news-details

Barrick Earns $35 Million or $0.07 per Share in Third Quarter (Report, Part 2 of 2)

October 27, 2003

TORONTO--(BUSINESS WIRE)--Oct. 27, 2003--Barrick Gold Corporation (NYSE:ABX) (TSX:ABX) (LSE:ABX) (PARIS:ABX) (Swiss:ABX):

Part 2 of 2

Consolidated Statements of Shareholders'
Equity and Comprehensive Income

CONSOLIDATED STATEMENT OF SHAREHOLDERS' EQUITY
(in millions of United States dollars, US GAAP basis) (Unaudited)
                                                                 2003
---------------------------------------------------------------------
Common shares (number in millions)
At January 1                                                      542
 Issued for cash/on exercise of stock options                       1
 Repurchased for cash (note 9A)                                   (9)
---------------------------------------------------------------------
At Sept. 30                                                       534
---------------------------------------------------------------------
Common shares (amount in millions)
At January 1                                                   $4,148
 Issued for cash/on exercise of stock options                      16
 Repurchased for cash (note 9A)                                  (67)
---------------------------------------------------------------------
At Sept. 30                                                    $4,097
---------------------------------------------------------------------
Deficit
At January 1                                                   $(689)
Net income                                                        123
Dividends                                                        (60)
Repurchase of common shares(1)                                   (87)
---------------------------------------------------------------------
At Sept. 30                                                    $(713)
---------------------------------------------------------------------
Accumulated other comprehensive loss (note 7)                   $(12)
---------------------------------------------------------------------
Total shareholders' equity at Sept. 30                         $3,372
---------------------------------------------------------------------
(1) Represents the excess of cash paid over the average book value
    repurchased as part of the share buyback plan.


CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME
(in millions of United       Three months ended     Nine months ended
 States dollars, US GAAP basis)    Sept. 30,             Sept. 30,
---------------------------------------------------------------------
(Unaudited)                     2003       2002        2003      2002
---------------------------------------------------------------------
Net income                       $35        $34        $123      $139
Foreign currency
 translation adjustments
 (note 7)                        (4)       (11)         (5)      (23)
Transfers of realized
 gains on derivative
 instruments to earnings
 (note 7)                       (19)        (3)        (44)      (13)
Hedge ineffectiveness
 transferred to earnings
 (note 7)                        (3)          -         (7)         -
Change in gain
 accumulated in OCI for
 cash flow hedges (note 7)         2       (12)         149        11
Transfers of realized
 losses on
 available-for-sale
 securities to earnings
 (note 7)                          -          -           7         -
Unrealized gains (losses)
 on available-for-sale
 securities (note 7)              10        (1)          13       (4)

---------------------------------------------------------------------
Comprehensive income             $21         $7        $236      $110
---------------------------------------------------------------------

The accompanying notes are an integral part of these unaudited
interim consolidated financial statements

Notes to Unaudited Interim Consolidated Financial Statements
(US GAAP)

Tabular dollar amounts in millions of United States dollars, unless otherwise indicated, US GAAP basis. References to C$ and A$ are to Canadian and Australian dollars, respectively.

1 BASIS OF PREPARATION

The United States dollar is the principal currency of our operations. We prepare and file our primary consolidated financial statements in United States dollars and under United States generally accepted accounting principles ("US GAAP"). The accompanying unaudited interim consolidated financial statements have been prepared in accordance with US GAAP for the preparation of interim financial information. Accordingly, they do not include all of the information and disclosures required by US GAAP for annual consolidated financial statements. Except as disclosed in note 2, the accounting policies used in the preparation of the accompanying unaudited interim consolidated financial statements are the same as those described in our audited consolidated financial statements and the notes thereto for the three years ended December 31, 2002.

In the opinion of management, all adjustments considered necessary for fair presentation of results for the periods presented have been reflected in these financial statements. Operating results for the period ended September 30, 2003 are not necessarily indicative of the results that may be expected for the full year ending December 31, 2003. These unaudited interim consolidated financial statements should be read in conjunction with the audited annual consolidated financial statements and the notes thereto for the three years ended December 31, 2002.

The preparation of financial statements under US GAAP requires us to make estimates and assumptions that affect:

    --  the reported amounts of assets and liabilities;

    --  disclosures of contingent assets and liabilities; and

    --  revenues and expenses recorded in each reporting period.

