Shandong Gold purchases 50% stake in Barrick’s Veladero mine

Shandong Gold purchases 50% stake in Barrick’s Veladero mine

China’s Shandong Gold Mining will buy a 50% stake in Barrick Gold Corp’s (NYSE:ABX) Veladero gold mine in Argentina, in a deal worth US$960 million.

The deal will also open up doors for further joint venture opportunities between the two miners across the El Indio Belt, a mineral-rich region straddling the border between Argentina and Chile.

In particular, the undeveloped Pascua-Lama gold and silver project in the Andes mountains has been highlighted as a potential joint venture prospect between the companies.

Barrick’s executive chairman John Thornton said: “Shandong is an ideal partner to help us unlock the untapped mineral wealth of the El Indio Belt over the long-term, while working with us to generate more value from the Veladero mine today.”

The deal is the culmination of a strategic partnership between the Chinese and Canadian firms, which began when the companies first met in April 2016.

“We are excited to enter Argentina’s dynamic mining industry in partnership with Barrick at Veladero, while exploring other opportunities in one of the most prospective mineral districts in the world,” said Shandong’s chairman Chen Yumin.

The Valadero mine is expected expected to produce between 770,000 and 830,000 ounces of gold in 2017.