Ladies and gentlemen, thank you for standing by. This is the conference operator. Welcome to the Barrick 2021 Fourth Quarter and Year-End Results Conference Call. During the presentation, all participants are in a listen-only mode. Following the presentation, we will conduct a question-and-answer session. [Operator Instructions] As a reminder, this conference call is being recorded, and a replay will be available on Barrick's website later today, February 16, 2021. I would now like to turn the conference over to Mark Bristow, Chief Executive Officer. Please go ahead, sir.

Thank you very much. And very good morning to everyone, and good afternoon to those on the other side. And again, welcome to Barrick's quarter four and year-end results presentation. It's been three years now since we started on this journey. And Barrick is clearly achieving its goal industry-leading value creation and sustainable profitability, as I'm sure, you’ll agree with me when you review our results for 2021. By any measure you apply, returns to shareholders, strength of balance sheet, peerless assets, prospect pipeline, a long record of exploration success and delivery on our commitments, Barrick is a leader in the sector. And the fact that our share price does not reflect us makes Barrick’s case for investment even more compelling. Please take note of this cautionary statement, which is also available on the Barrick website. So, let's start by looking at last year's highlights. And you couldn't possibly get a better set of KPIs. We delivered on our production guidance for the third year in a row. Nevada Gold Mines confirmed that it is indisputably the world's number one gold complex and achieved a quarterly production record for quarter four. Copper's contribution to the bottom line is increasing. All our operational sites maintained or achieved their ISO health and safety and environmental accreditations. We more than replaced our reserves, net of depletion at a better grade. Our wealth of advanced exploration targets will support this replenishment and consequently, our business plans well into the future. And finally, we generated significant cash flow and materially increased returns to shareholders. The operating results reflect a good all round performance, including meeting production guidance for the third year in a row, notwithstanding some considerable headwinds during the year. And the financial results also show we did well against the leading and lagging…

[Operator Instructions] Our first question is from Cleve Rueckert with UBS. Please go ahead.

Great. Thanks for taking my question. And congratulations on finalizing the dividend policy and a good set of results, Mark and team. I've got two questions. The first, Mark, just on the 10-year outlook on slide 28. I appreciate you gave just a synopsis of a couple of the areas that could add to that forecast. Aside from Porgera, I don't know if you could give us a little bit more color on potential growth opportunities kind of before that 2027 time frame that's laid out there on the slide, where, if you have any confidence in adding to that outlook kind of in the near term?

Yes. So, of course, in the near term, we've got some opportunities -- some real opportunities, and you've touched on Porgera already. In Nevada, again, we've got some very exciting new targets, both adjacent to known infrastructure and projects that we have initiated, like looking at the gap between Twin Creeks and Turquoise Ridge. And we've got some more new greenfields exploration across the Nevada complex. We are looking to grow our opportunities in DRC at the moment. We have got some very interesting opportunities that we are evaluating. As I touched on, we've got some exciting exploration ground in Senegal, across the river from Loulo-Gounkoto. We are continuing to work on the portfolio of projects that we have along the Andean trend. And again, our big focus is adding life to Veladero. And Veladero in itself is part of the Pascua-Lama infrastructure. And again, as I've said in previous presentations, we are working really hard at trying to define the resource base, particularly in the Lama side of the Pascua-Lama project, which is in the Argentinian side. And we have a target of 2024 to try and get our head around the prospectivity of the many targets those we inherited from the previous Barrick management. And so -- and then, of course, there's the challenge of realizing the arbitration award that we received in favor of the Reko Diq project in Pakistan, and that's something that is a key component to something, that's not reflected in our share price. And at the same time, we've opened up new frontiers, as I touched on, Egypt. We are busy working there. We are looking at expanding our partnership with Ma'aden in Saudi Arabia. We've got geologists now working in Guyana in South America and also Ecuador. So, again, we've pushed out…

And sort of switching gears a little bit, thinking more about capital allocation. I know you'd like to talk about M&A. You’re sort of always assessing M&A. It seems like sort of the deal, at least the competition for deals has been somewhat intense over the last couple of years. I guess, this presentation really focused a lot more on the organic growth opportunities, and now you're sort of reinforcing the buyback and the dividend. I mean, is your thought process around M&A changed at all in the last couple of months or last year?

Not at all. And as you know, I talk a lot about M&A and have done very little. But the M&A that we've done has been value creating, indisputably value creating. And I think I would point out the competition for M&A at the moment is a competition to survive. And so, you get these very high priced deals. And we don't do deals like that. So people know that. We've been around, as you know, you've known me for a long time and some of the audience even longer. And so, we look at -- we've got a very strict filter in the way we assess opportunities. And I think we were going reasonably well. I think ourselves with our deals and the acquisition by Newmont of Goldcorp created real value for this industry. I reflect on some of the recent transactions sort of brings back memories of 2012 and 2013. And we're not in that business. And we don't have to do those sort of transactions. We don't have to buy things to extend our life. We've got a solid platform, the same as we had in Randgold Resources. And our intention is to build on that value platform that we've created. And we set out to do that. In 2018, when we announced the merger with Randgold, we were very clear that our focus was high-quality assets run by the best people, focus on profitability and real sustainable returns to our shareholders, and that's what we intend to continue to drive it.

Our next question is from Josh Wolfson with RBC Capital Markets. Please go ahead.