The most significant estimates and assumptions that affect our financial position and results of operations are those that use estimates of proven and probable gold reserves, and/or assumptions of future gold prices. Such estimates and assumptions affect:

    --  the value of inventories (which are stated at the lower of
        average cost and net realizable value);

    --  decisions as to when exploration and mine development costs
        should be capitalized or expensed;

    --  whether property, plant and equipment and capitalized mining
        costs may be impaired;

    --  our ability to realize income tax benefits recorded as
        deferred income tax assets; and

    --  the rate at which we charge amortization to earnings.

    We also estimate:

    --  costs associated with reclamation and closure of mining
        properties;

    --  remediation costs for inactive properties;

    --  the timing and amounts of forecasted future expenditures that
        represent the hedged items underlying hedging relationships
        for our cash flow hedge contracts;

    --  the fair values of derivative instruments; and

    --  the likelihood and amounts associated with contingencies.

We regularly review the estimates and assumptions that affect our financial statements; however, what actually happens could differ from those estimates and assumptions.

    2 ACCOUNTING CHANGES

    A FAS 143, Accounting for asset retirement obligations

On January 1, 2003, we adopted FAS 143 and changed our accounting policy for recording obligations relating to the retirement of long-lived assets. FAS 143 applies to legal obligations associated with the retirement of long-lived assets that result from the acquisition, construction, development and/or the normal operation of a long-lived asset. Under FAS 143 we record the fair value of a liability for an asset retirement obligation in the period in which it is incurred. When the liability is initially recorded, we capitalize the cost by increasing the carrying amount of the related long-lived asset. Over time, the liability is increased to reflect an interest element (accretion expense) considered in its initial measurement at fair value, and the capitalized cost is amortized over the useful life of the related asset. Upon settlement of the liability, we will record a gain or loss if the actual cost incurred is different than the liability recorded. On adoption of FAS 143 we recorded on our balance sheet an increase in property, plant and equipment by $39 million; an increase in other long-term obligations by $32 million; and an increase in deferred income tax liabilities by $3 million. In the first quarter of 2003, we recorded in our income statement a $4 million credit for the cumulative effect of this accounting change.

Following the adoption of FAS 143, the total amount of recognized liabilities for asset retirement obligations was $334 million. These liabilities mainly relate to obligations at our active and inactive mines to perform reclamation and remediation activities to meet existing environmental laws and regulations that govern our mining properties.

The comparative amount of these liabilities would have been $353 million at December 31, 2001, using the principles of FAS 143, and using current information, assumptions and interest rates.

For the three-month period ended September 30, 2003, the effect on earnings of adopting FAS 143 was a decrease in income before the cumulative effect of accounting changes by $5 million ($0.01 per share), and for the nine-month period ended September 30, 2003 the effect was a decrease in income before the cumulative effect of accounting changes by $13 million ($0.02 per share).

For the three-month period ended September 30, 2002, the effect of adopting FAS 143 would have been a decrease in income before the cumulative effect of accounting changes by $1 million ($nil per share), and for the nine-month period ended September 30, 2002, the effect would have been a decrease in income before the cumulative effect of accounting changes by $2 million ($nil per share).

B Amortization of underground development costs

Effective January 1, 2003, we changed our accounting policy for amortization of underground mine development costs to exclude estimates of future underground development costs. Future underground development costs, which are significant, are necessary to develop our underground ore bodies, expected to be mined in some cases over the next 25 years.

Previously, we amortized the total of historical capitalized costs and estimated future costs using the units of production method over total proven and probable reserves at our underground mining operations. This accounting change was made to better match amortization with ounces of gold sold and to remove the inherent uncertainty in estimating future development costs from amortization calculations.

Under our revised accounting policy, costs incurred to access specific ore blocks or areas, and that only provide benefit over the life of that area, are amortized over the proven and probable reserves within the specific ore block or area. Infrastructure and other common costs which have a useful life over the entire mine life continue to be amortized over total proven and probable reserves of the mine.

The cumulative effect of this change at January 1, 2003, was to decrease property, plant and equipment by $19 million, and increase deferred income tax liabilities by $2 million. In the first quarter of 2003 we recorded in our income statement a $21 million charge for the cumulative effect of this change.

