Barrick sells Chile gold project to Boroo for $50M

Barrick Mining (NYSE:B; TSX:ABX) is selling its Alturas gold project in Chile to a Singapore-based unit of Boroo for $50 million (C$69 million) in cash, plus a 0.5% net smelter return royalty on gold and silver production.

The royalty will end once 2 million oz. of gold and gold-equivalent are produced. Privately-held Boroo can buy it back within four years for $10 million, Barrick said on Friday.

“This is another good example of an instance where an asset we own might be better suited in the hands of others while we pursue our priority portfolio of Barrick-managed growth projects,” President and CEO Mark Bristow said in a release.

Alturas sits in Chile’s gold-rich El Indio district, 30 km south of the former El Indio mine. Barrick announced the discovery in 2015, saying it was geologically similar to its giant Veladero gold mine across the border in Argentina, with potential for significantly higher grades.

While exiting Alturas, Barrick said Chile remains a key jurisdiction for the company, where it still holds interests in the Zaldivar copper mine and the El Alto and Norte Abierto projects.

Boroo is advancing the $382-million capex Lagunas Norte gold project in Peru that might produce 1.62 million oz. of gold and 4.61 million oz. of silve over 12 years, according to a January prefeasibility study.