So understandably, strategies and philosophies change over time and adapt to the market. Historically, for Randgold and Barrick share buybacks have not been one of the primary factors for capital allocation. As part of the new strategy, it is something which is more prominent. Mark, could you perhaps walk us through perhaps what's changed and why this is the right move?

So, Josh, for as long as I've known you, you've been trying to change my strategy. That strategy has been pretty focused and clear. And at the same time, we react to certain situations. And one of them is that we feel that the share price is not being properly valued. And so, it makes sense to clear the opportunity, clear it with the market, the opportunity to buy back stock in a situation like this. So, I can't -- I don't understand how you can say that's a change in strategy. I mean, it makes sense. It's a provisional approval. We can do with it -- we can use it for the right reasons, and we've been very clear about that. At the same time, we are very focused. We've -- as I promised you and the rest of the crew three years ago, we have delivered a revised dividend policy based on the strength of our P&L. And that's always been the strategy. I don't believe in creating dividends or borrowing to pay dividends. We've always paid -- I've always paid dividends based on the strength of the P&L. And to be able to have a strong P&L, you have to have quality assets. And so -- and you need to clear up your balance sheet and your debt structure, which we've done. So, everything is ticking the boxes. And 2018 September, we very clearly said that's what we're going to do: take out the debt, clean up the balance sheet, focus on high-quality assets and return real value creation on a sustainable basis for our shareholders and other stakeholders as well.

All right. I'll do my best to try to refrain from changing the Company's strategy, but don't hold me to it. On the new sort of five-year outlook, looking at the production, it looks -- and granted, we're working with our geometry sets here. It looks to touch lighter in maybe 100,000 ounces over the next couple of years. What would that be attributable to? Is that a function of PV, or are there other factors in there?

So, there's the -- this year, there is a change in the balance because of the expansion in Pueblo Viejo, which we've communicated some time back, and that drops the production by 100,000 ounces. It pulls back up immediately next year as we finish the completion of the expansion. And you know the background behind that. The growth side, so going from 4.4 to 4.8 is very clear. There's -- the other change has been the suspension of operations at Long Canyon. And again, for that asset, we're reviewing whether we keep it in our portfolio or not because, again, we're very focused on the quality of our assets and the longevity of the assets. And the other one is -- will be Hemlo where we've reset the ramp up. And so, that's -- we've slowed that profile as we wrestle with getting that mine back on track. And that mine went through some challenges with COVID and the -- we made a commitment to bring in contract miners and then COVID blocked -- shut down the ability for the Australian teams to come in to Canada. And so, we're reassessing that operation. And those are the impacts on that profile. But the profile still is -- I don't know what sort of accuracy your ruler is, but it takes us back up to about the 4.8 million ounces. And remember, these are ounces and plans that we have clear, they're not forecasts. They're actually plans.

Our next question is from Matthew Murphy with Barclays. Please go ahead.

Hi. Similar question on the charts, guidance, outlook on CapEx, though, this time. The way I'm looking at it, it looks like CapEx is up around $200 million to $300 million a year. Do you disagree with that? And if it is up, what is the -- what are some of the drivers there?

So, yes, just for capital sake, one of the biggest drivers on capital is the decision to -- I mean, the whole focus on Lumwana. The fact that the African and Middle East team got their head around, Lumwana got the cost down, they halved the mining costs. We've -- there's a bigger investment in investing in their equipment. We've got some additions to make to like the crushing circuit and so on. That's a big change. The capital in Porgera -- and ramping up Porgera, that's not in the forecast yet, the capital for Porgera. So then, it's -- so I'll pass it on to Graham, he can finish the explanations.

So, thanks, Matt. I mean, the key drivers, as Mark has already touched on is, it's the -- some of the changes in the mine plans. We've obviously had some carryover of capital from 2021 into 2022 and a little bit beyond related to the delays in the PV expansion. That was our biggest growth capital project, and that's carried over a little into 2022 because of the supply chain -- global supply chain constraints that we've had there. The other area where we are investing more is in the copper business in Lumwana where historically, that's a business that has been a little starved of capital. And we we're really investing in that business because we see a lot of growth opportunities. And you can see that in the profile of the Lumwana ramp-up over the next five years, where we've got new fleet and other initiatives that will increase our availabilities. So, that's a big factor coming through as well.

And Matthew, the most important thing is the next year is our last big capital year, and then it starts coming down. And that's the driver. When you look at Barrick and its five-year plan and all you need to do at the end of the five years is continue those graphs for the 10-year plan. What you do see is a growth in cash flow, free cash flow because of that declining all-in sustaining cost. And so, whatever gold price you run the model at, you get an increasing cash flow in the 10-year plan. And that's -- a lot of people say, this is a flat production profile. Yes, but it's long and it's exploiting a capital base that we will have completely invested in by the end of next year, early the following year, and then you can -- and you get the benefits of that over a long period. Graham?

Yes. The only other point I was just going to make was just in the AME region where we have got a little more capital in Tanzania, which is related to the redevelopment of those plans that Mark has already talked about. So, the ability for us to be able to ramp up that production following the completion of the feasibility study at Buly as well as the mine redesign at North Mara, where we've now got both the open pit and underground coming back into the plan. So, there's a little more capital in there. And then at Loulo, where we've got the expansion to our solar plant. So that's all linked into our GHG reduction plans where we're investing in solar capacity.

And we've got the extra 200 megawatts in Nevada as well. And I would just point out, Matthew, those -- our program, our path to 30% reduction that we've detailed. All those projects are delivering 15% IRRs at $1,200 long-term gold price. So they're all -- as much as they knew and they're dealing with our greenhouse gas emission commitments, they do reduce the costs and deliver real returns as a business, as an investment.

