Barrick prepares to start sale of Massawa gold project

Barrick Gold Corp. is working with advisers to find a buyer for its Massawa gold project in Senegal, which it acquired as part of its purchase of Randgold Resources Ltd., people familiar with the matter said.

The asset could fetch a value of about $500 million, the people said, asking not to be identified because the deliberations are private. The company aims to kick off a formal sale process shortly for part or all of its stake, the people said.

Barrick is targeting $1.5 billion in asset sales through 2020 following the company’s $5.4 billion takeover of Randgold completed in January. The gold mining industry is consolidating quickly, and the biggest producers have been selling off smaller, unwanted assets as they merge.

Massawa is an an example of a project where Barrick could sell part of its stake to another miner operating nearby, CEO Mark Bristow said

Acquisitions of gold miners are up nearly sixfold over the last 12 months to about $27 billion, according to data compiled by Bloomberg. No final decisions have been made, and there’s no certainty the deliberations will lead to a sale of the Massawa project, the people said.

A spokeswoman for Barrick declined to comment.

Barrick owns about 83% of the Massawa project, according to its website. The asset is located in eastern Senegal, about 700 kilometers (435 miles) southeast of the capital city of Dakar.

Massawa is an an example of a project where Barrick could sell part of its stake to another miner operating nearby, Chief Executive Officer Mark Bristow said in a May interview. Other companies in the area include Toronto-listed Teranga Gold Corp. and closely held Toro Gold Ltd., Bristow said.

Barrick walked away from a nearly $18 billion bid for Newmont Mining Corp. earlier this year, opting instead for a joint venture around the two companies’ Nevada mining assets. Newmont in April agreed to buy Goldcorp Inc. in a deal valued at $10 billion, becoming Newmont Goldcorp Corp. in the largest takeover of its kind.