For the three-month period ended September 30, 2003, the effect of adopting this accounting change was a decrease in income before the cumulative effect of accounting changes by $0.04 million ($nil per share), and for the nine-month period ended September 30, 2003, the effect was a decrease in income before the cumulative effect of accounting changes by $0.12 million ($nil per share).

If the comparative income statements had been adjusted for the retroactive application of this change in amortization policy, there would have been no effect on net income for the three-month period ended September 30, 2002, or nine-month period ended September 30, 2002.

    C Changes in estimates

    Pension costs

In 2003, we reduced the assumed rate of return on pension plan assets from 8.5% to 7%. The effect of this change in 2003 will be to increase pension cost expense by $2 million for the full year.

Proven and probable reserves

For the nine-month period ended September 30, 2003, we expensed development costs totaling $17 million at our Veladero Project in Argentina because in accordance with our accounting policy for these costs, we do not capitalize costs incurred until after proven and probable reserves, as defined by United States reporting standards, have been found. Effective October 1, 2003, we determined that the project met the definition of reserves for United States reporting purposes. Following this determination we will begin capitalizing development costs at the Veladero project prospectively for future periods.

3 OPERATING COSTS

---------------------------------------------------------------------
                               Three months ended   Nine months ended
                                   September 30,       September 30,
                                   2003      2002      2003      2002
---------------------------------------------------------------------
Cost of goods sold               $  286    $  267    $  818    $  820
By-product revenues                (33)      (27)      (86)      (89)
Royalty expenses                     14         9        36        26
Production taxes                      4         1        12         3
Reclamation and other closure
 costs (note 2A)                      -         9         -        27
Accretion expense on
 reclamation/closure obligations
 and other reclamation/closure
 costs (note 2A)                     19         -        44         -
---------------------------------------------------------------------
                                 $  290    $  259    $  824    $  787
---------------------------------------------------------------------

Amortization of capitalized mining costs

We charge most mine operating costs to inventory as incurred. However, we defer and amortize certain mining costs associated with open-pit deposits that have diverse ore grades and waste-to-ore ton ratios over the mine life. These mining costs arise from the removal of waste rock at our open-pit mines, and we commonly refer to them as "deferred stripping costs". We record in cost of goods sold amortization of amounts deferred based on a "stripping ratio" using the units-of-production method. This accounting method results in the smoothing of these costs over the life of mine, rather than expensing them as incurred. Some mining companies expense these costs as incurred, which may result in the reporting of greater volatility in period-to-period results of operations. The application of our deferred stripping accounting policy in the three months ended September 30, 2003 resulted in an increase in operating costs by $18 million compared to actual costs incurred (three months ended September 30, 2002 - $9 million increase), and for the nine months ended September 30, 2003, the application resulted in an increase in operating costs by $34 million compared to actual costs incurred (nine months ended September 30, 2002 - $11 million increase).

Capitalized mining costs are an asset that represents the excess of costs capitalized over the related amortization recorded, although it is possible that a liability could arise if cumulative amortization exceeds costs capitalized. The carrying amount of capitalized mining costs is included with related mining property, plant and equipment for impairment testing purposes.

Average stripping ratios (1)
---------------------------------------------------------------------
                               Three months ended   Nine months ended
                                   September 30,       September 30,
                                   2003      2002      2003      2002
---------------------------------------------------------------------
Betze-Post (Goldstrike)           112:1     112:1     112:1     112:1
Pierina                            48:1      48:1      48:1      48:1
---------------------------------------------------------------------

(1) The stripping ratio is calculated as the ratio of total tons (ore
and waste) of material to be moved compared to total recoverable
ounces in proven and probable gold reserves.

The average remaining life of the above-mentioned open-pit mine operations for which we capitalize mining costs is 9 years. The full amount of stripping costs incurred will be expensed by the end of the mine lives.

