Barrick Gold has formed a previously announced strategic joint venture (JV) with Chinese mining company Zijin Mining, including a 50% interest sale in Barrick (Niugini) (BNL), for $298m.
The company plans to use the proceeds to repay debt.
The Porgera JV gold mine in Papua New Guinea is 95% owned and managed by BNL and the remaining 5% is owned by Mineral Resources Enga.
As part of the new structure, Barrick and Zijin will jointly control BNL and work with local communities and other Papua New Guinea partners to ensure the mine generates value for all of its stakeholders.
The companies will also be able to collaborate on future projects, which may also see them jointly developing the mine.
In May when the transaction was announced, Barrick chairman John Thornton said: "Our partnership with Zijin is the first step in a long-term strategic relationship with one of China’s leading mining companies, a multi-faceted partnership that will provide significant opportunities to work together on an ongoing basis as we continue to create value for our respective owners."
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The gold and silver mining operation Porgera began production in 1990 and was developed and operated by Placer Dome which was acquired in 2006 by Barrick Gold.
In 2009, the mine produced 572,595oz of gold, 94,764oz of silver and has proven and probable mineral reserves amounting to 8.1 million ounces of gold.
Image: Looking out across the lower half of the Porgera processing plant, and down into the Porgera valley. Photo by Richard Farbellini via Wikipedia.