Hey Mark, is that with a carbon price, or is that just business as usual doing that?

It's just business as usual. And one of the things we stuck with is we didn't get caught up in this rental stuff. We waited until the solar technology and market was as such that you could own your own solar cells and install and derive the full benefit of solar energy. And again, Barrick, with the experience we've developed in Africa as well is that we've grown our knowledge and understanding of micro grids and power generation. And that roadmap to 30% reduction is a real engineered, modeled project processed investment. It's not a promise without a plan. It is the plan to support the promise.

Our next question is from Jatinder Goel with BNP Paribas. Please go ahead.

Couple of questions. One on dividend policy. It's good to see aligning it almost to a Randgold days and basing it on net cash. But just to understand, is there a maximum net cash balance that you want to keep in balance sheet and pay everything beyond that away, or is $1 the maximum dividend that Barrick will pay in any given year? And maybe any access gets funneled through buybacks if the share price allows that?

So, the concept here is that we want to grow this business. We set out when we did the deal with Randgold, we want to build a real business, a business that's relevant in the public markets. And so, part of that is building a stronger -- ever stronger balance sheet. At the same time, we want to have that commitment to our shareholders, where you can look at our plans and expect -- and know what sort of yield you'll get from the payout. So, right now, we stop at -- it's $1 billion -- $1 billion to $1.5 billion and that payout. So, that payout keeps going. Not to say that we wouldn't revise it, but that's a good start. We've got to get to the $1.5 billion net cash.

I think the point is it's a self-correcting formula. So, every quarter, we look at where the cash is and we pay out accordingly. So, to the extent that we don’t pay out cash this quarter, that cash is available for a performance dividend next quarter. So, it -- that's how the formula works, effectively. So, provided we're net cash, we are looking to pay a performance dividend.

Okay. Thank you. Just one on Porgera, it looks very ripe for an imminent restart. I understand why you would exclude it from the guidance. But, are you able to provide any more color on the possible time line of restart? And how long will it take to get back to full capacity?

So, just let me explain to you where we are. So, we signed a framework agreement, it was binding. We now recently signed the commencement -- so the Porgera Project Commencement Agreement, PPCA. And that sets the -- it takes the framework agreement and enhances that agreement, gives us more surety on the investments we're going to make. It clarifies the rights of the various shareholders and opens the way for the incorporation of a new Porgera vehicle company. And to do that, of course, we need shareholders' agreement and a constitution, company constitutional. And so, we've now settled those -- the terms of those agreements. We need to get it signed, and that's a step. It's a process because of the fact that there are more than one stakeholder on the Papua New Guinean side. Once we do that, we then have the ability to apply for the SML, the Special Mining License, and roll the exploration licenses and other permits from the old Porgera into the new Porgera. That's a process in itself. And then, we are -- but the negotiations and legal process is complete on that. And then, we've got to settle the operators agreement. The framework of that is set in the framework agreement. And the other key process to be dealt with is the Development Forum, which is a provision under the PNG law, which -- whereby the various landowners and other interested groups get together and under the MRA stewardship and allocate to them amongst themselves, the equity that's been reserved for the landowners. And once that is done, we're ready to commence with the restart. What we have done in the interim, as part of care and maintenance is we've cleaned up the pit. We've cleaned up the underground, taken all the muck out of there. We've also reviewed and done some servicing on the mobile equipment. We're currently now working through the processing plant just to make sure that everything is operational. So, we have done a little bit of operational readiness work ahead of the final proper restart. And again, the restart period will be around six months, depending on exactly when we start the restart and how much interim work we've had completed.

Our next question is from Anita Soni with CIBC World Markets. Please go ahead.

So, most of my questions have been asked and answered, but I just wanted to get a little bit better understanding on Lumwana and where exactly you are spending the -- in terms of sustaining capital and growth capital breakout. That would be the first question.

So, Anita, as I said, a large -- we've got a new fleet. We bought part of it. It's still coming. We're upgrading the whole fleet. The team -- we went in there. We dropped the mining cost by nearly 50%, but the fleet was an old fleet. So, that's one that I know we've still got more fleet to arrive. We've got some upgrades to some of the equipment that we'll keep. And then also, there's some work to be done on the crushing circuit as well, so. And that really takes us to the sort of -- I'm wanting to say 350 million pounds of copper. Hey, Graham?

Yes. 100%, yes.

So, that's the plan. And then there's an additional point to some of -- to add, not a large amount of money, but significant is some of the exploration we're doing, we've identified some new satellites. And under the current mine plan, 2026ish, we've got to make a decision on a big super pit pushback. But some of the exploration work we're doing is indicating that we have -- we could be able to define some better grades and lower strip ratios that would delay that decision and extend the life. And the current super pit will go for 60 years And if we can add more lower strip material into the plan, we will extend that decision till later. And Graham, do you want to add anything more?

No, the only thing I would just say is it's all sustaining capital. It's basically plant upgrades, fleet upgrades. It's all about making sure that we can do all the tons, both the waste tons as well as the mining and make sure that we get the availability and the throughput through the plant, and that will deliver..

And Anita, you know we -- at one stage, we were going to sell this asset. We couldn't get -- we knew the value at that time. But as the team in Africa got their head around this operation, we were very comfortable that they got it down to making money at $2.75 a pound, and so we shifted our strategy. And we're now reinvesting in this long life operation.

