the combination
African technology. part of a trolley-assist system, five of bacteria, nutrients and
miles of overhead trolley lines acidic medium to achieve the
Challenge: At the Betze-Post
were installed to help trucks exit most efficient oxidation.
Mine, most of the ore lies below
the pit 80% faster, using cleaner, The point is flexibility. New
the original water table.
efficient electric power. The technologies can have the power
Barrick’s solution: Develop and
net result is operating savings of to open up previously uneco-
build the largest water handling
more than $10 million a year nomic deposits, make existing
system of any gold mine in the
and lower capital costs as well. deposits more economic, and
world. The water treatment facil-
ity and conveyance system now provide significant environmental
Now Barrick is developing other
under construction will allow and other benefits. Barrick’s
innovative technological solu-
treated water to be discharged leadership in the development
tions. Ammonium thiosulphate
into the Humboldt River. and use of new technologies
processing is a patented new
is a key part of our ability to
Challenge: With 74 trucks log- system which achieves 80% to 90%
continue to create exceptional
ging 18,800 miles a day, shuttling gold recovery rates from high-
value for our shareholders.
between seven shovels and two grade carbonaceous/sulphidic

dozen stockpiles and dumps, ores. Since this process piggybacks

transportation costs at the Betze- on existing autoclaving facilities,
Post Mine are a major factor. capital costs could be minimized
Barrick’s solution: A computer- and operating costs would be
assisted dispatch system, located in similar to present levels, obtained
an air-traffic-control-style tower through the conventional carbon-
on the rim of the pit, matches in-leach process.
trucks to shovels so there is no Barrick has also been devel-
waiting time and directs each oping new approaches to two
load to the right destination. other technologies that improve
It also tracks such things as tons the economics of recovering
mined, ore mined, loads per gold from low-grade sulphidic
shift and fuel consumption. The ores. Low-grade flotation involves
dispatch system was recently treating the ore with chemicals
enhanced by a satellite-based and air, separating a concentrate
Global Positioning System (GPS), that can be sent for autoclaving. Trucks on trolley assist leave the pit
which provides much more Bioleaching entails the use 80% faster, use clean electric power
and are less subject to wear. 1996
intensive coverage and thus per- of microorganisms to oxidize savings: $10 million in operating costs
mits rapid, flexible adjustments ore prior to the more conven- and $12 million in new trucks that the
mine would otherwise have had to buy.
to truck assignments as traffic tional heap-leaching. Barrick is

B a r r i c k G o l d C o r p o r a t i o n 35

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 Reserves and Gold Mineralized Material
The table below sets forth Barrick’s interest in the total These figures are estimates, however, and no assur-
proven and probable reserves at each property, based ance can be given that the indicated quantities of gold
on a gold price of $400 per ounce. For the first time, will be produced. Gold price fluctuations may render
Barrick is reporting gold mineralized material. This ore reserves containing relatively lower grades of
material has been geologically defined to be potentially gold mineralization uneconomic. Moreover, short-term
economic, yet is not in a definitive mine plan. For operating factors relating to the ore reserves, such
definitions of proven and probable reserves and gold as the need for orderly development of ore bodies or
mineralized material, see Mining Terms, page 68. the processing of new or different ore grades, could
The Company has carefully prepared and verified the affect the Company’s profitability in any particular
ore reserve figures and believes that its method of esti- accounting period.
mating reserves has been verified by mining experience.

December 31, 1996 December 31, 1995

Contained Contained
Tons Grade Ounces Tons Grade Ounces
(thousands) (oz/ton) (thousands) (thousands) (oz/ton) (thousands)

UNITED STATES
Betze-Post Mine
Proven and probable 122,677 0.192 23,603 112,322 0.204 22,952
Mineralized material 55,755 0.189 10,558
Meikle Mine
Proven and probable 8,468 0.716 6,065 8,373 0.683 5,719
Mineralized material 1,383 0.717 992
Bullfrog Mine
Proven and probable 10,186 0.062 628 13,180 0.061 799
Mineralized material 3,669 0.040 147
Mercur Mine
Proven and probable 3,723 0.054 202 6,813 0.052 352
Newmont/Barrick HD
Venture Project (40%)
Proven and probable 2,820 0.424 1,197 – – –
Mineralized material 130 0.304 40
Pinson Mine (50%)
Proven and probable 1,282 0.072 92 1,048 0.073 77
Total – United States
Proven and probable 31,787 29,899
Mineralized material 11,737

36 B a r r i c k G o l d C o r p o r a t i o n

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 R e s e r v e s a n d G o l d M i n e r a l i z e d M a t e r i a l

December 31, 1996 December 31, 1995

Contained Contained
Tons Grade Ounces Tons Grade Ounces
(thousands) (oz/ton) (thousands) (thousands) (oz/ton) (thousands)

CANADA
Bousquet Mine
Proven and probable 4,326 0.248 1,072 3,980 0.227 903
Mineralized material 5,420 0.186 1,006
Doyon Mine (50%)
Proven and probable 5,659 0.168 948 4,703 0.172 811
Mineralized material 5,015 0.165 827
Holt-McDermott Mine
Proven and probable 3,635 0.201 731 3,092 0.235 726
Mineralized material 5,902 0.149 880
Golden Patricia Mine
Proven and probable 40 0.371 15 102 0.402 41
Total – Canada
Proven and probable 2,766 2,481
Mineralized material 2,713

CHILE
El Indio Mine
Proven and probable 8,101 0.145 1,173 15,324 0.149 2,280
Mineralized material 38,206 0.095 3,631
Tambo Mine
Proven and probable 17,327 0.050 858 14,722 0.058 861
Mineralized material 14,431 0.049 707
Pascua Mine Project
Proven and probable 172,047 0.059 10,069 28,435 0.068 1,942
Mineralized material 132,953 0.050 6,702
Total – Chile
Proven and probable 12,100 5,083
Mineralized material 11,040
Barrick’s Interest – Chile(1)
Proven and probable 10,086 4,159
Mineralized material 9,700

PE RU
Pierina Mine Project
Proven and probable 67,724 0.096 6,478 – – –
Mineralized material 13,717 0.056 764
Company Total
Proven and probable 51,117 36,539
Mineralized material 24,914
(1)
Ownership interest in the Pascua Mine Project is 80%.

B a r r i c k G o l d C o r p o r a t i o n 37

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 Operating and Financial Information
UNITED STATES

Betze-Post Mine Meikle Mine Bullfrog Mine

(100% owned) (100% owned) (100% owned)
O PE RATIN G IN FO RMATIO N (thousands) 1996 1995 1996 1995 1996 1995
Tons of ore milled 6,038.3 5,929.6 160.2 – 3,008.6 3,110.1
Average grade (ounces per ton) 0.353 0.356 0.527 – 0.073 0.062
Recovery rate (%) 90.0 92.0 93.0 – 93.0 91.7
Ounces of gold produced from:
Mill ore 1,909.0 1,940.2 78.4 – 205.3 176.3
Leach ore 26.0 91.7 – – – –
Total ounces produced 1,935.0 2,031.9 78.4 – 205.3 176.3
Barrick’s share of ounces produced 1,935.0 2,031.9 78.4 – 205.3 176.3

FINAN CIAL IN FO RMATIO N (dollars)

Gold sales per ounce $ 415 $ 406 $ 415 – $ 415 $ 406

Production costs per ounce
Direct mining costs $ 126 $ 115 $ 142 – $ 293 $ 321
Applied (deferred) stripping 36 32 – – (5) –
By-product credits – – – – (7) (12)
Cash operating costs per ounce 162 147 142 – 281 309
Royalties 27 18 12 – 11 17
Production taxes 7 8 – – 1 4
Total cash costs per ounce 196 173 154 – 293 330
Depreciation and amortization 36 36 62 – 37 88
Reclamation 3 2 1 – 3 3
Total production costs per ounce $ 235 $ 211 $ 217 – $ 333 $ 421
Operating cash flow per ounce $ 219 $ 233 $ 261 – $ 122 $ 76
Capital expenditures (millions) $ 62.0 $ 90.3 $ 60.5 – $ 7.9 $ 18.9
Deferred (applied) stripping/
stockpile (millions) $ (39.7) $ (35.5) – – $ 1.0 –

38 B a r r i c k G o l d C o r p o r a t i o n

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 O p e r a t i n g a n d F i n a n c i a l I n f o r m a t i o n

CHILE

Mercur Mine Pinson Mine El Indio Mine Tambo Mine

(100% owned) (50% owned) (100% owned) (100% owned)
1996 1995 1996 1995 1996 1995 1996 1995
2,032.8 1,910.1 549.4 559.1 1,179.3 1,155.5 2,489.4 1,484.7
0.053 0.065 0.077 0.088 0.172 0.198 0.074 0.108
69.0 77.1 79.0 78.8 83.4 83.4 86.7 83.6

74.5 95.8 32.4 38.8 169.4 192.5 159.3 133.7

8.1 5.9 10.0 8.1 – – – –
82.6 101.7 42.4 46.9 169.4 192.5 159.3 133.7
82.6 101.7 12.1 12.3 169.4 192.5 159.3 133.7

$ 415 $ 406 $ 415 $ 406 $ 415 $ 406 $ 415 $ 406

$ 314 $ 257 $ 342 $ 266 $ 601 $ 452 $ 385 $ 295

– 46 – – – – (74) (59)
(1) (2) – – (338) (286) (12) (6)
313 301 342 266 263 166 299 230
4 7 14 13 17 – 8 –
3 3 – 1 – – – –
320 311 356 280 280 166 307 230
146 142 99 119 160 136 105 79
17 8 22 19 4 2 5 2
$ 483 $ 461 $ 477 $ 418 $ 444 $ 304 $ 417 $ 311
$ 95 $ 95 $ 59 $ 126 $ 135 $ 240 $ 108 $ 176
$ 3.6 $ 4.1 – $ 0.8 $ 76.4 $ 81.9 $ 9.9 $ 74.6

– $ (4.6) – – – – $ 11.9 $ 7.7

B a r r i c k G o l d C o r p o r a t i o n 39

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 O p e r a t i n g a n d F i n a n c i a l I n f o r m a t i o n

CANADA

Bousquet Mine Doyon Mine Holt-McDermott Mine

(100% owned) (50% owned) (100% owned)
O PE RATIN G IN FO RMATIO N (thousands) 1996 1995 1996 1995 1996 1995
Tons of ore milled 892.9 960.4 1,291.6 1,285.3 483.7 421.6
Average grade (ounces per ton) 0.270 0.242 0.172 0.180 0.251 0.163
Recovery rate (%) 96.0 94.9 95.1 96.0 96.9 96.5
Ounces of gold produced 231.4 220.4 209.0 219.3 117.6 66.4
Barrick’s share of ounces produced 231.4 220.4 104.5 110.0 117.6 66.4

FINAN CIAL IN FO RMATIO N (dollars)

