DBRS Morningstar Confirms Barrick Gold Corporation’s Issuer Rating at BBB With a Stable Trend

DBRS Limited (DBRS Morningstar) confirmed the Issuer Rating of Barrick Gold Corporation (Barrick or the Company) at BBB with a Stable trend. The confirmation takes into account Barrick’s success in 2021 in applying new geologic models at its 61.5%-owned Nevada Gold Mines (NGM) joint venture with Newmont Corporation. The new models incorporate the combined data from both companies and resulted in an increase in reserves by approximately 11% net of depletion in 2021. Given the large resource at and around the NGM properties, the new approach has the potential in the near term to improve the Company’s business risk profile for Reserve Quality and Related Attributes. The Stable trend reflects DBRS Morningstar’s expectation that Barrick’s financial risk profile will remain at the high end of the “A” range based on the forecast for gold prices (Bloomberg consensus as of May 24, 2022). DBRS Morningstar notes that there remains significant risks to the global economy from the Russia-Ukraine war escalating inflation due to supply chain disruptions, especially energy, and the rapid tightening by central banks seeking to rein in inflation. Barrick’s business risk profile is assessed at the upper end of the BBB (low) band based on the Company’s robust reserves, low operating cost structure, and position as an industry leader. The Company has a favourable liquidity profile as of March 31, 2022, with $5.9 billion of cash, $3.0 billion in undrawn credit availability, and no material near-term maturities.

Barrick also has an attractive pipeline of brownfield growth projects. Two of the most prominent are (1) the Third Shaft development project at the Turquoise Ridge operations in Nevada that is on schedule and budget to be commissioned in late 2022 and (2) the Plant Expansion and Mine Life Extension project at the Pueblo Viejo (PV) operations in the Dominican Republic. At PV, the plant expansion is scheduled for completion by the end of 2022, and Barrick expects to submit the permit application for additional tailings storage capacity in Q3 2022. The construction of a new tailings storage facility will provide the opportunity for the conversion of approximately 9 million ounces of resources to reserves and extend the mine life out to the 2040s, which could materially improve the Company’s business risk profile.

On February 3, 2022, Barrick announced a new quarterly performance dividend policy that pays out a portion of surplus cash above outstanding indebtedness. If the cash surplus after this dividend is used to acquire assets that are significantly accretive and improve Barrick’s business risk profile, a positive rating action is possible. Conversely, a negative rating action could result if gold prices decline significantly for a sufficient period of time to cause a material deterioration in Barrick’s key credit metrics to the point at which the Company’s credit metrics do not support the rating.

ENVIRONMENTAL, SOCIAL, GOVERNANCE CONSIDERATIONS
There were no Environmental/Social/Governance factors that had a significant or relevant effect on the credit analysis.

A description of how DBRS Morningstar considers ESG factors within the DBRS Morningstar analytical framework can be found in the DBRS Morningstar Criteria: Approach to Environmental, Social, and Governance Risk Factors in Credit Ratings at https://www.dbrsmorningstar.com/research/396929/dbrs-morningstar-criteria-approach-to-environmental- social-and-governance-risk-factors-in-credit-ratings.

Notes:
All figures are in U.S. dollars unless otherwise noted.

The principal methodology is Rating Companies in the Mining Industry (August 16, 2021; https://www.dbrsmorningstar.com/research/383106), which can be found on dbrsmorningstar.com under Methodologies & Criteria. Other applicable methodologies include the DBRS Morningstar Criteria: Approach to Environmental, Social, and Governance Risk Factors in Credit Ratings (May 17, 2022; https://www.dbrsmorningstar.com/research/396929).

The related regulatory disclosures pursuant to the National Instrument 25-101 Designated Rating Organizations are hereby incorporated by reference and can be found by clicking on the link under Related Documents or by contacting us at info@dbrsmorningstar.com.

This rating was not initiated at the request of the rated entity.

The rated entity or its related entities did not participate in the rating process for this rating action. DBRS Morningstar did not have access to the accounts and other relevant internal documents of the rated entity or its related entities in connection with this rating action.

This is an unsolicited credit rating.

The conditions that lead to the assignment of a Negative or Positive trend are generally resolved within a 12-month period. DBRS Morningstar trends and ratings are under regular surveillance.

For more information on this credit or on this industry, visit www.dbrsmorningstar.com or contact us at info@dbrsmorningstar.com.

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