I was actually -- I was looking for Graham short answer, but your answer actually leads into my next question, which was -- a lot of investors are looking for copper exposure. You've talked about copper as a strategic assets previously talking about an M&A context. Is it fair to -- I mean, I'm just trying to get an idea of what the copper like it doesn't really explicitly say your tenure profile what the copper production would look like? Should we expect that to grow beyond the 500 million pounds, it's sort of into the back half of the decade with these investments that you are making at Lumwana right now and could potentially make as you say, you might have to make a decision on the super pit? And then what would that spec cost ballpark

So super pit is just cost of stripping. And again, exactly how we manage that strip is -- will be premised on what we do as far as exploration and adding additional resources. We're very comfortable that we're going to add some significant resources and reserves, both at Lumwana, which is a big operation and also at Jabal Sayid. So for me, we have every intention of growing our business, both in copper and in gold or in gold and then in copper. And the principal behind Barrick's business philosophy is high-quality assets. That's our focus. And so that's what we're hunting, whether it's gold or copper. And by the way, as you know, Barrick has always had a copper portion of its business, unlike many of the gold miners. The point is that the copper business never made a real contribution to Barrick's bottom line. Today, it is, and it does so even at $2.75 a pound. So that's all we've done. We haven't just shifted anything. We've just had a look at our business. We looked at selling it. We couldn't get the right price. The team felt they could do a better job than the past, and they certainly have and it's now a very significant assets in our portfolio. Do you want to add?

No, I'd just say, Anita, if you look at the copper graph, you'll see the growth over the 5-year period. And as Mark has alluded to, when you look further out within the 10-year period, you can see Lumwana getting up to 350 million pounds.

And I think, Anita, at this stage, let's get our business settled on the copper side. We've got a lot of opportunities on the gold side, and we'll keep the market updated on new opportunities as we -- but what we have done, as I said, we've opened this new frontier in Asia Pacific. And we now have embedded copper expertise, additional expertise in our exploration teams, both in Africa, in the Central African copper belt region and also in our LatAm teams, our South American and Central American teams.

Okay. And then a quick one on the Record of Decision you mentioned, I think a little bit -- I hope I'm not speaking at Cortez. Was that pertaining to Goldrush's Record of Decision or was it pertaining to the Cortez one where you can go deeper and below the water table?

The expansion I was talking about in Cortez is all about Goldrush at this stage. We have some very exciting exploration new models in Cortez underground that we're busy drilling. We touched on that if you read the MD&A that we're covering. But this is -- currently, it's the business plan. So it's what we've got in Cortez. We've got some other additional Robertson and pipeline that we're working on. And then really, it's the -- it's the post Record of Decision, Goldrush, which, as you know, we've signaled that it should be in place by the end of this year.

Our next question is from Jackie Przybylowski with BMO Capital Markets.

Also most of my questions have been answered already. I just maybe want to follow-up with what Jatinder was asking earlier and just ask you a little bit more explicitly. How this buyback now for $1 billion? I know what we've seen from other companies, not Barrick, when they disclose the buyback. They sometimes completed, executed, sometimes they don't. Can you talk a little bit about what your commitment to executing on the buyback is do you fully intend to finish the $1 billion by the end of the year? Or is this something that will be more discretionary?

So the best thing for you to do, Jackie, is to read the MD&A because it's very clear there. And again, this is about a view that we have about the value of our stock -- and again, we might spend it all. We might spend a little part of it. It depends on the market and how the -- how we feel and -- about the value of our stock in the market against the other things that we can spend the money on.

And just maybe following up on that. Is that -- that's your priority, that your preference to be -- to continue to grow? I know you have mentioned that and I did read the MD&A. I know that growing the business is a priority. Is that first priority? And either the buyback or the special dividend, we should think would be kind of secondary to your growth opportunities?

Well, I think the dividends and the growth are not mutually exclusive. As I've always said, we focus on 15% returns at gold price is much lower than they are today. At the same time, and I've always believed and demonstrated, if you have that sort of filter and discipline, you should get to a point where you can do both, invest in your future and continue to make returns. And a classic example is last year, we returned $1.4 billion, a record return, cash returned to our shareholders ever. And at the same time, we continue to invest some significant capital. This is to really make sure that we've got a solid platform to deliver the 10-year and beyond plans that we have in our big operations.

Our next question is from Greg Barnes with TD Securities.

Mark, with the $200 million in dividends paid out of Kibali from the DRC in the second half of the last year, have you opened that avenue to get dividends out of the country formally now, the legacy $500 million is the progress we made on that as well?

Yes, we have, as I told you when I spoke at your conference, Greg. So we're expecting another $300 million imminently this month. And then that will be followed by another $300. And the deal that we've got is we will pay out the money for specifically to pay down the debt with the next $1 billion. And that's where you get your $500 million from because it gets divided between. It's just over $1 billion after the $200 million dividend payment. The dividend payment was the first step, as we pointed out in the announcements today. And then we'll pay out the $1 billion just over $1 billion, everyone gets the 2 major shareholders get 500 because it goes back to pay that. And then going forward, we will pay 50-50, 50 to dividends and 50 for the continued reduction in debt. And it's important that people understand that it's -- this process, and we've done it in Mali as well, allows everyone to benefit. The government gets a foreign exchange fee on the loan repayments. It gets a withholding tax payment on the dividends. Our partners, which is the state mining company, get dividend benefits going forward. And we don't wait for the end of the project for everyone to benefit. So that's the way we've been and we've never -- there's been a issue in the market about this money, but it's never been -- as you know, I haven't made a big fuss about it. It's never been under question. It's just when it should be paid. And so we've got to that point. And I explained to you in the past, the reasons for that. But we've got to that point now.