Gold sales per ounce $ 415 $ 406 $ 415 $ 406 $ 415 $ 406
Production costs per ounce
Direct mining costs $ 252 $ 285 $ 218 $ 212 $ 160 $ 236
Applied (deferred) stripping – – – – – –
By-product credits (59) (59) – – – –
Cash operating costs per ounce 193 226 218 212 160 236
Royalties – – 4 4 – 5
Production taxes – – – – – –
Total cash costs per ounce 193 226 222 216 160 241
Depreciation and amortization 80 80 100 71 76 101
Reclamation 5 8 4 7 2 2
Total production costs per ounce $ 278 $ 314 $ 326 $ 294 $ 238 $ 344
Operating cash flow per ounce $ 222 $ 180 $ 193 $ 190 $ 255 $ 165
Capital expenditures (millions) $ 6.9 $ 18.2 $ 7.9 $ 6.2 $ 4.2 $ 9.4

40 B a r r i c k G o l d C o r p o r a t i o n

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 Production and Cost Summary (1)

Gold Production Cash Operating Costs

(ounces) (per ounce)
Golden Patricia Mine
1996 1995 1996 1995
(100% owned)
1996 1995 UNITED STATES

154.6 166.7 Betze-Post Mine 1,934,966 2,031,885 $ 162 $ 147

0.352 0.435 Meikle Mine (2) 78,442 – 142 –
97.9 97.7 Bullfrog Mine 205,268 176,307 281 309
Mercur Mine 82,593 101,682 313 301
53.3 70.9 Pinson Mine (3) 12,098 12,315 342 266
53.3 70.9 CANADA
Bousquet Mine 231,354 220,391 193 226
Doyon Mine (3) 104,495 109,963 218 212
Holt-McDermott Mine 117,621 66,389 160 236
Golden Patricia Mine 53,302 70,861 319 237
$ 415 $ 406
Macassa Mine (4) – 24,530 – 316
CHILE
$ 319 $ 237
– – El Indio Mine 169,359 192,465 263 166
– – Tambo Mine 159,303 133,719 299 230

319 237 3,148,801 3,140,507 $ 193 $ 180

– –
(1)
Effective January 1996, the Company adopted The Gold Institute Production Cost
– –
Standard. Accordingly, 1995 comparative figures have been restated to conform to the
319 237 1996 presentation.
(2)
Production commenced in September 1996.
92 66 (3)
Barrick’s proportional share.
17 1 (4)
Property sold in May 1995.
$ 428 $ 304
$ 96 $ 169
$ 2.7 $ 4.9

B a r r i c k G o l d C o r p o r a t i o n 41

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 Financial
Strength
Management’s Discussion and
Analysis of Financial Results

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 M a n a g e m e n t ’ s D i s c u s s i o n a n d A n a l y s i s o f F i n a n c i a l R e s u l t s

D uring 1996, Barrick added

15 million ounces to
reserves, opened the new Meikle
held a portfolio of 47 mineral
properties covering some 180,000
hectares in Peru in addition to its
Barrick offers

Mine and put the Pierina and

shareholders an
principal property, Pierina. Barrick
Pascua Mine Projects into devel- now has detailed field work under-
opment. The 40% growth in way on some of these properties.
unequalled
reserves, for a year end total of Barrick issued 14 million com-
51 million ounces of gold, resulted mon shares and paid $426 million combination of
from increases at Pascua and cash to Arequipa shareholders for
from the recently acquired Pierina total consideration of $790 mil- operating and
deposit. lion. The acquisition has been
1996 net income of $218 million, accounted for as a purchase with financial strengths
(60 cents per share) is lower than the full consideration allocated
the $292 million earned in 1995 to its principal gold development and the potential
(82 cents per share), primarily as project, Pierina.
a result of an after-tax charge of Within four months of the for future growth.
$38 million (10 cents per share) acquisition, Barrick had drilled
relating to the Cerro Corona explo- over 35,000 metres in 201 drill
ration project in Peru, and higher holes and brought 6.5 million
operating and exploration costs. ounces of gold into reserves
Correspondingly, operating cash at Pierina. The deposit is still
flow decreased by 8% to $463 mil- open to the east and south.
lion, compared with $502 million The Mine, which is expected to
in 1995 and $376 million in 1994. commence production in late
1999 with a current 10-year life,
A C Q U I S I T I O N O F A R E Q U I PA
is expected to add 500,000 ounces
Barrick acquired Arequipa of gold annually and reduce
Resources Ltd. in August 1996. Barrick’s average operating costs
Arequipa was a natural resources per ounce. Operating costs at
company engaged in the acquisi- Pierina are expected to be less Randall Oliphant
tion and exploration of mineral than $100 per ounce, significantly Executive Vice President
properties in Peru. The company below Barrick’s 1996 average cost and Chief Financial Officer

➢
After being melted in a furnace, gold is poured into doré bars.

B a r r i c k G o l d C o r p o r a t i o n 43

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 M a n a g e m e n t ’ s D i s c u s s i o n a n d A n a l y s i s o f F i n a n c i a l R e s u l t s

Barrick’s Hedging of $193 per ounce. Initial esti- reflect a full year of ownership of
mates for construction costs are the properties added through
Program
$200 million. the Lac Minerals Ltd. acquisition

(US dollars per ounce) in September 1994; whereas

REVENUES
■ Barrick Premium 1994 comparative results reflect
■ Average Spot Gold sales only four months of ownership.
Gold Price
Higher realized prices resulting The Company expects to realize
Gold Sales Revenue from the Company’s gold price an average price of $420 per
422 hedging program increased gold ounce, compared to a current spot
77 415 sales revenue in 1996. price of approximately $360 per
409 27
406 The Company, under its gold ounce, for its 1997 targeted produc-
49 402 22
18 price hedging program, realized tion of 3 million ounces of gold.
$415 per ounce on gold sales
388 in 1996 compared to $406 in 1995 Gold price hedging
384 384
and $402 in 1994. Compared to At the end of 1996, the Company
the average spot gold price for the had 6.7 million ounces hedged,
year of $388 per ounce, Barrick more than two years of expected
360
generated a $27-per-ounce pre- production or 13% of reserves.
345 mium over spot or $84 million in The program has not only locked
additional revenue in 1996. Over in earnings and cash flow to sup-
the past five years, the program port the Company’s aggressive
has enabled Barrick to realize growth and development programs
$39 per ounce over the average but also generated over $370 mil-
300 spot price of $372 for the same lion in additional revenues and
92 93 94 95 96 period. The impact of the $9 per $285 million in additional earnings
ounce increase over 1995 in the over the past five years.
• 6.7 million ounces hedged
realized price was partially offset Hedging programs are designed
at year end 1996 at
by fewer ounces of gold sold. to manage the risks associated with
average price per ounce
Revenue from gold sales of fluctuations in price. As future
of $420 or higher
3,128,941 ounces was $1,299 million gold prices command a premium
• Generated $370 million in in 1996, marginally higher than to the spot price, hedging takes
additional revenue and
the $1,281 million reported in 1995 advantage of this characteristic by
$285 million in earnings
on gold sales of 3,156,419 ounces using forward contracts to sell gold
over last five years
($936 million in 1994 on gold sales today for delivery in the future at
of 2,329,513 ounces). Operating a higher price than today’s market
results in years subsequent to 1994 price. This forward premium, more

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 M a n a g e m e n t ’ s D i s c u s s i o n a n d A n a l y s i s o f F i n a n c i a l R e s u l t s

commonly known as contango, is which price is higher at the time. cash is consistent with the higher
comprised of the interest earned on Each time a hedge contract is rolled level of development activities
dollars from the sale of borrowed forward, it increases in value in 1996, which included the pur-
gold, less the cost of borrowing with the forward premium. With chase of Arequipa Resources Ltd.
the gold. The interest rate differ- Barrick’s reserves and financial for net cash of $422 million and
ential generates the higher forward strength, it is able to roll forward the completion of construction of
price. The Company also mitigates a contract for up to ten years. the Meikle Mine for $61 million.
the negative impact of fluctuating While the cash flow benefit of The Company invests its surplus
gold borrowing costs by investing this flexibility is immediate, for funds in low-risk, short-term
funds for longer terms, thereby accounting purposes, the origi- investments.
achieving higher interest rates than nally designated hedge price is
COSTS AND EXPENSES
the short-term dollar rates. Thus, brought into income and the
Barrick is still able to earn attrac- excess of the spot price over the Operating costs
tive contango in a higher gold designated hedge price is deferred Operating costs increased 9% to
lease rate environment. and brought into income at $691 million in 1996 compared with
While in the past nine years the new designated delivery date. $635 million in 1995. On a per
Barrick’s hedge prices have been ounce basis cash operating costs
greater than the spot gold price, the Interest and other income of $193 were higher than expected
use of spot deferred contracts gives Interest and other income of and higher than the $180 per ounce
the Company flexibility should the $19 million in 1996 represents incurred in 1995 ($165 per ounce
spot price exceed its hedge prices. interest earned on the Company’s in 1994). The record performance
Under this type of forward con- surplus funds. Interest income was at the Canadian operations, where
tract, the Company can deliver its $7 million lower than the $26 mil- costs on average came down by
gold against the contract, or roll lion earned in 1995 ($18 million $26 per ounce to $204 per ounce,
forward the contract and sell on in 1994) because of lower surplus was more than offset by higher
the spot market, depending on cash. The lower level of surplus costs at the Betze-Post Mine and
the Chilean operations.

Production costs United States Canada Chile Total

per ounce 1996 1995 1996 1995 1996 1995 1996 1995
Gold production – ounces (thousands) 2,313 2,323 507 492 329 326 3,149 3,141
Cash operating costs $ 178 $ 167 $ 204 $ 230 $ 280 $ 191 $ 193 $ 180
Royalties /production taxes 31 24 1 2 13 – 24 18
Total cash costs 209 191 205 232 293 191 217 198
Depreciation and amortization 41 45 87 80 133 113 58 57
Reclamation 3 3 5 6 5 3 4 3
Total production costs $ 253 $ 239 $ 297 $ 318 $ 431 $ 307 $ 279 $ 258

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Net Operating The Betze-Post Mine, which costs at this mine to $193 per
accounted for over 60% of the ounce compared to $226 in 1995.
Income
Company’s gold production, Lower tonnage and grade
( US dollars per ounce ) reported cash operating costs of from Rio del Medio, a source of
■ Net Operating Income $162 per ounce, $5 higher than ore for both El Indio and Tambo
■ Income Tax expected and higher than the Mines, an eight-day strike, severe
■ Depreciation and Reclamation 1995 costs of $147 per ounce. The winter conditions, upgrading
■ Royalties and Production Taxes
increase in costs resulted from work carried out on underground
■ Cash Operating Costs
a higher life-of-mine stripping support systems and lower than
Gold Sales Revenue ratio and higher diesel fuel prices. expected copper prices were
422 415 In 1997, operating costs at the the factors that increased cash
409 402 406
148 107
141 120 117 Goldstrike Property, which will operating costs at the Chilean
include a full year of production operations to $280 per ounce.
from the low-cost Meikle Mine, Most of the properties at the
29 are expected to be comparable Goldstrike Property carry a 4% net
40 31 to the 1996 costs. However, on smelter return royalty (NSR) and
39 62
37
60 a Company-wide basis, cash a 5% net profits interest royalty
48
56 45
24 operating costs are expected to (NPI). During the year, Barrick
29 18
18 193 be lower than 1996 at approxi- effectively converted the interests
17 180
162 168 165
mately $190 per ounce as the of the minority shareholders in
result of expected improvements the Chilean El Indio and Tambo
at the Chilean operations. Mines into a 2% NSR on gold
Cost improvements at the production and 3% NSR on copper
Canadian operations are attribut- production. Royalty costs fluctu-
able to the Holt-McDermott Mine, ate with the average spot prices of
92 93 94 95 96
where gold production increased gold and copper, and changes in
• Despite increasing costs by 77% with the mining of the production, operating and capital
during 1996, profit margin high grade South Zone, reducing costs. In 1996, royalties and pro-
remained over 25%, one cash operating costs to $160 per duction taxes increased to $24 per
of the industry’s highest
ounce compared to $236 per ounce ounce from $18 per ounce in 1995
in 1995. In addition, the com- because of the conversion of the
pletion of the consolidation of minority shareholders at El Indio
the Bousquet Mine in the third and Tambo Mines, and a lower
quarter reduced cash operating allocation of capital expenditures