4 INTEREST AND OTHER INCOME

---------------------------------------------------------------------
                               Three months ended   Nine months ended
                                   September 30,       September 30,
                                   2003      2002      2003      2002
---------------------------------------------------------------------
Interest income                   $   9      $  4     $  25     $  18
Gains (losses) on sale of
 property, plant and equipment       16         -        32         5
Foreign currency translation
 gains (losses)                     (1)         5       (6)         3
Losses on short-term investments      -         -       (7)       (4)
Other items                           -         3       (5)         6
---------------------------------------------------------------------
                                  $  24     $  12     $  39     $  28
---------------------------------------------------------------------

5  INCOME TAXES

Income tax recovery (expense)
---------------------------------------------------------------------
                               Three months ended   Nine months ended
                                   September 30,       September 30,
                                   2003      2002      2003      2002
---------------------------------------------------------------------
Current                        $   (42)    $  (5)   $  (74)   $  (15)
Deferred                             20         3        65         9
---------------------------------------------------------------------
                               $   (22)    $  (2)   $   (9)   $   (6)
---------------------------------------------------------------------

Following a corporate reorganization of certain North American subsidiaries in second quarter 2003, we released valuation allowances totaling $21 million previously recorded against certain deferred income tax assets in entities that did not have any current sources of income. The tax benefits from these previously unrecognized tax assets are now expected to be realized, and this benefit was recorded as a component of the $65 million deferred income tax credit for the nine months ended September 30, 2003.

Excluding the $21 million valuation allowance released in second quarter 2003, our estimated underlying effective tax rate for the nine months ended September 30, 2003 was 20%. The two major reasons why this rate differs from the Canadian federal statutory rate of 38% include: non-hedge derivative gains in a low tax-rate jurisdiction caused our effective tax rate to decrease by 6%; and the benefits of previously unrecognized tax loss carryforwards in various foreign subsidiaries which were utilized to offset higher levels of taxable income due to the higher gold price environment which caused our effective tax rate to decrease by 12%.

6 EARNINGS PER SHARE

Net income per share was calculated using the weighted average number of common shares outstanding for the three-month period ended September 30, 2003, which amounted to 536 million shares (2002 - 540 million shares), and for the nine-month period ended September 30, 2003 amounted to 540 million shares (2002 - 540 million shares).

Diluted net income per share reflects the dilutive effect of the exercise of the common share purchase options outstanding as at the end of the period. The number of shares for the diluted net income per share calculation for the three- month period ended September 30, 2003 amounted to 538 million shares (2002 - 541 million shares) and for the nine-month period ended September 30, 2003 amounted to 540 million shares (2002 - 541 million shares).

7 COMPREHENSIVE INCOME

Comprehensive income consists of net income and other gains and losses that are excluded from net income. Other gains and losses consist mainly of gains and losses on derivative instruments accounted for as cash flow hedges; unrealized gains and losses on investments; and foreign currency translation adjustments.

Parts of comprehensive income (loss)
---------------------------------------------------------------------
                     Three months ended             Nine months ended
                       September 30,                 September 30,
                    2003           2002           2003           2002
---------------------------------------------------------------------
          Pre-tax    Tax Pre-tax    Tax Pre-tax    Tax Pre-tax    Tax
           amount effect  amount effect  amount effect  amount effect
---------------------------------------------------------------------
Foreign
 currency
 translation
 adjustments $(4)   $  - $  (11)   $  -  $  (5)   $  - $  (23)   $  -
Transfers of
 realized
 gains on cash
 flow hedges
 to earnings
 (note 11F)  (27)      8     (5)      2    (62)     18    (18)      5
Hedge
 ineffectiveness
 transferred
 to earnings
 (note 11F)   (4)      1       -      -    (10)      3       -      -
Change in
 gains
 accumulated
 in OCI for
 cash flow
 hedges
 (note 11F)    11    (9)    (19)      7     230   (81)      18    (7)
Transfers of
 losses on
 available-
 for-sale
 securities
 to earnings    -      -       -      -       7      -       -      -
Unrealized
 gains (losses)
 on available-
 for-sale
 securities    10      -      (1)     -      13      -     (4)      -
---------------------------------------------------------------------
           $ (14)  $   -  $  (36)  $  9  $  173 $ (60) $  (27) $  (2)
---------------------------------------------------------------------