Fair enough. And just, Mark, a risk of going down the M&A question root again. But I think everyone agrees that paying the premiums on using assets makes a lot of sense, and we demonstrated that it works. But should the gold post be a bit wider when you're looking at the development project or an exploration-stage project to bring something that looks very attractive into your fold?

Sure. And that's a matter of what we agree. But to pay an infinite premium on an asset that's got no permits, no resources, nothing is not -- doesn't fit our criteria, and you might get lucky. But I've never gambled in in the way I run our business. So we have a very solid technical team at the corporate level and supported by competent in-country skills. And again, we will pay a premium on something if we can see the benefit in the geological model or something that we feel we can unlock. We're not sort of blind to opportunities as we've demonstrated in the past, Greg. But just -- we -- some of these assets that were dealt last quarter, they've been around a long time. We, as an industry, all walked away from them at much lower gold prices. And one thing for sure, as you've been around as nearly as long as me, $1,800 gold marks a lot of issues in an asset. And again, all these assets had too much soon-to-be-discovered opportunities baked into the value and then a premium on top of that. So we won't do it.

Our next question is from Patrick Peura with Alliance Investment Management.

Mark, thanks for your continued focus on sustainability topics, especially on today's call. We believe that this requirement is necessary in your sector, not as a competitive advantage, but as a competitive necessity. We're also looking forward to your sustainability report and appreciate the work by Grant Beringer there. With this in mind, on your 30% reduction for 2030, you have a road map laid out, which is primarily solar and natural gas conversions. Can you provide a little bit of color on the biggest additional projects that you have under investigation for this target?

So we've started way back already with a big conversion of gas of heavy fuel to gas and DR. We've built a lot of additional capacity to manage microgrids and DRC. We've installed a big battery in the DRC. We're going to put in more batteries now. And really, what it's designed to do is completely take out the spinning reserve, the thermal spinning reserve during the big water periods, the big high river periods. And the way it works is we originally tested the battery on managing the demand of the shaft, the hoist. And it was pulling lots of power, and we had to spin diesel engines to deliver that power when the demand was there. What we've done is put a battery in there. So the hydro then keeps the battery charged and the battery can react to that demand. What we're looking at now is expanding that battery capacity and making the battery form the grid and then making sure that the hydro keeps the batteries charged. And so it's a much more efficient way to manage the power. And it's a significant improvement. And then with that knowledge, we've transferred it back to Mali, where we don't have a grid at all, and we don't have access to hydro, but we have a lot of sun. And so we trialed a 20-megawatt solar. It's worked exceptionally well. Now we're going to triple that and we're going to add battery bases to it. And so what we do then is that we make that solar much more efficient. And the impact on the heavy fuel machines. Well, the first thing is we would want to retire the highest-spending diesel machines, and we've got these big heavy fuel baseload machines. And again, we will be able to…

That's right, Mark. I think the only other one was probably the PV lime kiln. We're doing a field switch there from HFO to natural gas, and that will also give us around about 127,000 tonnes CO2 equivalent savings on an annual basis.

Okay. So Patrick, does that answer your question?

Mark, I would say we're also investigating the solar as well. That's one of the things we're looking into.

Patrick, are you happy with that?

Yes. Maybe if we shift to 2050, so thinking longer term, what role or need do you see from Poly regulatory and value chain support to make your and ICMM’s, all the peers that have committed at 0 2050 become more viable or more achievable?

Yes. I think, Patrick, one of the big dilemmas that we all have is the promise without a plan. And so we've never done that certainly in everything I've been involved in. And the big challenge is EVs and this expectation that they just magically we're going to deliver massive batteries that can hook up to a 300-tonne truck and it's going to be perfect. And likewise, with hydrogen fuel cell technology is quite a long way to go still. We are partnering with the our major equipment suppliers. We are investing ourselves and things like carbon capture. But the next big focus for us, and we are far down the road is dealing with Scope 3 emissions. Grant and his team have done a great job reaching out and understanding that. And we have set as our target for next year to be able to deliver a road map for that part. And again, it's a more challenging undertaking, but we are very clear that we want to work with our service providers, particularly our in-country service providers. And so -- and the focus has been for us is value-driven focus. So the big ticket items we're going to address first. In the meantime, we have got people dedicated to evaluating and driving the opportunity to build out more capacity for further reduction. And the one filter that we have, and we've done it, as I said earlier in the presentation, we've done all the whole road map we've shared with you, all of those projects deliver 15% -- they meet our investment criteria as if it was another business. And we believe that that's what's going to get the world to the right place. Because when people work out that the commercial attraction of doing this sort of work delivers returns. And it's not just about trying to please some demand with a promise.

Our next question is from Adam Josephson with KeyBanc.

Mark and Graham, good afternoon. Thanks very much for taking my questions. I appreciate you're doing so. Mark, can you talk about your gold cash cost and ASIC guidance for '22. You're expecting them to be up about 5%. I know you mentioned in the MD&A that it's the full year impact of the Nevada mining tax and general cost inflation, specifically energy. But can you just talk about the buckets that are comprising that expected 5% inflation? And how much is energy, labor, materials, et cetera? And then why you expect those cash costs to decline year-over-year in '23, if I read that slide correctly?