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to the royalty-bearing Post claims Costs include World Gold Council Barrick’s production. In 1996,
on the Goldstrike Property. and other industry membership Barrick carried out this strategy
In 1997, royalties and produc- fees, which rose by $3 million to through the acquisition of
tion taxes on a per ounce basis $9 million in 1996. In 1997, Arequipa Resources Ltd.,
are expected to remain at the administration costs are expected detailed exploration programs
1996 level. to remain at the 1996 level. on existing properties and
through a growing network of
Depreciation and amortization Reserve development joint ventures where an addi-
Depreciation and amortization of In 1996, total expenditures were tional $20 million was invested.
$183 million in 1996 is comparable $139 million of which $66 million, In the 1996 third quarter, the
to the $181 million recorded in of exploration was expensed. Company concluded that while
1995 ($106 million in 1994) reflec- This is a substantial increase from Cerro Corona contained sub-
ting the same level of production the 1995 total of $92 million stantial gold/copper mineraliza-
over the two-year period. Accord- ($62 million in 1994). The increase tion, it was not of sufficient size
ingly, depreciation of $58 per reflects the Company’s commit- to meet Barrick’s development
ounce was in line with $57 per ment to reserve and production criteria. Accordingly, a $45 million
ounce in 1995 ($46 per ounce growth. Expenditures were charge ($38 million after tax)
in 1994). Depreciation was higher $30 million higher than budgeted to cover the Cerro Corona costs
than the 1994 level as a result primarily as a result of the was taken in 1996.
of the mines acquired in late 1994 success of the Company’s explo- The Company has budgeted
which carry a higher deprecia- ration programs at Pascua and $100 million for reserve develop-
tion per ounce charge than the Pierina. Company-wide reserves ment in 1997, half of which is
original Barrick mines. increased by 40% in 1996 to earmarked for new exploration
In 1997, depreciation is expected 51 million ounces of gold. Pascua projects around the world
to rise to approximately $65 per and Pierina accounted for 89% and is expected to be expensed.
ounce, reflecting a full year of this increase.
of Meikle Mine production and Barrick’s exploration and Interest expense
completion of construction reserve growth strategy is focused Interest expense in 1996 of
projects and lower production at on its existing operating mines $10 million, primarily representing
the Chilean mines. and the major gold belts of interest on borrowings under
North and South America, Asia the Company’s $1-billion line of
Administration and West Africa. The strategy is credit, excludes interest of
Administration costs increased to directed towards finding multi- $10 million which was capitalized
$33 million in 1996 from $31 mil- million-ounce gold deposits that to properties in development.
lion in 1995 ($23 million in 1994). will both sustain and increase

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In 1997, all interest is expected attributable to the Company’s Capital expenditures in 1997,
to be capitalized. The capitalized reserve development activities and excluding deferred exploration
interest will be amortized, once include unplanned investments of $50 million, are estimated at
the properties in development have in several joint ventures, the acqui- $275 million. Planned expenditures
commenced production. sition of an additional 23.75% in the United States are $140 mil-
interest in Pinson, expenditures at lion, principally for shaft sinking
Income taxes the newly acquired Pierina Mine at Rodeo and construction of the
The Company’s average effective Project and additional expendi- water treatment facility at the
tax rate has been constant over tures at the Pascua Mine Project. Goldstrike Property. Expenditures
the past three years: 24.7% in 1996 Of the total capital expendi- in Chile and Peru of $105 million
compared to 25.1% in 1995 and tures in 1996, $113 million was are for completion of the shaft sink-
25.4% in 1994. In 1997, the effective spent in Chile for underground ing, underground development,
tax rate is expected to remain at development, shaft sinking and deferred stripping and tailings at
the same level. Reference is drawn processing improvements at the the Chilean operating mines and
to Note 6 to the Consolidated El Indio Mine, deferred stripping commencement of construction
Financial Statements for a detailed and tailings at the Tambo Mine at the Pascua and Pierina projects.
income tax reconciliation. and road construction and Capital expenditures in Canada
feasibility work at the Pascua of $30 million are primarily
CASH FLOW AND LIQ UIDITY
Mine Project. for underground development at
Cash flow provided by operating In the United States, capital the northern Ontario and Quebec
activities was lower at $463 million expenditures were $99 million mines. These 1997 capital expen-
($1.28 per share, 1995 – $1.42 per after deducting applied stripping diture programs are to be funded
share, 1994 – $1.22 per share) as of $40 million. At the Betze-Post from cash flow from operations.
a result of higher operating and Mine, $62 million before applied During the year, the Company
exploration costs. Operating cost stripping was spent for water borrowed $500 million under its
improvements and lower explora- management, mining equipment $1-billion revolving credit facility
tion costs are expected to increase and process upgrades. Meikle to prepay all its existing debt of
operating cash flow in 1997. Mine expenditures were $61 mil- $133 million and to fund in part
Barrick’s total capital and lion for the year primarily the $422 million net cash compo-
development expenditures in 1996 for underground development, nent of the $790 million acquisi-
of $374 million were higher than service and underground equip- tion of Arequipa Resources Ltd.
planned but comparable with ment and water management. During 1996, the Company
$385 million in 1995 ($272 mil- In Canada, $22 million was paid dividends of $0.14 per share
lion in 1994). The higher than spent at four mines primarily for compared with $0.12 per share in
planned expenditures are primarily underground development. 1995 and $0.10 per share in 1994.

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RISK MANAGEMENT
in South America. Similarly, North a broad range of international
Financial risk America’s percentage of Barrick’s agencies and financial advisors to
Barrick actively manages its reserves has decreased to 68% help assess risk before making an
exposure to gold prices, currencies, in 1996 from 80% in 1994. Over investment in a particular country.
interest rates and by-product 40% of the Company’s gold
commodity prices for copper and mineralized material is located THE COMPETITIVE
ENVIRONMENT
silver. It uses a variety of hedging in South America. This diversi-
products to mitigate these risks. fication of both assets and Barrick competes with other
These instruments are used solely reserves has decreased Barrick’s mining companies for mining
for hedging purposes related to operational risk. claims and leases on exploration
the Company’s specific exposures, The political risk of operating properties, for joint-venture
not for trading purposes. in Chile and Peru was assessed agreements and for the acquisi-
and management is comfortable tion of attractive gold companies.
Operational risk that there is little risk to corporate Such competition could increase
Barrick continually assesses the assets. As part of its prudent the difficulty of concluding
mining risks encountered at each approach to business, the Com- a negotiation on terms that the
of its operations. It reduces both pany also maintains specialized Company considers acceptable.
the likelihood and the potential insurance coverage on its Chilean However, a number of factors
severity of such risks through its and Peruvian operations. strengthen Barrick’s competitive
high operational standards, empha- In each country where it has position. It is an entrepreneurial
sis on employee training, and the operations, Barrick is subject to company, with financial and oper-
risk management and loss control various levels of government ational strength to move quickly
programs in place at each mine control and regulation, and is thus and effectively as it implements
site. The Company also maintains exposed to the risk of potentially its global development program.
adequate insurance at all times adverse future changes. The Com- An excellent example of these
to cover normal business risks. pany endeavours to ensure that attributes was demonstrated in
Over the last two years, assets it is at all times in compliance Barrick’s August 1996 acquisition
by geographic area and location of with current laws, and it seeks to of Arequipa Resources Ltd.
reserves have changed substantially. foster an equitable future climate Programs also depend on
In 1994, over two-thirds of the through both direct and industry- the quality of the people involved,
Company’s assets were in North wide contact with appropriate and here too Barrick operates
America, compared to 25% regulatory bodies. Barrick draws on from a position of strength. The
in South America. Currently, just the expertise of its management Company seeks out the best
over 50% of assets are in North team, its Board of Directors and people from around the world,
America and just under 50% International Advisory Board, and and then retains them through

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Shareholders’ the quality of its employee pro- below the western world average
grams, its corporate standards of $269 per ounce.
Equity
of operation and the professional The Company begins 1997

(billions of US dollars) opportunities that it provides. with 51 million ounces of gold

3.5 Barrick has one of the lowest turn- reserves, one of the world’s
over rates in the industry. largest reserve bases, and
planned annual production of
2.9
OUTLO O K
3 million ounces.
2.6
Solid production, low operating The Company’s balance sheet
costs and gold price hedging are is characterized by high liquidity
the key components of continued and low leverage. The debt-to-
profitability for Barrick. equity ratio of 0.18 to 1 is among
Through its gold hedging pro- the lowest in the industry.
gram, Barrick has demonstrated Shareholders’ equity of $3.5 bil-
1.2
1.0 that it can manage the gold price lion is among the highest in
risk. This is especially important the industry. Barrick’s balance
given that in early 1997 gold sheet is strong enough not only
prices declined to a three-year low to fund existing operating capital
of approximately $340 per ounce. and development programs like

92 93 94 95 96
Under the Company’s hedging Pierina and Pascua but also to
program, 100% of 1997 gold pro- move quickly to take advantage
• Shareholders’ equity of
duction is hedged at a price of of other growth opportunities
$3.5 billion is among highest
$420 per ounce. This represents as they arise.
in the gold industry
approximately $60 per ounce over It is through this position of
• Has almost tripled since the current spot price, or $180 mil- strength that Barrick can increase
1993 with acquisition of lion in additional revenues. reserves and production to
key assets Operating costs which are generate higher earnings and cash
expected to be approximately flow for its shareholders over the
$190 per ounce in 1997 are well long term.

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 Consolidated Statements of Income
Barrick Gold Corporation
for the years ended December 31, 1996, 1995 and 1994
(in millions of United States dollars except per share data)

1996 1995 1994

Revenues
Gold sales $ 1,299 $ 1,281 $ 936
Interest and other income 19 26 18
1,318 1,307 954
Costs and expenses
Operating 691 635 457
Depreciation and amortization 183 181 106
Administration 33 31 23
Exploration 66 49 21
Interest on long-term obligations 10 21 11
Write-off of exploration property 45 – –
1,028 917 618
Income before taxes 290 390 336
Income taxes (note 6) (72) (98) (85)
Net income for the year $ 218 $ 292 $ 251
Net income per share (note 5)
Basic $ 0.60 $ 0.83 $ 0.81
Fully diluted $ 0.60 $ 0.82 $ 0.80

Consolidated Statements of Retained Earnings

Barrick Gold Corporation
for the years ended December 31, 1996, 1995 and 1994
(in millions of United States dollars)

1996 1995 1994

Retained earnings at beginning of year $ 976 $ 727 $ 508
Net income 218 292 251
Dividends (note 5) (51) (43) (32)
Retained earnings at end of year $ 1,143 $ 976 $ 727
See accompanying notes to consolidated financial statements.

