Barrick rumbles as gold tumbles

Gold took a pounding over the Oct. 29-Nov. 4 report period, withering US$8.25 in overseas trading to settle at London morning fix of US$378.30 per oz. Silver also got smacked, losing US22 to finish at US$4.93 per oz.

Barrick Gold made headlines but not the kind it welcomes. A U.S. court will not reconsider its decision to allow an anti-trust suit against the major and J.P. Morgan Chase to proceed, meaning the suit now moves to the discovery phase. Last December, New Orleans-based coin and bullion dealer Blanchard & Co. accused the two of having colluded to rig the gold price and monopolize bullion trading. Barrick finished the period at $25.30, down 8.

Placer Dome rose 27 to $19.95 despite announcing a 28% drop in third-quarter earnings as derivative charges weighed on the company’s bottom line. The reduction actually came on record output, though that simply reflects the major’s takeover of AurionGold in late 2002 and of East Africa Gold Mines in July 2003.

Mid-tier producer Agnico-Eagle Mines took a heavy blow after posting a dismal quarter that put its losses in the first nine months at US$21.9 million. By comparison, the company earned US$3.2 million in the first nine months of last year. The drop reflects production shortfalls arising from a rockfall earlier this year at the LaRonde gold-copper mine in Quebec. Agnico-Eagle plummeted $3.92 to end the period at $14.22.

Glamis Gold fared much better than its peer, slipping only 4 to $18.61. Although the company produced less gold in the recent quarter than in the comparable one of last year, it realized a much higher price for its output and thus pocketed more profits.

Ivanhoe Mines stole the show in the base metals sector, spiking to a new 52-week high of $15.15 on Nov. 3 before settling back to $14.21 by the period’s close for an overall gain of $2.98. The polymetallic miner has agreed to pay $94 million to BHP Billiton for a small royalty the major has in the Turquoise Hill copper-gold project in Mongolia.

Also up on good news was Falconbridge, which got the official greenlight to proceed with a $100-million development program at the Montcalm nickel project near Timmins, Ont. Run-of-mine ore from the 5-million-tonne deposit will be concentrated at the Kidd Creek plant and smelted in Sudbury to contribute about 8,000 tonnes of nickel to the major’s annual production profile. The announcement combined with stronger nickel and copper prices to push Falco up $3.05 to $26.15.

Among the more active issues was Tahera, which jumped 5 to 21 as about 50 million shares changed hands. A group of brokerage houses has agreed to place $8 million worth of units at 16 apiece to help the junior advance its Jericho diamond project in Nunavut. A unit consists of a share and half a warrant, with a full warrant entitling the holder to buy another share for 36 months after the deal’s close, at 22.