Accumulated other comprehensive income (loss) (OCI)
---------------------------------------------------------------------
                      At September 30, 2003      At December 31, 2002
---------------------------------------------------------------------
                     Pre-tax     Tax         Pre-tax      Tax
                      amount  effect  Total   amount   effect   Total
---------------------------------------------------------------------
Foreign currency
 translation
 adjustments        $  (149)    $  - $(149) $  (144)     $  - $ (144)
Accumulated gains on
 cash flow hedges
 (note 11F)              207    (77)    130       49     (17)      32
Additional minimum
 pension liability       (7)       -    (7)      (7)        -     (7)
Unrealized gains
 (losses) on
 available-for-sale
 securities               14       -     14      (6)        -     (6)
---------------------------------------------------------------------
                       $  65 $  (77)  $(12) $  (108)  $  (17) $ (125)
---------------------------------------------------------------------

8   INVENTORIES AND OTHER CURRENT ASSETS

---------------------------------------------------------------------
                             At September 30, 2003   At Dec. 31, 2002
---------------------------------------------------------------------
Inventories
Gold in process and ore in stockpiles       $  101             $  100
Mine operating supplies                         61                 59
---------------------------------------------------------------------
                                            $  162             $  159
---------------------------------------------------------------------
Other current assets
Derivative assets (note 11)                     35                 37
Prepaid expenses                                23                 10
---------------------------------------------------------------------
                                             $  58              $  47
---------------------------------------------------------------------

Gold in process and ore in stockpiles excludes $63 million (December 31, 2002 - $61 million) of stockpiled ore, which is not expected to be processed in the following 12 months. This amount is included in other assets.

    9 CAPITAL STOCK

    A Share repurchase program

During the three-month period ended September 30, 2003, we repurchased 5.27 million common shares at an average cost of $17.30 per share. For the nine-month period ended September 30, 2003, we repurchased 8.75 million common shares at an average cost of $17.56 per share.

B Barrick Gold Inc. ("BGI") exchangeable shares

In connection with a 1998 acquisition, BGI, formerly Homestake Canada Inc., issued 11.1 million BGI exchangeable shares. Each BGI exchangeable share is exchangeable for 0.53 of a Barrick common share at any time at the option of the holder and has essentially the same voting, dividend (payable in Canadian dollars), and other rights as 0.53 of a Barrick common share. BGI is a subsidiary that holds our interest in the Hemlo and Eskay Creek Mines.

At September 30, 2003, 1.6 million BGI exchangeable shares were outstanding, which are equivalent to 0.8 million Barrick common shares. The equivalent common share amounts are reflected in the number of common shares outstanding.

At any time on or after December 31, 2008, or when fewer than 1.4 million BGI exchangeable shares are outstanding, we have the right to require the exchange of each outstanding BGI exchangeable share for 0.53 of a Barrick common share. While there are exchangeable shares outstanding, we are required to present summary consolidated financial information relating to BGI for holders of exchangeable shares.

Summarized financial information for BGI
---------------------------------------------------------------------
                               Three months ended   Nine months ended
                                   September 30,       September 30,
                                   2003      2002      2003      2002
---------------------------------------------------------------------
Total revenues and other income   $  60    $   38    $  165    $  141
Less: costs and expenses             59        36       175       138
---------------------------------------------------------------------
Income (loss) before taxes:       $   1    $    2    $ (10)    $    3
---------------------------------------------------------------------
Net income (loss)                 $   1    $  (2)    $ (11)    $  (7)
---------------------------------------------------------------------

---------------------------------------------------------------------
                          At September 30, 2003  At December 31, 2002
---------------------------------------------------------------------
Current assets                           $  137                 $  91
Non-current assets                          258                   236
---------------------------------------------------------------------
Total assets                                395                   327
---------------------------------------------------------------------
Current liabilities                          88                    75
Notes payable                               525                   407
Other long-term liabilities                  14                    18
Deferred income taxes                        94                   122
Shareholders' equity                      (326)                 (295)
---------------------------------------------------------------------
Total liabilities and shareholders'
 equity                                  $  395                $  327
---------------------------------------------------------------------

10  EMPLOYEE STOCK-BASED COMPENSATION

Common stock options

Stock option activity (shares in millions)
---------------------------------------------------------------------
                            Common    Weighted    Common     Weighted
                            shares     average    shares      average
                          (number)  price (C$)  (number)  price (US$)
---------------------------------------------------------------------
At December 31, 2002          18.9                   3.1
  Granted                      1.0    $  25.10         -            -
  Exercised                  (0.3)    $  24.00     (0.4)    $   11.39
  Canceled or expired        (0.7)    $  28.30     (0.1)    $   23.28
---------------------------------------------------------------------
At September 30, 2003         18.9                   2.6
---------------------------------------------------------------------

Under Accounting Principles Board Opinion No. 25 (Accounting for Stock Issued to Employees) (APB 25), we recognize compensation cost for stock options in earnings based on the excess, if any, of the quoted market price of the stock at the grant date of the award over the option exercise price. Generally, the exercise price for stock options granted to employees equals the fair market value of our common stock at the date of grant, resulting in no compensation cost.