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 Consolidated Statements of Cash Flow
Barrick Gold Corporation
for the years ended December 31, 1996, 1995 and 1994
(in millions of United States dollars)

1996 1995 1994

Cash provided by (used in) operating activities
Net income $ 218 $ 292 $ 251
Non-cash items:
Depreciation and amortization 183 181 106
Deferred income taxes 14 15 19
Write-off of exploration property 45 – –
Other (2) (1) –
458 487 376
Cash provided by (reinvested in) working capital
Bullion settlements and other receivables 17 (12) (27)
Inventories (22) (6) 4
Accounts payable and accrued liabilities 10 33 23
Cash provided by operating activities 463 502 376
Cash provided by (used in) development activities
Property and business acquisitions (note 9) (422) – 262
Property, plant and equipment (374) (385) (272)
Short-term investments – 71 (5)
Other (23) 31 3
Cash (used in) development activities (819) (283) (12)
Cash provided by (used in) financing activities
Capital stock (note 5) 22 11 6
Long-term obligations
Proceeds 500 121 –
Repayments (154) (411) (232)
Dividends (51) (43) (32)
Cash provided by (used in) financing activities 317 (322) (258)
Increase (decrease) in cash (39) (103) 106
Cash at beginning of year 284 387 281
Cash at end of year $ 245 $ 284 $ 387
See accompanying notes to consolidated financial statements.

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 Consolidated Balance Sheets
Barrick Gold Corporation
as at December 31, 1996 and 1995
(in millions of United States dollars)

1996 1995
Assets
Current assets
Cash $ 245 $ 284
Bullion settlements and other receivables 107 116
Inventories (note 2) 131 108
483 508
Property, plant and equipment (note 3) 3,991 3,004
Other assets 41 44
$ 4,515 $ 3,556
Liabilities
Current liabilities
Accounts payable and accrued liabilities $ 167 $ 172
Current portion of long-term obligations (note 4) 25 51
192 223
Long-term debt (note 4) 500 100
Reclamation and other liabilities (note 4) 135 112
Deferred income taxes (note 6) 187 173
1,014 608
Shareholders’ equity
Capital stock (note 5) 2,358 1,972
Retained earnings 1,143 976
3,501 2,948
$ 4,515 $ 3,556
Commitments and contingencies (note 8)
See accompanying notes to consolidated financial statements.

Signed on behalf of the Board

Peter Munk Gregory C. Wilkins

Director Director

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 Notes to Consolidated Financial Statements
Barrick Gold Corporation (tabular dollar amounts in millions of United States dollars)

1 Accounting Policies
These consolidated financial statements are prepared E. Financial instruments
in accordance with accounting principles generally The carrying amounts for cash, bullion settlements
accepted in Canada. As described in note 10, these and other receivables, accounts payable and accrued
principles differ in certain respects from principles liabilities on the balance sheets approximate fair
and practices generally accepted in the United States. value because of the limited term of these instruments.
Summarized below are those policies considered Long-term debt approximates fair value because the
particularly significant for the Company. References Company’s current borrowing rate for similar debt
to the Company included herein mean the Company instruments of comparable maturity is not materially
and its consolidated subsidiaries. different. See note 8(a) for additional disclosures related
The United States dollar is the principal currency to financial instruments used for hedging purposes.
of the Company’s business; accordingly, these con- Fair value estimates are made at the balance
solidated financial statements are expressed in United sheet date, based on relevant market information
States dollars. and information about the financial instrument.
These estimates are subjective in nature and involve
A. Nature of operations uncertainties in significant matters of judgement
The Company is engaged in gold mining and related and, therefore, cannot be determined with precision.
activities including exploration, development, mining Changes in assumptions could significantly affect
and processing. Gold, the Company’s principal these estimates.
product, is produced and sold in the United States,
Canada, and Chile. F. Cash
Cash is comprised of cash, term deposits and treasury
B. Use of estimates bills, with original maturity dates of less than 90 days.
The preparation of financial statements in conformity
with generally accepted accounting principles requires G. Inventories
management to make estimates and assumptions that Gold in process and mine operating supplies are valued
affect the reported amounts of assets and liabilities at the lower of average cost and net realizable value.
and disclosures of contingent assets and liabilities at
the date of the financial statements and the reported H. Property, plant and equipment
amounts of revenues and expenses during the reporting (i) Property acquisition and deferred mine costs
period. Actual results could differ from those estimates. Property acquisition and deferred mine costs are
recorded at cost and amortized by the units of
C. Basis of consolidation production method based on estimated recoverable
These consolidated financial statements include the proven, probable and possible gold reserves.
accounts of the Company and its subsidiaries and
a proportionate share of the accounts of joint ventures (ii) Buildings and equipment
in which the Company has an interest. Buildings and equipment are recorded at cost and
depreciated, net of residual value, using the straight-
D. Translation of foreign currencies line method based on the estimated useful lives
The United States dollar is the functional currency of of the assets. The maximum estimated useful lives
all of the Company’s operations which are classified as of buildings and mill equipment is 25 years and
integrated for foreign currency translation purposes. mine equipment is 15 years. Repairs and maintenance

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expenditures are charged to operations; major I. Hedging transactions

improvements and replacements which extend the In order to protect against the impact of falling gold
useful life of an asset are capitalized and depreciated prices, the Company enters into hedging transactions
over the remaining estimated useful life of that asset. which provide a minimum price for designated
(iii) Deferred stripping costs future production. Hedging transactions include spot
Mining costs associated with waste rock removal deferred contracts and option contracts. Contracted
are deferred and charged to operating expenses on prices on spot deferred sales and options are recognized
the basis of the average stripping ratio for the mine. in gold sales as designated production is delivered to
The average stripping ratio is calculated as a ratio meet the commitment. In the event of early settle-
of the tons of material estimated to be mined to the ment of hedge contracts, gains or losses are deferred
estimated recoverable ounces of gold. and brought into income at the originally designated
delivery dates.
(iv) Properties in development The Company also engages in hedging transactions
Costs incurred on assets in development are capital- to reduce the impact of fluctuations in the price of by-
ized until such assets are put in service at which time products and foreign currencies on its operating costs.
the capitalized costs are depreciated in accordance
with the policies described above. J. Revenue recognition
Interest is capitalized on the basis of expenditures Gold in transit and at refineries is recorded at net
incurred for the acquisition and development of projects, realizable value and included in bullion settlements
without restrictions to specific borrowings for these and other receivables and gold sales.
projects, while the projects are actively being prepared
for proposed production. Capitalization is discontin- K. Income taxes
ued when the asset is ready for its intended use. The Company records income and mining taxes on
(v) Mineral exploration the tax allocation basis. Differences between amounts
Mineral exploration expenditures are charged to reported for tax purposes and for accounting purposes
income as incurred. Property acquisition costs relating may result in deferred income and mining taxes.
to exploration properties and expenditures incurred Deferred income and mining taxes relate primarily
on properties identified as having development poten- to the depreciation and amortization of property,
tial are deferred on a project basis until the viability plant and equipment costs. Unremitted earnings of
of the project is determined. Costs associated with the Company’s foreign subsidiaries, which represent
economically viable projects are depreciated and substantially all of the Company’s retained earnings,
amortized in accordance with the policies described have been indefinitely reinvested and accordingly
above. If a project is not viable, the accumulated no provision has been made for taxes on repatriation
project costs are charged to operations in the year in of these earnings.
which that determination is made.

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 N o t e s t o C o n s o l i d a t e d F i n a n c i a l S t a t e m e n t s

2 Inventories
1996 1995
Current:
Gold in process $ 68 $ 55
Mine operating supplies 63 53
$ 131 $ 108
Non-current (included in property, plant and equipment):
Ore in stockpiles $ 93 $ 61

3 Property, Plant and Equipment

1996 1995
Cost Accumulated Net Cost Accumulated Net
Depreciation Depreciation

Property acquisition and

deferred mine costs $ 1,401 $ 360 $ 1,041 $ 1,329 $ 278 $ 1,051
Buildings and equipment 1,376 330 1,046 1,223 253 970
Mineral properties in development 1,303 – 1,303 276 – 276
Deferred stripping costs and
ore in stockpiles 273 – 273 304 – 304
Mineral exploration 328 – 328 403 – 403
$ 4,681 $ 690 $ 3,991 $ 3,535 $ 531 $ 3,004

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4 Long-Term Debt, Reclamation and Other Liabilities

A. Long-term debt B. Term loan – Chile
On December 1, 1995, the Company entered into The term loan which had a termination date of
a credit and guarantee agreement (the “Credit December 2000, was repaid on January 31, 1996
Agreement”) with a group of international banks (1995 – $50 million).
(the “Lenders”). The Credit Agreement provides
for the Lenders to make available to the Company C. Reclamation and other liabilities
and subsidiaries designated by it from time to Estimated reclamation and closure costs are accrued
time a credit facility in the maximum amount of and charged to income over the estimated life
$1 billion or the equivalent amount in Canadian of a mine by the units of production method based
currency. The Credit Agreement, which is unsecured, on recoverable proven, probable and possible gold
provides for an initial five-year term which may be reserves. Although the ultimate amount of reclama-
extended at the Company’s option, subject to approval tion and closure costs to be incurred is uncertain,
of a majority of the Lenders, on an annual basis the Company has estimated planned site restoration
for up to an additional three years. During 1996 the and related obligations which it believes will meet
Company obtained approval to extend the Credit current regulatory requirements to be $240 million,
Agreement for one additional year. The facility has $143 million of which has been accrued to Decem-
an interest rate of Libor plus 0.15% when utilized, ber 31, 1996 (1995 – $107 million). The future changes,
and an annual fee of 0.075%. As at December 31, 1996 if any, in regulations and cost assumptions may be
the Company utilized $500 million under the Credit significant and will be recognized when applicable.
Agreement (1995 – nil), with scheduled repayment
no later than 2001.
Interest expense excludes capitalized amounts
of $10 million (1995 – nil, 1994 – nil).

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5 Capital Stock
A. Authorized capital
Authorized capital stock of the Company is com-
prised of an unlimited number of common shares,
9,764,929 First preferred shares, Series A and
9,047,619 Series B, and 14,726,854 Second preferred
shares, Series A.