Okay. I mean Graham is well equipped. He's done it so many times. I just want to point out that one of the key drivers on the cost is we've always forecast our 5-year plan at $1,200 gold. We've changed that this year. I mean it doesn't change the production profile or the picture, but what it changes is it adds at $24, Graham, $24 to the cost. And -- so when you take that and then the cost out of Nevada is about $0.08 -- $8, sorry, and then you've got the 3% to 5% inflation. So when you back calculate everything, it all stacks up. And a lot of people look at it and they haven't done the arithmetic, and it works. And that's why we get close to what we say we're going to do and what we do or when we do it. So it's a real cost thing. Of course, there's ways to manage it. And again, the team -- we've taken $300 million out of our supply chain procurement business. We've got another $50 million to $80 million targeted this year in 2022. And again, we are -- that's what we do for a business is manage and mitigate costs focused on better efficiencies, invest in that efficiency drive. . And another aspect before I get Graham to touch on the minutia is we've also, as you all remember, rolled out a brand-new data platform, layer data platform that integrates all the information across the group. We've got 2 more mines to do, Porgera, of course, because we haven't started it. And Jabal Sayid, which we're busy with. But all the other operations are on the same platform, interconnected, and it's fully integrated. And now what we're doing is rolling out those reporting systems and processes, which where we can use this real-time data to improve our business. And that's definitely going to bring further efficiencies. And I would argue that we're the only large mining company that has a brand-new platform, fully integrated up to speed and modernized because it's new. So with that, I'll pass it to Graham and he can cut you the detail.

Thanks, Adam. I think as you already touched on, and Mark has touched on, we have been guiding for about 5% inflation, which is made up of various different buckets. The biggest bucket of that really is on the energy side. Obviously, particularly oil, diesel, a big impact on our costs. So we estimate that for every $10 barrel change in the price of oil, it's about a $6 per ounce impact on our cash costs. Similarly, natural gas has a big impact on costs. So again, about a $1 change in the gas price has about a $3 impact on our cash costs. It's not as significant because we -- our biggest exposure to gas is really Nevada and PV and not really at our other operations. So that's the biggest factor. That's probably of that fire. That's probably somewhere between 2% and 2.5% of that 5%. The rest is really made up of just cost price increases. One of the big factors that's been impacting us lately has been freight. So freight makes up about 5% of our landed cost. So you can see that it's not a massive impact, but it certainly has been impacting us in the short term. We believe that the constraints within the global supply chain will normalize within the next 6 to 12 months. So we think that's more temporary than a long-term issue. But certainly, we have seen situations where we've seen rates tripling, for example. Against that, we've been working hard to manage that in terms of consolidating our shipping, hiring direct ships to mitigate the cost of containers and just consolidating our buying and our shipping. The other one that Mark has already touched on is obviously royalties. And as he alluded to, the impact of the change in…

And just one follow-up on that. So from '22 to '23 in terms of gold cash costs, you all have the royalty issue presumably. And then you won't have the impact of the Nevada mining tax. So you're thinking that your cost savings efforts will more than offset any incremental energy, labor, freight, materials cost inflation. Is that the right way to think about it?

Yes. I think it's a combination of 2 things. It's partly to do with that -- those mitigants, but it's also -- when you look at the graph, a lot of the decline in cost is a function of increasing production. So we're effectively going from 4.4 million ounces to 4.8 million ounces. And so that increase in production, a large chunk of our costs are fixed So that's what really gives you that reducing cost profile.

Yes. No, I appreciate that. And Mark, just one on -- following up on Josh's question from very early in the call about the authorization. I you mentioned you the shares as undervalued, and I appreciate that. You said you had similar comments on the call 3 months ago, you thought Barrick, was a very attractive investment opportunity. But at the same time, you said, look, I'm not so sure. We're not in the business of trying to manipulate our share price, and they are perhaps better ways to return capital to shareholders than to buy back stock. And so have you changed your tune at all from what you were thinking 3 months ago? Does it seem like you view the stock just as attractive then as you do now?

No, we haven't. The point is that -- we've seen a big divergence from the -- some of -- well, one of our peers relative to the rest of the industry. And us against our peer group excluding Newmont is, we've been in line with performance. So it is a complicated challenge. But at the end of the day, it is my responsibility to worry about the value of our stock. And the first point is we got to convince the analysts that the stock is really valuable. We've delivered on what we've said. At the same time, we want to use all the leave that we can to address that. And what we've done is made sure that we have that because our stock went quite far down. And on a historic basis, it was relative -- even not according to consensus, it was undervalued. So we wanted to have the -- all the tools to deal with a lower stock price should prevail and should we see the opportunity to tidy up some of the sort of less well held shares.

And Mark, just on that divergence in valuations, is there anything that you would attribute that to? Do you think it's dividend policy? Do you think it's where you're domiciled, anything else that strikes you?