FASB Statement No. 123 (Accounting for Stock-Based Compensation) ( FAS 123) encourages, but does not require, companies to record compensation cost for stock-based employee compensation plans based on the fair value of options granted. We have elected to continue to account for stock-based compensation using the intrinsic value method prescribed in APB 25 and its related interpretations, and to provide disclosures of the pro forma effects of adoption had we recorded compensation expense under the fair value method.

Stock option expense (per share amounts in dollars)
---------------------------------------------------------------------
                               Three months ended   Nine months ended
                                   September 30,       September 30,
                                   2003      2002      2003      2002
---------------------------------------------------------------------
Pro forma effects
Net income, as reported           $  35     $  34    $  123   $   139
Stock-option expense                (6)       (5)      (18)      (15)
---------------------------------------------------------------------
Pro forma net income              $  29     $  29    $  105   $   124
---------------------------------------------------------------------
Net income per share
As reported (1)                 $  0.07   $  0.06   $  0.23   $  0.26
Pro forma (1)                   $  0.05   $  0.05   $  0.19   $  0.23
---------------------------------------------------------------------
 (1) basic and diluted
    11 DERIVATIVE INSTRUMENTS

    A Derivative instruments

We use derivative financial instruments to reduce or eliminate the inherent risks of certain identifiable transactions and balances that occur in the normal course of our business. The inherent risks in these transactions and balances arise from changes in: commodity prices (gold and silver), interest rates and foreign currency exchange rates. The purpose of our derivative program is to ensure that disadvantageous changes in the values or cash flows from these transactions and balances are offset by changes in the values of the derivatives. We do not hold derivatives for the purpose of speculation; our derivative program is designed to enable us to plan our operations on the basis of secure assumptions that will not be jeopardized by future movements of gold and silver prices, interest rates and currency exchange rates. For a more detailed description of the types of derivative instruments we use, and our accounting policy for derivative instruments, refer to note 23 to our audited consolidated financial statements for the three years ended December 31, 2002.

    B Gold and silver hedge contracts

    Forward gold sales contracts

We have entered into forward gold sales contracts with various counterparties that fix selling prices at interim dates prior to the final delivery date for 16.1 million ounces of future gold production, and that have fixed price adjustment mechanisms based on the market gold price in the case of rescheduling of delivery dates. These contracts act as an economic hedge against possible price fluctuations in gold. The contracts have final delivery dates primarily over the next 10 to 15 years, but we have the right to accelerate the delivery date at any time during this period. At the time a price is set for a rescheduled interim date, the original contract price is adjusted based on the difference between the prevailing forward gold market price and the spot price of gold.

For the large majority of contracts, future prices are presently fixed through 2006. The contract prices are determined based on gold forward market prices. Forward gold market prices are principally influenced by the spot price of gold, gold lease rates and U.S. dollar interest rates. The actual realized price will depend on the timing of the actual future delivery date and the actual amount of the premium of the forward price of gold over the spot price of gold on the dates that selling prices are set.

Gold lease rate contracts

In addition to the above-noted forward gold sales contracts, we also have gold lease rate swaps (where Barrick receives a fixed gold lease rate, and pays a floating gold lease rate) on 3.7 million ounces of gold spread from 2004 to 2013, for gold sales contracts with expected delivery dates beyond 2006.

We use gold lease rate swap contracts to manage our gold lease rate exposure. These economic hedges do not qualify for hedge accounting under FAS 133 and therefore the economic impact flows through our earnings each quarter as part of non-hedge derivative gains (losses).

Major customers

The largest single counterparty as of September 30, 2003 made up 11% of the ounces of outstanding forward gold sales contracts.