B. Issued and outstanding shares

Details of issued and outstanding shares are as follows:

Common shares (millions) Issued Amount

Outstanding at December 31, 1993 286 $ 685
Issued during 1994
In part consideration for all the outstanding shares
of Lac Minerals Ltd. (note 9) 66 1,199
For cash 1 6
Outstanding at December 31, 1994 353 1,890
Issued during 1995
In part consideration for an exploration property 3 71
For cash 1 11
Outstanding at December 31, 1995 357 1,972
Issued during 1996
In part consideration for all the outstanding shares
of Arequipa Resources Ltd. (note 9) 14 364
For cash 2 22
Outstanding at December 31, 1996 373 $ 2,358

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C. Common share purchase options

There are common share purchase options outstand- December 31, 1996, 17 million (1995 – 20 million,
ing, expiring at various dates to December 8, 2006. The 1994 – 3 million) common shares, beyond those
options vest over the first four years at a rate of one outstanding at year end, were available for granting
quarter each year, beginning in the year subsequent to of options. The following is a summary of common
granting and are exercisable over 7 to 10 years. As at share purchase options:

(shares in millions) 1996 1995 1994

Outstanding at beginning of year 16 15 10
Granted at an average price of C$40.95
per share (1995 – C$34.11, 1994 – C$29.45) 3 3 6
Exercised at an average price of C$20.09
per share (1995 – C$13.99, 1994 – C$13.54) (2) (1) (1)
Cancelled – (1) –
Outstanding at end of year 17 16 15
Outstanding at end of year consists of
Price range C$9.56 – C$19.31 (weighted average –
1996 – C$13.02, 1995 – C$13.30, 1994 – C$13.35) 4 5 6
Price range C$27.88 – C$44.25 (weighted average –
1996 – C$33.77, 1995 – C$31.47, 1994 – C$30.72) 13 11 9
17 16 15
Exercisable at end of year
Price range C$9.56 – C$19.31 (weighted average –
1996 – C$13.02, 1995 – C$13.11, 1994 – C$ 13.03) 4 5 4
Price range C$27.88 – C$44.25 (weighted average –
1996 – C$31.54, 1995 – C$31.34, 1994 – C$32.89) 5 3 1
9 8 5

D. Net income per share

Net income per share was calculated on the basis Interest on the funds which would have been
of the weighted average number of common received had the options been exercised of $1 million,
shares outstanding for the year which amounted to net of income tax, has been imputed at a rate of
363 million shares (1995 – 354 million shares, 5.5% per annum.
1994 – 309 million shares).
Fully diluted net income per share reflects the E. Dividends
dilutive effect of the exercise of the common share In 1996, the Company declared and paid dividends
purchase options outstanding as at December 31, 1996. in United States dollars totaling $0.14 per share (1995
The number of shares for the fully diluted net – $0.12 per share, 1994 – $0.10 per share).
income per share calculation was 367 million shares
(1995 – 366 million shares, 1994 – 318 million shares).

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 N o t e s t o C o n s o l i d a t e d F i n a n c i a l S t a t e m e n t s

6 Income Taxes
As the Company operates in a specialized industry Canadian federal income tax rate with the Company’s
and in several tax jurisdictions its income is subject effective income tax rate is set out below:
to varying rates of taxation. A reconciliation of the

1996 1995 1994

Canadian federal income tax rate 38.0% 38.0% 38.0%
Increase (decrease) resulting from:
Resource and depletion allowances (14.8) (12.6) (9.9)
Tax rates of other jurisdictions (6.6) (4.8) (5.0)
Exploration expenditures not tax effected 6.4 2.1 –
Non-deductible depreciation and depletion
arising from acquisitions 1.2 2.8 –
Miscellaneous 0.5 (0.4) 2.3
Effective rate of income tax expense 24.7% 25.1% 25.4%
The principal timing differences and
their tax effect are as follows:
Deferred mining and exploration costs $ (18) $ (13) $ (18)
Depreciation, depletion and amortization 4 (2) (4)
Other items – – 3
$ (14) $ (15) $ (19)
Details of income tax expense are as follows:
Current $ (58) $ (83) $ (66)
Deferred (14) (15) (19)
$ (72) $ (98) $ (85)
The components of the Company’s deferred tax liability
at December 31 are as follows:
Deferred income tax asset (liability)
Reclamation $ 39 $ 32 $ 35
Operating loss carryforwards 19 19 16
Property, plant and equipment (245) (224) (209)
Deferred income tax $ (187) $ (173) $ (158)

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7 Business Segments
The Company operates in the gold mining industry
primarily in four geographic areas: The United States,
Canada, Chile and Peru.

1996 1995 1994

Revenues
Gold sales
United States $ 953 $ 961 $ 825
Canada 209 190 83
Chile 137 130 28
$ 1,299 $ 1,281 $ 936
Depreciation and amortization
United States $ 95 $ 105 $ 80
Canada 44 39 19
Chile 44 37 7
$ 183 $ 181 $ 106
Net income
Operating income
United States $ 371 $ 405 $ 349
Canada 59 31 9
Chile (5) 29 15
425 465 373
Exploration (66) (49) (21)
Write-off of exploration property (Peru) (45) – –
General corporate expenses, net (24) (26) (16)
Income taxes (72) (98) (85)
$ 218 $ 292 $ 251
Identifiable assets by geographic area
United States $ 1,896 $ 1,883 $ 1,820
Chile 1,280 1,138 915
Peru 818 45 35
Canada 475 411 513
Other countries 46 79 189
Total assets $ 4,515 $ 3,556 $ 3,472

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8 Commitments and Contingencies

A. Hedging its counterparties to major financial institutions
As part of its gold hedging program the Company which meet the Company’s credit rating standards,
has entered into spot deferred contracts with several limiting the maximum exposure to any one counter-
major financial institutions to deliver 6.7 million party, and spreading exposure among a minimum
ounces of gold or 13% of the Company’s gold reserves number of counterparties. The Company does not
at December 31, 1996. The contracts have an average require collateral from its counterparties. The aggre-
price of $405 per ounce at their initial maturity dates. gate unrealized gain of the net market value of the
Based on existing designated contracts, forward Company’s hedge position based on forward rates and
rates and production targets, the Company expects to the gold price of $369 per ounce as at December 31,
realize $420 per ounce in 1997 for its gold sales. The 1996 amounted to approximately $270 million.
Company has further contracts in place designated
from 1998 to 2001. Delivery under these spot deferred B. Royalties
contracts can be deferred at the Company’s option for Most of the properties comprising the Betze-Post
up to ten years. and Meikle Mines are subject to a 4% net smelter
As a portion of the Company’s operating costs return and a 5% net profits interest royalty payable
and capital expenditures are denominated in foreign on the valuable minerals produced from the proper-
currencies, it has entered into forward exchange ties. El Indio and Tambo Mines are subject to a
contracts to maintain its purchasing power relative to net smelter return royalty of 2% on gold and 3% on
the United States dollar. As at December 31, 1996, the copper produced from the properties.
Company has committed to spend $89 million in
1997 and $33 million in 1998 to purchase Chilean C. Environmental
indexed pesos with an expected exchange rate equiva- The Company’s mining and exploration activities are
lent to 429 pesos and 449 pesos per $1.00 respectively. subject to various federal, provincial and state laws
In addition the Company has entered into foreign and regulations governing the protection of the envi-
exchange contracts to purchase C$220 million in 1997 ronment. These laws and regulations are continually
at an exchange rate of $0.73 for each Canadian dollar, changing and generally becoming more restrictive.
and an additional C$167 million in subsequent years The Company conducts its operations so as to protect
at various rates under $0.72 for each Canadian dollar. the public health and environment and believes
The Company has entered into a series of copper put its operations are materially in compliance with all
options which provides a minimum price of $0.92 applicable laws and regulations. The Company has
per pound for 100 million pounds of the Company’s made, and expects to make in the future, expenditures
1997 copper production. Copper is accounted for to comply with such laws and regulations.
as a by-product with the proceeds being credited to
operating costs. D. Claims
The Company regularly monitors its metal and The Company is from time to time involved in vari-
currency exposures and ensures that hedge contract ous claims, legal proceedings and complaints arising
amounts do not exceed the amounts of underlying in the ordinary course of business. The Company is
exposures. The Company does not hold or issue finan- also subject to reassessment for income and mining
cial instruments or derivative financial instruments taxes for certain years. It does not believe that adverse
for trading purposes. Realization under these hedge decisions in any pending or threatened proceedings
contracts is dependent upon the ability of the coun- related to any potential tax assessments or other
terparties to perform in accordance with the terms of matters, or any amount which it may be required to
the contracts, however, the Company’s risk is limited pay by reason thereof, will have material adverse
to unrealized gains existing at any time. The Company effect on the financial condition or future results of
attempts to minimize its credit exposure by limiting operations of the Company.

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9 Property and Business Acquisitions

A. Arequipa Resources Ltd. The acquisition has been accounted for as a
On August 27, 1996 Barrick acquired Arequipa purchase and, accordingly, these consolidated finan-
Resources Ltd., a gold exploration company, with its cial statements include the results of operations
principal exploration property located in Peru, at from the date of acquisition. The value of the assets
a cost of $790 million. This was in exchange for and liabilities acquired, based on the consideration
14 million shares of Barrick and $426 million cash. paid, was as follows:
The company had $4 million in cash at the date of
acquisition. The Company has assigned a value Assets
of $364 million to the Barrick shares as required by Cash $ 427
generally accepted accounting principles, based Other current assets 114
upon the quoted market price for the shares less a 5% Property acquisition, buildings
discount which represents the issue costs that and equipment 1,454
would otherwise have been incurred. The acquisition
has been accounted for as a purchase with the full 1,995
consideration allocated to its principal gold develop- Liabilities
ment project, Pierina. Current liabilities 238
Long-term liabilities 332
B. Lac Minerals Ltd. Deferred income taxes 60
On September 6, 1994 Barrick acquired Lac Minerals
630
Ltd., an international gold mining company with
operating mines in Canada, the United States and Net assets at values assigned $ 1,365
Chile, at a cost of $1.36 billion. This was in exchange Consideration
for 66 million shares of Barrick and $153 million cash. Cash $ 153
Consistent with the Company’s prior practice, it has Common shares (66 million shares) 1,199
assigned a fair value to the shares exchanged that is Costs of acquisition 13
less than the quoted market price of Barrick shares at
the time of the issue. While previous share issues have Total consideration 1,365
resulted in smaller adjustments to the quoted market Cash acquired (428)
price, the extremely large number of shares exchanged Common shares issued (1,199)
in this transaction (23% of the Company’s then issued Cash provided by acquisition $ 262
shares) resulted in an assigned fair value of the shares
exchanged of $18.12 per share compared to the then
current quoted market price of $22.65 per share. The
fair value assigned to the shares exchanged was deter-
mined in consultation with the Company’s investment
advisors. As required by generally accepted account-
ing principles, the assigned fair value of the 66 million
shares exchanged was based on: the quoted market
price of the shares after recognizing the effect such a
large transaction would have on the market had they
been issued for cash, price fluctuations, issue costs
and similar factors.