For me, look, you will recall, I have been through this exact same situation back in 2012 and 2013, where every time I stood up on the podium, people are banging the table saying, "You need to grow." And everyone was seeing growth and everyone is running around buying anything that they could. And we and Randgold, if you plot the Randgold share price, it lagged for a while until such time as these big deals didn't work because the gold price softened. And this way, we've got 2 ways to deal with that, inflation and the gold price cycle. And it's interesting from 2013, Randgold left the rest of the industry because we hadn't done any value-disruptive deal and we outperformed the industry all the way until the deal was Barrick in 2019. And we never -- you never close that margin. And so -- and that also lies because again, the level of analysis in the gold industry at these sort of gold prices is the gold price is always proving the analysts wrong because it's moving in different ways and no 1 gets the gold price right. And so for me, there are lots of different influences on gold stocks at this time of the cycle. And it's worth going back and plotting equities and the gold price started 2005. It's a very interesting graph to look at. And again, we at Barrick are really long term -- our focus is long-term value creation. It always has been. And so when we look at how we manage and communicate, we're looking at the long term. It's been a -- it's been my whole -- I mean my life is invested in Barrick, I'm fully committed shareholder. And so most of my -- in fact, all my colleagues and the executive team, we're all owners. And in fact, I don't know if you know this, but you have to have 5x your salary in equity to be part of our executive team. And so -- for me, it's a complex situation. Our discussion with our Board is -- and our shareholders is that some view that as -- that we shouldn't be sitting there watching our share price languish relative to anything else. And there are moments when it makes good sense to initiate some buybacks. And you can't do that at a drop of a hat. You've got to have it approved. And so we made sure that we address that, that particular tool that we need in our toolbox.

Our next question is from Tanya Jakusconek with Scotiabank.

Congrats on good end to the year and the shareholder return policies. I have 2 questions, if I could. I just need clarification on one. So my first question is on the DRC and the repatriation of your share of the $500 million. I just want to confirm that you have all of the necessary signatures in place to take the money out of the DRC. And if you do, just a mechanism of how we're going to take it out, please?

Okay. So we don't need any signatures. It's a standard procedure. What -- as I explained to you, Tanya, a while back, there was this confusion between the 2018 code, which we're not legally required to follow. We developed and invested against the 2002 code. But at the same time, as you know, we're not a company that sort of sticks the post up as a last man standing at the top of the mountain. We -- the first step of the payment was at end of the third quarter last year, we paid out a $30 million dividend to just practice the process. And then another $170 million at the end of the year, again, as part of the process because there's a lot of money there, and it makes people anxious. And the next one is we've agreed to pay it out originally, it was 90 days to just manage the banking system and give it a chance to manage that amount of money leaving the DRC. We've now settled on $300 million, $300 million and then $400 million and we'll do it in sort of 1- to 3-week slots. That's the plan. I would also point out, just so everyone understands this, we've never said that we take it out. I've always been very clear and it's never been a question with the government that it wasn't our money and that anyone was trying to keep it there. We've had to go through a whole lot of processes, and it's only recently that we have a fully aligned cabinet that's aligned with the parliament to be able to address some of the requirements. We -- the other one is that 40% of all our revenues stay offshore. So when Kibali every time it sells gold, we keep…

Okay. So when I look at your financials at the end of March, so end Q1, all of that $1 billion or $500 million year share will all have been removed out, so…

So probably $600 million of the $1 billion, it could be. But right now, if you look at every 2 weeks, there is a charge that might be just at the beginning of the last tranche because originally, it was 90 days. But certainly, the next -- this quarter, we should have the first 2 tranches of $300 million. So $600 million, that's $300 million. But I think there's a real motivation for the government to get this thing settled because, Tanya, all the time the money sits in our bank account and DRC, it attracts an 8% interest. So there's a big motivation to get this thing settled.

Okay. So $600 million in Q1 and the remaining $400 million on 100% basis already Q2?

And we might surprise you.

That would be good, yes. And then just maybe still in the DRC, we did notice an export penalty claim. Can you just let us know what that's about?

Yes, that's a normal course of business. We have -- we have sometimes a little overenthusiastic customs people in the annual audits. And in fact, most of those claims are supported by document -- documented approvals in how we manage our duties against, for instance, some of the explosive materials that we import also steel bars just as an example, where it has been interpreted as something else. And it's a normal course of process. We will engage, which we have -- We've got all the comfort letters and the decrees that we need to deal with this challenge. And as we've stated in the MD&A, we don't believe that it's something that we should be providing for.

Okay. And just my last question, if I could, just on your copper strategy. Just wanted to understand a little bit how Reko Diq fits into that strategy and just where we are on this asset?

So right now, the asset that we have is the arbitration award of which we share with Antofagasta and ourselves back. We are working and have been in its general knowledge in the spirit of Barrick philosophy of how we can convert that into something that's more meaningful. And that's something that doesn't end up with the Pakistan government having to write out a big check without any benefits. And Reko Diq is an opportunity that we've been working on whereby everyone will benefit. Our shareholders, of course, and same with the Balochistan government and the Pakistan government. And that's really where I would want to stop it because there's still a lot of work and water to flow under the bridge, but that's the tactic. And as I said, and I think I told Greg at this conference that it's a real asset. And we would like as miners to convert that into our mining asset. It's one of the better ones around. Otherwise, we end up in conflict and that's not a good thing to do with your host country or potential host country.

Okay. So is it fair to say that this is a ways out in terms of fitting into your 10-year pipeline...

It would be fantastic in our 10-year pipeline. It's a real deal.

But it's not in our 10-year pipeline.

But it's not in the -- sorry, it's not in our 10-year pipeline right now.

I understand that. But in terms of resolving everything and then probably having a feasibility study and other stuff in country, would you be able to even fit it into your 10-year pipeline?

Sure. Absolutely.

Our next question is from Mike Parkin with National Bank Financial.