Forward silver sales contracts

Forward silver sales contracts have similar delivery terms and pricing mechanisms as forward gold sales contracts. At September 30, 2003, we had commitments to deliver 32.5 million ounces of silver over periods of up to 10 to 15 years. A group of these contracts totaling 20.5 million ounces of silver are accounted for as normal sales contracts.

A separate group of contracts totaling 12 million ounces are accounted for as derivatives under FAS 133. During the second quarter 2003, hedge accounting treatment for these contracts was discontinued prospectively. Despite the fact that these contracts act as effective economic hedges, we determined that they no longer meet the strict FAS 133 hedge criteria. The effect of reclassifying accumulated gains from OCI to the income statement was a gain of $0.2 million.

C Other derivative instruments outstanding as at September 30, 2003

---------------------------------------------------------------------
Maturity                   2003  2004  2005  2006  2007  2008+  Total
---------------------------------------------------------------------
Written silver call options
  Ounces (thousands)          - 3,000 2,000     -     -      -  5,000
  Average exercise price
   per ounce               $  - $5.40 $5.00     -     -      - $ 5.24
---------------------------------------------------------------------
Interest rate contracts
Receive fixed - swaps
  Notional amount (millions)  - $  50 $   - $ 100 $ 625 $  375 $1,150
  Fixed rate (%)              -  3.6%     -  3.0%  3.4%   3.8%   3.5%
Pay fixed - swaps
  Notional amount (millions)  -     -     -     -     - $  334 $  334
  Fixed rate (%)              -     -     -     -     -   5.6%   5.6%
---------------------------------------------------------------------
Net notional position         - $  50 $   - $ 100 $ 625 $   41 $  816
---------------------------------------------------------------------
Foreign currency contracts
Canadian Dollar Forwards
  C$ (millions)           $  76 $ 398 $ 247 $  38 $  96 $   22 $  877
  Average Price (US cents) 0.66  0.67  0.65  0.66  0.67   0.68   0.66
Canadian Dollar Min-Max
 Contracts
  C$ (millions)           $  18     -     -     -     -      - $   18
  Average Cap Price
   (US cents)              0.69     -     -     -     -      -   0.69
  Average Floor Price
   (US cents)              0.67     -     -     -     -      -   0.67
Australian Dollar Forwards
  A$ (millions)            $ 14 $ 505 $ 307 $ 193 $ 139  $  19 $1,177
  Average Price (US cents) 0.54  0.55  0.54  0.55  0.58   0.53   0.55
Australian Dollar Min-Max
 Contracts
  A$ (millions)           $ 118 $  20 $  10 $  10     -      -  $ 158
  Average Cap Price
   (US cents)              0.55  0.54  0.52  0.52     -      -   0.54
  Average Floor Price
   (US cents)              0.54  0.52  0.51  0.51     -      -   0.53
Fuel contracts
  Barrels WTI (thousands)    60   180     -     -     -      -    240
  Cap                     $  30 $  30     -     -     -      -  $  30
  Floor                   $   - $  19     -     -     -      -  $  19
---------------------------------------------------------------------

Our written silver call options, interest rate and foreign currency contracts are recorded at fair value on our balance sheet, with changes in fair value recorded in earnings as they occur, with the following exceptions:

    --  we have elected cash flow hedge accounting treatment for
        Canadian dollar foreign currency contracts with a total
        notional amount of C$893 million, and Australian dollar
        foreign currency contracts with a total notional amount of
        A$1,259 million.

    --  we have elected for receive-fixed interest rate swaps with a
        total notional amount of $800 million to be accounted for as
        cash flow hedges of expected future interest receipts arising
        on our cash and short-term investments; and we have elected
        for receive-fixed interest rate swaps with a total notional
        amount of $350 million to be accounted for as a fair value
        hedge of our fixed-rate debentures.

    --  we have elected for an amortizing pay-fixed interest rate swap
        with a total notional amount of $184 million as at September
        30, 2003 to be accounted for as a cash flow hedge of future
        interest payments relating to the Bulyanhulu project
        financing.