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10 Differences from United States Accounting Principles

These consolidated financial statements have been B. Deferred tax liabilities
prepared in accordance with accounting principles The amount of unrecognized deferred tax liability
generally accepted in Canada. United States generally for temporary differences related to the Company’s
accepted accounting principles differ in the following investments in the United States and Chile which
material areas: are essentially permanent in duration is $226 million
(1995 – $259 million).
A. Acquisitions
The acquisitions as described in note 9 would have C. Stock-based compensation
been accounted for based on the US GAAP method Effective in 1996, US GAAP encourages, but does not
used to value shares issued as consideration. In require companies to include in compensation cost
determining the value of the shares exchanged in the fair-value of stock options granted to employees.
the acquisitions, for accounting purposes under Barrick has decided not to adopt the fair-value
US GAAP, the Company has used the unadjusted method. A company that does not adopt this new
quoted market price of its shares based on the under- method must disclose the cost of stock compensation
standing that US GAAP, including the Securities and awards, at their fair-value, at the date the award is
Exchange Commission requirements, only permits granted. The fair-value of the Company’s options was
adjustments to quoted market price in very limited estimated using the Black-Scholes model with
circumstances such as where the holders are restricted assumptions of a four and one half year expected
in their ability to sell the securities exchanged. term, 30% volatility, interest rates ranging from 5.2%
In addition, the acquisitions would have been to 7.4% and an expected dividend yield of 0.45%.
accounted for gross of underlying tax effects of treat- Under US GAAP the cost of stock compensation for
ing non-deductible acquisition costs as temporary the year ended December 31, 1996 would be $7 mil-
differences as required by FAS No. 109 with an offset- lion (1995 – $2 million). The resulting pro forma net
ting credit to deferred income taxes. This method income and earnings per share for the year ended
of accounting would have no effect on the Company’s December 31, 1996 is $211 million and $0.58 respec-
reported net income for the year. The Company tively (1995 – $290 million and $0.81 respectively).
monitors other differences between Canadian and
U.S. GAAP, none of which have a material effect on
the Company’s reported net income for the year.

The following summarizes the balance sheet amounts

in accordance with US GAAP where different from the
amounts reported under Canadian GAAP:

1996 1995
Canadian United States Canadian United States
GAAP GAAP GAAP GAAP

Property, plant and equipment $ 3,991 $ 4,572 $ 3,004 $3,522

Deferred income taxes 187 481 173 391
Capital stock 2,358 2,651 1,972 2,272

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 Management Responsibility for Financial Statements
The accompanying consolidated financial statements The consolidated financial statements have been
and all of the data included in this annual report audited by Coopers & Lybrand, Chartered Accountants.
have been prepared by and are the responsibility of Their report outlines the scope of their examination
the Board of Directors and Management of the and opinion on the consolidated financial statements.
Company. The consolidated financial statements
have been prepared in accordance with accounting
principles generally accepted in Canada and reflect
Management’s best estimates and judgments based
on currently available information. The Company
has developed and maintains a system of internal Randall Oliphant
accounting controls in order to ensure, on a reason- Executive Vice President and Chief Financial Officer
able and cost effective basis, the reliability of its Toronto, Canada
financial information. February 28, 1997

Auditors’ Report to the Shareholders of Barrick Gold Corporation

We have audited the consolidated balance sheets of principles used and significant estimates made
Barrick Gold Corporation as at December 31, 1996 by management, as well as evaluating the overall
and 1995 and the consolidated statements of income, financial statement presentation.
retained earnings and cash flow for each of the In our opinion, these consolidated financial state-
three years in the period ended December 31, 1996. ments present fairly, in all material respects, the
These financial statements are the responsibility financial position of the Company as at December 31,
of the Company’s management. Our responsibility is 1996 and 1995 and the results of its operations and
to express an opinion on these financial statements its cash flow for each of the three years in the period
based on our audits. ended December 31, 1996 in accordance with
We conducted our audits in accordance with gener- accounting principles generally accepted in Canada.
ally accepted auditing standards. Those standards
require that we plan and perform an audit to obtain
reasonable assurance whether the financial statements
are free of material misstatement. An audit includes
examining, on a test basis, evidence supporting the Chartered Accountants
amounts and disclosures in the financial statements. Toronto, Canada
An audit also includes assessing the accounting January 24, 1997

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 Supplemental Information
E LEVEN-YEAR HISTO RICAL REVIEW*

1996 1995 1994 1993

Operating results (in millions)
Revenues $ 1,318 $ 1,307 $ 954 $ 681
Net income (loss) 218 292 251 213
Operating cash flow 463 502 376 317
Capital expenditures 374 385 272 165

Per share data

Net income (loss) per share $ 0.60 $ 0.82 $ 0.80 $ 0.74
Cash dividends per share $ 0.140 $ 0.120 $ 0.100 $ 0.080
Financial position (in millions)
Cash and short-term investments $ 245 $ 284 $ 458 $ 348
Total assets 4,515 3,556 3,472 1,635
Working capital 291 285 367 270
Long-term obligations 635 212 408 225
Shareholders’ equity 3,501 2,948 2,617 1,191
Debt to equity % 18% 7% 16% 19%
Operational statistics (unaudited)
Gold production (thousands of ounces) 3,149 3,141 2,326 1,632
Cash operating costs per ounce $ 193 $ 180 $ 165 $ 168
Average price realized per ounce of gold sold 415 406 402 409
Average spot price of gold per ounce 388 384 384 360
Reserves (proven and probable) (thousands of ounces) 51,117 36,539 37,589 28,439

*Information has been derived from audited financial statements, except as indicated.

Q UARTE RLY DATA

(unaudited) March June September December

(in millions except per share data) 1996 1995 1996 1995 1996 1995 1996 1995
Revenues
Gold sales $ 329 $ 300 $ 326 $ 309 $ 314 $ 295 $ 330 $ 377
Interest and other income 5 6 6 10 5 7 3 3
334 306 332 319 319 302 333 380
Costs and expenses
Operating 163 148 172 151 174 148 182 188
Depreciation and amortization 46 40 45 44 43 42 49 55
Administration 8 7 9 8 8 6 8 10
Exploration 16 9 15 9 15 13 20 18
Interest 4 5 4 6 2 5 – 5
Write-off of exploration property – – – – 45 – – –
237 209 245 218 287 214 259 276
Income before taxes 97 97 87 101 32 88 74 104
Income taxes (25) (26) (18) (26) (11) (20) (18) (26)
Net income for the period $ 72 $ 71 $ 69 $ 75 $ 21 $ 68 $ 56 $ 78

Net income per share

Basic $ 0.20 $ 0.20 $ 0.19 $ 0.22 $ 0.06 $ 0.19 $ 0.15 $ 0.22
Fully diluted $ 0.20 $ 0.20 $ 0.19 $ 0.21 $ 0.06 $ 0.19 $ 0.15 $ 0.22

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 S u p p l e m e n t a l I n f o r m a t i o n

1992 1991 1990 1989 1988 1987 1986

$ 554 $ 369 $ 283 $ 228 $ 163 $ 103 $ 74

175 92 58 34 28 16 (1)
283 160 94 77 50 34 20
256 246 174 205 178 100 17

$ 0.61 $ 0.34 $ 0.23 $ 0.14 $ 0.12 $ 0.08 $ (0.01)

$ 0.065 $ 0.055 $ 0.040 $ 0.030 $ 0.020 $ 0.010 –

$ 288 $ 252 $ 312 $ 305 $ 51 $ 167 $ 2

1,499 1,301 1,143 1,012 668 664 295
210 211 274 272 35 176 12
322 311 363 419 256 279 110
984 832 636 484 352 304 77
33% 37% 57% 87% 73% 92% 143%

1,325 790 596 468 341 225 186

$ 162 $ 204 $ 217 $ 222 $ 223 $ 210 $ 197
422 438 437 436 446 419 348
345 362 384 382 437 447 368
25,719 24,377 19,510 19,877 17,083 10,813 3,100

Financial Terms
Cash operating costs: include mine. The average stripping ratio made either in kind or in currency
site costs for all mining (excluding is calculated as a ratio of the tons based on the spot sale proceeds
deferred stripping costs), process- of material estimated to be mined received less the cost of refining at
ing and administration, but are to the estimated recoverable ounces an off-site refinery.
exclusive of royalties, production of gold. At the start of a mine’s
Ratio of debt to equity: a
taxes, depreciation, reclamation, productive life costs on a per-ounce
measure of a company’s financial
financing costs, capital costs and basis are usually higher than
strength which illustrates how much
exploration costs. in later years as the mining rate is
of the funds it uses were borrowed
above the life-of-mine stripping
Contango: contango on gold is compared with how much were
ratio. In later years, as the mining
the positive difference between the invested by shareholders or were in
rate falls below the life-of-mine
spot market gold price and the for- the form of earnings retained by
stripping ratio, the deferred costs
ward market gold price. It is often the company.
are charged to operating costs.
expressed as an interest rate and is
Spot deferred contract: a spot
the difference between inter-bank Net profits interest: a royalty
deferred contract is a forward sale
deposit rates and gold lending rates. based on the profit remaining after
with a flexible delivery date. The
recapture of certain operating,
Deferred stripping costs: ultimate delivery date and sale price
capital and other costs.
mining costs associated with waste are not fixed on the contract. If it
rock removal that are deferred and Net smelter return: a royalty is rolled over, the new contract price
charged to income on the basis of based on a percentage of valuable is based on the price at maturity in
the average stripping ratio for the minerals produced with settlement the old contract plus contango.

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 Mining Terms
Adit: a tunnel driven horizon- Concentrate: a powdery product drilling and other work involved
tally into a mountainside providing containing the valuable ore mineral in searching for ore.
access to a mineral deposit. from which most of the waste
Flotation: a process by which
material has been eliminated.
Autoclave system: oxidation some mineral particles are induced
process in which high tempera- Cut-and-fill: a method of stoping to become attached to bubbles and
tures and pressures are applied to in which ore is removed in slices float, and other particles to sink,
convert refractory sulphide miner- or lifts, and then the excavation so that the valuable minerals are
alization into amenable oxide ore. is filled with rock or other waste concentrated and separated from
material (backfill) before the the worthless gangue or waste.
Backfilling: waste material used
subsequent slice is mined.
to fill the void created by mining Gold mineralized material:
an ore body. Cyanidation: a method of mineralization based on geological
extracting gold or silver by dis- evidence and assumed continuity.
Ball mill: a steel cylinder loaded
solving it in a weak solution May or may not be supported
with steel balls into which crushed
of sodium cyanide. by samples but is supported by
ore is fed. The ball mill is rotated,
geological, geochemical, geophys-
causing the balls to cascade and Development: underground
ical or other data. This material
grind the ore. work carried out for the purpose
is sufficiently geologically defined
of opening up a mineral deposit.
By-product: a secondary metal to be deemed to be potentially
Includes shaft sinking, crosscut-
or mineral product recovered in economic, yet is not in a definitive
ting, drifting and raising.
the milling process. mine plan. This material requires
Doré: unrefined gold and silver a reasonable cut-off grade criteria
Carbon-in-leach: a recovery
bullion bars usually consisting of and has no untenable non-technical
process in which a slurry of gold
approximately 90 percent precious issues barring its exploitation.
ore, carbon granules and cyanide
metals which will be further
are mixed together. The cyanide Grade: the amount of valuable
refined to almost pure metal.
dissolves the gold content and the mineral in each ton of ore,
gold is adsorbed on the carbon. Drift: a horizontal tunnel driven expressed as troy ounces per
The carbon is subsequently alongside an ore deposit, from ton or grams per tonne for
separated from the slurry for either an adit or shaft, to gain access precious metals and as a percent-
further gold removal. to the deposit. age for other metals.
Carbon-in-pulp: similar to car- Drilling Cut-off grade: the minimum
bon-in-leach process, but initially metal grade at which an ore body
Diamond: drilling with a hollow
the slurry is subjected to cyanide can be economically mined.
bit with a diamond cutting rim
leaching in separate tanks followed to produce a cylindrical core that Millhead grade: metal content
by carbon-in-pulp. Carbon-in-pulp is used for geological study and of mined ore going into a mill for
is a sequential process whereas assays. Used in mine exploration. processing. Usually lower than
carbon-in-leach is a simultaneous reserve grade because of dilution.
Infill: diamond drilling at
process. Recovered grade: actual
shorter intervals between existing
Collar: the term applied to the holes, used to provide greater metal content of ore determined
timbering or concrete around the geological detail and to help estab- after processing.
mouth of a shaft and the start lish reserve estimates. Reser ve grade: estimated metal
of a drill hole. Reverse circulation: drilling that content of an ore body, based on
produces rock chips rather than reserve calculations.
Contained ounces: represents
ounces in the ground without core. Faster and cheaper than dia- Heap leaching: a process whereby
the reduction of ounces not mond drilling, the chips are gold is extracted by “heaping”
recovered by the applicable metal- forced by air to the surface and are broken ore on sloping imperme-
lurgical process. collected for examination. able pads and repeatedly spraying
Exploration: prospecting, the heaps with a weak cyanide
sampling, mapping, diamond