Congrats on the good quarter. Just a question with respect to the performance dividend. Does that indicate kind of a comfort level with carrying debt on the balance sheet? Or are you agnostic to where the debt is given that, that performance dividend is linked to the net cash position?

So I think you've just answered your own question, Mike. Net cash means there's no net debt. And so the way it's designed is that if we have -- because what we've done initially is our debt to pay it all up is expensive. Hopefully, it gets cheaper and cheaper with the growing interest rates. But we've offset it. We've got cash balancing the debt. And what we've said is anything above 0. So from 0 to $500 million net cash payout of $0.05 dividend and then $500 million to $1 billion and $1 billion to [$1.500 billion]. And so that's -- and what it does is it's -- it really is -- it's a non-negotiable process because if we're investing heavily in a big project, for example, and we drive -- we increased the net debt to fund that, then we are investing our shareholders' money into that project. And given our return criteria, we think most -- in fact, more than most of our shareholders would support that. If we don't and we build cash on the balance sheet, we make sure that we don't create a lazy balance sheet and that on a formulaic basis money goes back to shareholders.

Our next question is from Brian MacArthur with Raymond James.

I just wanted to go back to the self-correcting mechanism on the dividend, like and you're just coming from the debt side, but what about the working capital side, I mean, we get variability? If you really built up, you stuck to that working capital down, you get a lot of cash, going to pay it out and then the next quarter rebalance it. Is that what that was to take mean? Or is there some mechanism where you just kind of smooth it over time because a lot of investors like a more smooth dividend and things jumping up and down?

No, I think over the year, as Graham says, it is self-balancing. I don't -- I think it worked really well in Randgold, this sort of approach. It's slightly more sophisticated because it's a much bigger company. But I think you'll see that it will work out just fine.

Well, certainly, over time, you'll build it up anyway, so I get there's less risk about happening. Second question, just, Mark, the other thing I think is quite interesting that doesn't get talked about a lot is ability. So just on this Golden Sunlight deal, you effectively do reclamation, which is very, very good. You get a source of product, which I assume provides lower cost in Nevada, which is a win. But there's also a reversal in the financials. Also levering money from bonds and stuff by doing all this as well, so it's actually a three-pronged win yet?

Yes. So when we started, when we started 3 years ago, the bond was $150 million. It's now $90 million. And it's going down and it will eventually end up at 0. So that's the plan. And just as a broader strategy, inherited, we've got a number of closure sites, which actually sits at the most in North America under Christine. And when I sat down with the team back in 2019, what I challenged the team to do is to engineer. These sites were being maintained and the can kicked down the road and was costing us hundreds of millions of dollars a year just to keep them compliant. And so what we challenged the team with is let's engineer them to closure, not on 100 years of water treatment closure, but full closure. So get the best engineers, focus on rehabilitating the sites, making sure that we can sustainably manage the -- for instance, the water balances, and the team has done an excellent job already. And already, we've more than half that cost. Patrick Malone, are you on the call? Great. Grant, you might want to comment. So we've driven that. And of course, with the higher gold price, we've disposed of some of those sites because they have resources and then they don't meet Barrick's criteria, but they certainly meet other mining minus criteria. And so we've really cleaned up that portfolio and continue to do so. And what it's done as well is it's growing Barrick's skills and technology and managing closure. And that's a real asset to have in the modern world is to deliver -- is to bring another skill when we go mining, and that is that we manage. And I think -- and Grant reinforce this. One of the most neglected parts of ESG is not only the Spat social side, but also the biodiversity and water. And it's a big issue for Barrick in our closure philosophy. Grant, do you want to add to that?

Yes. I think you're right, Mark. In terms of the water aspects, that really was where we focused shortly after the merger because the strategy prior to that was just to treat water in perpetuity. So the liabilities were massive in terms of just water treatment. So that really has been our focus. I mean one of the key drivers for Golden Sunlight was removing that TSF which we needed to treat the seepage water from. And that, again, is going to be in perpetuity. So we've completely removed that liability. And the same for a number of the other sites that we've -- that we started looking at. We've removed that liability. So -- and then to the biodiversity point and Golden Sunlight is a classic example of this is we're being -- we are able to restore that land back to its previous condition. And we've also purchased adjacent land, which we are now making available to the community as a conservation area. So really, it's come full circle on a lot of these closure sites. And at the same time, as you mentioned, reducing those liabilities significantly.

Great. Thanks, not an elegant solution. Just a final question, a quick one. Just as Long Canyon 2 in your 10-year plan?

Yes. But there's a big gap and it sort of winds down. It's -- the debate in the team is, is it really a Barrick level asset? And we're actually looking at -- in conversation with our partners at possibly realizing that asset in the short term. So it is but it's a very small contributor.

Yes. So the -- for the next few years, we're obviously focused on the permitting and then it only kicks back in, in 2026 in terms of fresh rock. But yes, as Mark says, it's out for the -- to decide whether we keep it or not.

Right. Would there be capital in '24 and '25?

No, at this stage.

There are no further questions registered at this time. I would like to turn the conference back over to Mark Bristow for any closing remarks. .

Right. Well, this has been a marathon session. And hopefully, you would have recognized it was in my presentation this time, it was all the questions. So we're really focused on getting this message out. There's a lot of detail in our MD&A. We thank you for your questions. And again, if there are any further questions, as you know, we are always available to answer your questions. So again, thank you for affording us all this time, and we'll see you soon, probably down in Florida, hopefully. So thanks again.