Barrick Gold Sells Hemlo Mine for a Massive Price

In a groundbreaking move that marks a pivotal shift in its strategy, Barrick Gold (NYSE: B; TSX: ABX) has officially announced the sale of its last operating gold mine in Canada, the Hemlo Gold Mine, to Carcetti Capital Corp. for an impressive $875 million in cash and $50 million in Carcetti shares.

Unlocking Value at Peak Gold Prices

This monumental $1.1 billion transaction arrives at a time when gold prices are soaring. The sale not only allows Barrick to leverage its legacy asset but also opens a new chapter as the company shifts its focus heavily towards copper.

What's Next for Carcetti Capital?

Following the acquisition, Carcetti plans to rename itself Hemlo Mining Corp. To fund the purchase, they have secured a significant $400 million streaming agreement with Wheaton Precious Metals. This pact entails Wheaton acquiring 13.5% of Hemlo's gold production until 181,000 ounces are delivered, followed by further decreasing percentages until the mine's life concludes.

Market Reactions and Future Projections

Despite the impressive sale, Barrick's shares dipped 1.4% in Toronto, adjusting the company's market capitalization to approximately C$68.84 billion ($49.7 billion). BMO Capital Markets had previously valued Hemlo at around $620 million based on long-term forecasts, but the current sale suggests a staggering $3,150 per ounce of reserves—well above the predicted $2,200.

A Strategic Shift Under CEO Mark Bristow

This sale aligns perfectly with CEO Mark Bristow’s strategy to diversify Barrick’s portfolio. Since acquiring Randgold Resources, Barrick has been progressively distancing itself from Canadian operations, relocating head office functions out of Toronto and reducing its executive footprint within the country.

Canada Remains Key Despite Mine Closure

Even with Hemlo's exit, Barrick insists that Canada continues to hold strategic importance in its portfolio. The company is pursuing a range of early-stage projects and exploration targets, indicating that it remains committed to finding and operating high-quality gold and copper mines.

Hemlo's Historic Production and Future Potential

The Hemlo mine has an impressive track record, having produced over 21 million ounces of gold since its discovery and generating 143,000 ounces in 2024, equivalent to about 3.5% of Barrick's total output. Notably, Barrick has been active in shedding non-core assets, including a $1 billion divestment in Alaska earlier this year, with total gross proceeds from such transactions expected to surpass $2 billion by 2025.