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 M i n i n g Te r m s

solution which dissolves the gold Recovery rate: a term used in air, in order to remove sulphur,
content. The gold-laden solution is process metallurgy to indicate the carbon, antimony and arsenic.
then collected for gold recovery. proportion of valuable material
Semi-autogenous grinding
obtained in the processing of an ore.
Long-hole open stope: (SAG): a method of grinding rock
It is generally stated as a percentage
a method of mining involving into fine powder whereby the
of the material recovered compared
the drilling of holes up to 90 feet grinding media consist of larger
to the total material present.
long into an orebody and then chunks of rock and steel balls.
blasting a slice of rock which falls Refractory material: gold min-
Shaft: a vertical passageway to
into an open space. The broken eralized material in which the
an underground mine for moving
rock is extracted and the resulting gold is not amenable to recovery
personnel, equipment, supplies
open chamber is not filled with by conventional cyanide methods
and material including ore and
supporting material. without any pre-treatment. The
waste rock.
refractory nature can be either sili-
Mill: a plant where ore is ground
ca or sulphide encapsulation of Smelting: a metallurgical opera-
fine and undergoes physical or
the gold or the presence of natu- tion in which metal is separated
chemical treatment to extract the
rally occurring carbons which from impurities by a process that
valuable metals.
reduce gold recovery. includes fusion.
Open pit: a mine that is entirely
Reserves: that part of a mineral Stope: an area in an underground
on the surface.
deposit which could be economi- mine where ore is mined.
Ore: rock, generally containing cally and legally extracted or
Stripping ratio: the ratio of the
metallic or non-metallic minerals, produced at the time of the reserve
number of tons of waste material
that can be mined and processed determination. Reserves are
removed to the number of tons
at a profit. customarily stated in terms of ore
of ore removed, used in connection
when dealing with metalliferous
Ore body: a sufficiently with open pit mining.
minerals. There are two categories
large amount of ore that can be
of reserves: Sulphide ore: a sub-group of
mined economically.
Proven ore: material for which refractory ore – mineralized
Oxide ore: mineralized rock in tonnage and grade are computed rock in which much of the gold is
which some of the original minerals from dimensions revealed in encapsulated in sulphides and is
have been oxidized. Oxidation outcrops, trenches, underground not readily amenable to dissolution
tends to make the ore more porous workings or drill holes; grade by cyanide solutions – associated
and permits a more complete is computed from the results of with sulphide minerals (primarily
permeation of cyanide solutions so adequate sampling; and the sites pyrite) that have not been oxidized.
that minute particles of gold in for inspection, sampling and Some sulphide ore may require
the interior of the minerals will be measurement are so spaced and autoclaving or roasting prior
readily dissolved. the geological character so well- to milling.
Ramp: an inclined underground defined that size, shape and mineral Tailings: the material that remains
tunnel which provides access content are established. after all metals considered
for exploration or a connection Probable ore: material for which economic have been removed
between levels of a mine. tonnage and grade are computed from ore during milling.
partly from specific measurements,
Reclamation: the process by Troy ounce: troy ounce of a
samples or production data and
which lands disturbed as a result fineness of 999.9 parts per 1,000
partly from projection for a reason-
of mining activity are reclaimed parts, equal to 31.1034 grams.
able distance on geological evidence;
back to a beneficial land use.
and for which the sites available for Water management: process
Reclamation activity includes the
inspection, measurement and sam- whereby the groundwater table
removal of buildings, equipment,
pling are too widely or otherwise in the mining area is lowered by
machinery and other physical
inappropriately spaced to outline pumping water from wells, and
remnants of mining, closure of
the material completely or to estab- the water is conveyed and used or
tailings impoundments, leach pads
lish its grade throughout. recharged to the groundwater
and other mine features, and
system through infiltration, rein-
contouring, covering and revegeta- Roasting: the treatment of ore
jection or irrigation return.
tion of waste rock piles and other by heat and air, or oxygen enriched
disturbed areas.

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 Shareholder Information
Barrick remains Shares traded on six major Common Shares
international stock exchanges
(millions)
the most profitable gold Outstanding at
New York London
Toronto Paris December 31, 1996 373
mining company in Montreal Swiss Weighted average
– Basic 363
the world with the best Ticker Symbol – Fully diluted 367

10-year share-price ABX Annual Dividend per Share

ABR on Swiss Exchange
performance of any US 14¢
Index Listings
major gold producer. Volume of Shares Traded
S&P 500 Index
TSE 35 (millions) 1996 1995
The Company’s TSE 100 NYSE 327 269
TSE 300 TSE 259 197
aim is to produce TSE Gold & Precious Minerals
Index
Closing Price of Shares
superior performance FT of London Gold Index
Philadelphia Gold/Silver Index (December 31, 1996)
for its shareholders NYSE US$ 28.75
Number of Shareholders TSE C$ 39.25
on a consistent basis. 15,646

SHARE TRADING INFORMATION

Quarter Share Volume High Low

Toronto Stock Exchange (millions)
1996 First 78 C$ 45.00 C$ 36.13
Second 44 43.75 36.60
Third 48 40.00 33.50
Fourth 89 41.50 33.90
1995 First 61 C$ 35.62 C$ 27.87
Second 53 37.25 30.75
Third 36 37.25 33.25
Fourth 47 38.00 30.62

New York Stock Exchange

1996 First 106 US$ 32.88 US$ 26.63
Second 82 32.13 26.88
Third 59 29.50 24.63
Fourth 80 30.50 25.13
1995 First 86 US$ 25.50 US$ 19.75
Second 68 27.00 22.62
Third 56 27.50 24.75
Fourth 59 27.62 22.75
The Company’s shares were split on a two-for-one basis in 1987, 1989 and 1993.

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 S h a r e h o l d e r I n f o r m a t i o n

Compound Annual Total Returns to Investors for Share Performance

the Ten-Year Period ended December 31, 1996 C$
4,000
Value of C$100 invested
Barrick Common Stock
31.9%

Standard & Poor’s 500

3,000
15.3%

Dow Jones Industrial Average

13.0%

Toronto Stock Exchange Gold and Precious Minerals 2,000 Barrick Gold
(share price)
7.4%

Toronto Stock Exchange 300 Index

6.8%
1,000

TSE Gold &

Precious Minerals Index

0
1983 1996

Shareholder Contacts Dividend Policy Transfer Agents and Registrars

Shareholders are welcome to The Company anticipates increasing The R-M Trust Company
contact the Company for informa- cash dividends as earnings and Corporate Trust Services
tion or questions concerning their cash flow rise. However, dividends 393 University Avenue, 5th Floor
shares. For general information on will remain modest as it is the Toronto, Ontario M5G 2M7
the Company, contact the Investor Company’s intention to retain most Telephone: (416) 813-4600
Relations Department. of its earnings to support current Toll-free within Canada and
For information on such operations, to fund exploration United States: 1-800-387-0825
matters as share transfers, dividend and development projects, and to Chemical Mellon
cheques and change of address, fund acquisitions of gold properties. Shareholder Services
inquiries should be directed to the 85 Challenger Road
Form 40-F
Secretary of Barrick or the Transfer Overpeck Center
Annual Report on Form 40-F is
Agent. Addresses and telephone Ridgefield Park, New Jersey 07660
filed with the United States
numbers of the Transfer Agent are Telephone: (201) 296-4002
Securities and Exchange Commis-
listed on this page. Toll-free within United States:
sion. This report will be made
French and Spanish versions 1-800-526-0801
available to shareholders, without
of this annual report are available
charge, upon written request to Dividend Reinvestment
from Investor Relations at the
the Secretary of the Company at Program
Corporate Office.
the Corporate Office. The Canadian Shareowners Asso-
Dividend Payments ciation, a non-profit educational
Annual Meeting
In 1996, the Company paid a organization of retail investors, has
The Annual General Meeting of
cash dividend of $0.14 per share – selected Barrick to be a part of its
Shareholders will be held on
$0.07 on June 14 and $0.07 on dividend reinvestment program for
Thursday, May 1, 1997 at 11:00 a.m.
December 16. A cash dividend Canadian investors. Barrick share-
in the Canadian Room, Royal York
of $0.12 per share was paid holders interested in this program
Hotel, Toronto, Ontario.
in 1995 – $0.06 on June 15 and should contact the Association at:
$0.06 on December 15. Telephone: (519) 252-1555
Fax: (519) 252-9570

B a r r i c k G o l d C o r p o r a t i o n 71

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 Board of Directors
Howard L. Beck, .. David H. Gilmour The Honorable Edward N. Ney
Toronto, Ontario Los Angeles, California New York, New York
Chairman, Philip Environmental Inc. Chairman, Chairman, Board of Advisors,
Mr. Beck was a founding Partner of Wakaya Group Holdings Limited Burson-Marsteller
the law firm Davies, Ward & Beck. He has David Gilmour was one of the original From 1989 to 1992, Edward Ney was
been on the Barrick Board since 1984. partners in Barrick and has been on United States Ambassador to Canada. He
the Board since the Company’s inception. has been a Director of Barrick since 1992.
C. William D. Birchall
Toronto, Ontario Angus A. MacNaughton Joseph L. Rotman, ..
Vice-Chairman, Danville, California Toronto, Ontario
Barrick Gold Corporation President, Chairman and
Mr. Birchall has had a long association with Genstar Investment Corporation Chief Executive Officer,
Barrick, being one of the original Board Mr. MacNaughton is a Vice-Chairman Clairvest Group Inc.
members of the Company. of Barrick. He has been a member of the Joseph Rotman is also the founder and
Board since 1986. Chairman of Tarragon Oil and Gas
John K. Carrington Limited. He has been a Director of Barrick
Thornhill, Ontario The Right Honourable since its inception.
President and Brian Mulroney, .., ..
Chief Operating Officer, Montreal, Quebec Robert M. Smith
Barrick Gold Corporation Senior Partner, Ogilvy Renault Oakville, Ontario
Mr. Carrington assumed his present Mr. Mulroney was Prime Minister Vice-Chairman,
position and became a member of the of Canada from 1984 to 1993. He joined Barrick Gold Corporation
Board of Directors at the end of 1996. the Barrick Board in 1993 and is Robert Smith became a Vice-Chairman
He joined Barrick in 1995 as Executive Chairman of the Company’s International of Barrick at the end of 1996 and has
Vice-President, Operations. Advisory Board. been a Director since 1985. Mr. Smith
has enjoyed a distinguished career in the
Marshall A. Cohen, .. Anthony Munk gold mining industry and, as President
Toronto, Ontario Toronto, Ontario and Chief Operating Officer, managed the
Counsel, Cassels Brock & Blackwell Vice-President, Onex Corporation rapid growth of the Company since 1987.
Mr. Cohen served the Government of Mr. Munk became a member of the Board
Canada for 15 years in a number of senior of Directors, effective December 10, 1996.
Gregory C. Wilkins
positions including Deputy Minister of Markham, Ontario
Finance. He has been a Director of Barrick Peter Munk, .. President and
since 1988. Toronto, Ontario Chief Operating Officer,
Chairman and TrizecHahn Corporation
Peter A. Crossgrove Chief Executive Officer, Mr. Wilkins was Executive Vice President
Toronto, Ontario Barrick Gold Corporation and Chief Financial Officer of Barrick
President and Chief Executive Officer, Peter Munk is the founder, Chairman until his appointment at Horsham in
Southern Africa Minerals Corporation of the Board and Chief Executive September 1993. He assumed his present
Prior to January 1993, he was Vice- Officer of Barrick Gold Corporation. position in 1996 with the merger of
Chairman and Acting Chief Executive He is also founder and Chairman Trizec Corporation Ltd. and Horsham
Officer of Placer Dome Inc. He has and Chief Executive Officer of Corporation. He has been a member
been a Director of Barrick since 1993. TrizecHahn Corporation (formerly of the Board since 1991.
Horsham Corporation).
The Honourable
J. Trevor Eyton, .., ..
Caledon, Ontario
Chairman, Brascan Limited and
Trilon Financial Corporation
Member of the Senate of Canada
Mr. Eyton has been a member of the Senate
of Canada and on Barrick’s Board since 1990.

72 B a r r i c k G o l d C o r p o r a t i o n

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 Corporate Governance
The Company, the Board of business, are subject to approval option committees are comprised
Directors and management of by the Board of Directors. entirely of unrelated directors.
Barrick emphasize effective The Board of Directors believes
Board Constitution
corporate governance. Accordingly, that it is desirable for the majority
Barrick’s Board of Directors is
they have developed systems and of the Executive Committee to
currently comprised of 15 directors,
procedures that are appropriate be related to the Company since its
the majority of whom are unrelated
to the Company and its business. mandate requires members to
to the Company. The composition
The Board of Directors is con- be available on very short notice to
of the Board reflects a breadth
tinuing to monitor its governance deal with significant issues. All
of background and experience that
practices to ensure they continue action approved by the Executive
is important for effective gover-
to be appropriate and responsive to Committee is subsequently brought
nance of a company in the mining
changing circumstances. to the attention of the full Board
industry.
of Directors. The fact that a majority
Board Mandate Board Operations of the members of the Environ-
Barrick’s management is respon- The Board of Directors has estab- mental, Occupational Health and
sible for the Company’s day-to-day lished six committees, including Safety Committee and the Finance
operations, for proposing its the audit, compensation and stock Committee are related to the
strategic direction and presenting option, corporate governance and Company is balanced by the fact
budget and business plans to the nominating, executive, environ- that the recommendations of
Board of Directors for approval. mental, occupational health and the Committees are considered by
All major acquisitions, dispo- safety and finance committees. The the full Board of Directors.
sitions and investments, as well mandates of these committees are A detailed Statement of
as significant financing and described below. The audit, corpo- Corporate Governance practices
other significant matters outside rate governance and nominating appears in the Company’s Infor-
the ordinary course of Barrick’s and compensation and stock mation Circular.

Committees of the Board

Audit Committee: Compensation and Stock Corporate Governance and
(P.A. Crossgrove, J.T. Eyton, J.L. Rotman) Option Committee: Nominating Committee:
Responsible for reviewing the (M.A. Cohen, J.T. Eyton, A.A. MacNaughton) (H.L. Beck, M.A. Cohen, A.A. MacNaughton,
Company’s financial statements with Reviews and approves compensation E.N. Ney)
management and the external policies and practices and reviews Reviews corporate governance
auditors. The Committee also reviews and recommends to the Board the policies and practices. This Committee
the external audit plan, the adequacy remuneration for directors and also reviews candidates for election
of internal control systems and senior management of the Company. as Directors, annually recommends to
meets with the external auditors to The Committee also administers the Board the slate of nominees
discuss financial issues relevant to the Company’s stock option plan. for election to the Board by the share-
the Company. holders and recommends to the
Environmental, Occupational
Board nominees to fill vacancies on
Executive Committee: Health and Safety Committee:
the Board.
(P.A. Crossgrove, A.A. MacNaughton, (C.W.D. Birchall, J.L. Rotman, R.M. Smith)
P. Munk, R.M. Smith, G.C. Wilkins) Reviews the environmental and Finance Committee:
Exercises all the powers of the Board occupational health and safety (C.W.D. Birchall, A.A. MacNaughton,
of Directors (except those powers policies and programs, oversees the G.C. Wilkins)
specifically reserved by law to the Company’s environmental and Reviews the Company’s investment
Board of Directors) in the manage- occupational health and safety strategies, gold price hedging program
ment and direction of business during performance, and monitors current and debt and equity structure.
intervals between Board meetings. and future regulatory issues.

B a r r i c k G o l d C o r p o r a t i o n 73

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 Officers
Peter Munk Randall Oliphant Louis Dionne
Chairman and Executive Vice President and Vice President,
Chief Executive Officer Chief Financial Officer Canadian Operations
The Right Honourable Luis J. Baertl Gregory P. Fauquier
Brian Mulroney Senior Vice President, Vice President,
Chairman, South American Corporate United States Operations
International Advisory Board Development
André R. Falzon
C. William D. Birchall William J. Biggar Vice President and Controller
Vice-Chairman Senior Vice President, Investments
James Fleming
Angus A. MacNaughton Alexander J. Davidson Vice President, Communications
Vice-Chairman Senior Vice President, Exploration
John T. McDonough
Robert M. Smith M. Isabel Mulligan Vice President, Environment
Vice-Chairman Senior Vice President,
Jamie C. Sokalsky
Investor Relations
John K. Carrington Vice President and Treasurer
President and Chief Operating Officer Kenneth G. Thomas
David W. Welles
Senior Vice President,
Patrick J. Garver Vice President and Tax Counsel
Technical Services
Executive Vice President and
Sybil E. Veenman
General Counsel M.Vincent Borg
Associate General Counsel
Vice President,
Alan R. Hill and Secretary
Corporate Communications
Executive Vice President, Development
Michael J. Brown
John W. Lill
Vice President,
President, Chilean Operations
United States Public Affairs
Neil T. MacLachlan and Public Relations
Executive Vice President, Far East

International Advisory Board

The International Advisory Board Members Peter Munk, Canada;
was established to provide advice Senator Howard H. Baker, Jr., Chairman and
to Barrick’s Board of Directors United States; Chief Executive Officer,
and Management as the Company Partner, Baker, Donelson, Barrick Gold Corporation and
expands internationally. Bearman & Caldwell TrizecHahn Corporation
Honorary Senior Advisor Honourable Paul G. Desmarais, Sr., Karl Otto Pöhl, Germany;
President George Bush Canada; Senior Partner,
41st President of the United States President, Director and Chairman Sal. Oppenheim Jr. & Cie.
of Executive Committee,
José E. Rohm, Argentina;
Chairman Power Corporation of Canada
Managing Director,
The Right Honourable
Vernon E. Jordan, Jr., Banco General de Negocios
Brian Mulroney
United States;
Former Prime Minister of Canada Robert M. Smith, Canada;
Senior Partner, Akin, Gump, Strauss,
Vice-Chairman,
Hauer and Feld
Barrick Gold Corporation
A. Andrónico Luksic, Chile;
Head of the Luksic Group

74 B a r r i c k G o l d C o r p o r a t i o n

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 Corporate Information
M I N I N G O P E R AT I O N S C O R P O R AT E D ATA

United States Doyon Mine Barrick Gold Corporation

Goldstrike Property: P.O. Box 970 Corporate Office
Betze-Post Mine and Rouyn-Noranda, Quebec Royal Bank Plaza
Meikle Mine J9X 5C8 South Tower, Suite 2700
P.O. Box 29 François Biron 200 Bay Street
Elko, Nevada 89803 Mine Manager P.O. Box 119
Donald R. Prahl Telephone: (819) 759-3611 Toronto, Canada
Vice President and Fax: (819) 759-3570 M5J 2J3
General Manager Telephone: (416) 861-9911
Golden Patricia Mine
Telephone: (702) 738-8043 Fax: (416) 861-2492
P.O. Box 4000
Fax: (702) 738-7685 Dryden, Ontario P8N 3J3
Brian Grebenc Auditors
Bullfrog Mine
Mine Manager Coopers & Lybrand
P.O. Box 519 Toronto, Canada
Telephone: (807) 928-2766
Beatty, Nevada 89003
Fax: (807) 928-2817
David McClure
Investor Relations
General Manager Holt-McDermott Mine
Contact:
Telephone: (702) 553-2900 P.O. Box 278
Belle Mulligan
Fax: (702) 553-2963 Kirkland Lake, Ontario
Senior Vice President,
P2N 3H7
Mercur Mine Investor Relations
John Haflidson
P.O. Box 838 Telephone: (416) 307-7442
Mine Manager
Tooele, Utah 84074 Fax: (416) 861-0727
Telephone: (705) 567-9251
Clayton L. Landa Fax: (705) 567-6867 Sandra Scott
Vice President and Director, Investor Relations
General Manager Telephone: (416) 307-7472
Telephone: (801) 268-4447 Chile
Barrick Chile Ltda. Fax: (416) 861-0727
Fax: (801) 266-4296
Av. Pedro de Valdivia 100 Toll-free number within
Piso 11, Providencia Canada and United States:
Canada Santiago, Chile
Bousquet Mine 1-800-720-7415
John W. Lill, President,
2 Bousquet Road Chilean Operations Internet address:
Route 395 Telephone: (56-2) 340-2022 http://www.barrick.com
Preissac, Quebec J0Y 2E0 Fax: (56-2) 340-2057
Yves Fourmanoît
Mine Manager El Indio Complex:
Telephone: (819) 759-3681 El Indio Mine and Tambo Mine
Fax: (819) 759-3663 Barrio Industrial,
Sitio No. 58, Alto Peñuelas
La Serena, Chile
Sergio Jarpa
General Manager
Telephone: (56-51) 20-2000
Fax: (56-51) 20-2800

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