D Unrealized fair value of derivative instruments (excluding normal sales contracts)

---------------------------------------------------------------------
                               Three months ended   Nine months ended
                                   September 30,       September 30,
                                   2003      2002      2003      2002
---------------------------------------------------------------------
Beginning of period            $    262   $    25    $   29  $   (16)
Derivative instruments
 entered into or settled           (25)         8      (55)       (2)
Change in fair value of
 derivative instruments:
  Non-hedge derivatives            (25)       (3)        15         8
  Cash flow hedges                   11      (22)       230        18
  Fair value hedges                 (3)         -         1         -
---------------------------------------------------------------------
End of period                  $    220   $     8    $  220   $     8
---------------------------------------------------------------------

The fair values of recorded derivative assets and liabilities reflect the netting of the fair values of individual derivative instruments, and amounts due to/from counterparties that arise from derivative instruments, when the conditions of FIN No. 39, Offsetting of Amounts Related to Certain Contracts, have been met. Amounts receivable from counterparties that have been offset against derivative liabilities totaled $16 million at September 30, 2003.

E Non-hedge derivative gains (losses)

---------------------------------------------------------------------
                               Three months ended   Nine months ended
                                   September 30,       September 30,
                                   2003      2002      2003      2002
---------------------------------------------------------------------
Commodity contracts            $    (6)   $    13    $    -    $    1
Currency contracts                  (2)      (11)         4         4
Interest and lease rate contracts  (17)       (5)        11         3
Hedge ineffectiveness recorded
 in earnings                          4         -        10         -
---------------------------------------------------------------------
                               $   (21)   $   (3)   $    25    $    8
---------------------------------------------------------------------

F  Change in gains accumulated in OCI for cash flow hedge contracts

---------------------------------------------------------------------
                                          Foreign  Interest-
                             Commodity   currency       rate
                             contracts  contracts  contracts    Total
---------------------------------------------------------------------
As at December 31 , 2002       $     9   $     26   $     14   $   49
Change in fair value                 3        216         11      230
Hedge gains transferred
 to earnings                      (10) (1)   (41) (2)   (11) (3) (62)
Hedge ineffectiveness
 transferred to earnings             -        (9)        (1)     (10)
---------------------------------------------------------------------
As at September 30, 2003       $     2   $    192   $     13   $  207
---------------------------------------------------------------------
  1. Included under revenues
  2. Included under costs and expenses
  3. Included under interest income

In the next twelve months, we expect to transfer gains of $98 million, excluding the related deferred income tax effects, from OCI to earnings. During the nine months ended September 30, 2003, we determined that certain Australian dollar hedge contracts designated as hedges of forecasted capital expenditures no longer met the qualifying FAS 133 hedge criteria due to changes in the expected timing of the forecasted expenditures. Accumulated gains totaling $9 million were recorded under non-hedge derivative gains for the nine-month period ended September 30, 2003. For the three and nine month periods ended September 30, 2003, the total amount of hedge ineffectiveness, including the gains on capital expenditure hedges, recorded and recognized in non-hedge derivative gains was $4 million and a gain of $9.5 million respectively (2002 - $nil and $nil respectively).

12 CONTINGENCIES

Certain conditions may exist as of the date the consolidated financial statements are issued, which may result in a loss to the Company but which will only be resolved when one or more future events occur or fail to occur. Management and, where appropriate, legal counsel, assess such contingent liabilities, which inherently involves an exercise of judgment.

In assessing loss contingencies related to legal proceedings that are pending against us or unasserted claims that may result in such proceedings, the Company and its legal counsel evaluate the perceived merits of any legal proceedings or unasserted claims as well as the perceived merits of the amount of relief sought or expected to be sought.

If the assessment of a contingency suggests that it is probable that a loss has been incurred and the amount of the liability can be estimated, then the estimated liability is accrued in the consolidated financial statements. If the assessment suggests that a potentially material loss contingency is not probable but is reasonably possible, or is probable but cannot be estimated, then the nature of the contingent loss, together with an estimate of the range of possible loss, if determinable, is disclosed. Loss contingencies considered remote are generally not disclosed unless they involve guarantees, in which case we disclose the nature of the guarantee.

A Environmental

Our mining and exploration activities are subject to various federal, provincial and state laws and regulations governing the protection of the environment. These laws and regulations are continually changing and generally becoming more restrictive. We conduct our operations so as to protect public health and the environment, and we believe that our operations are materially in compliance with all applicable laws and regulations. We have made, and expect to make in the future, expenditures to meet such laws and regulations.

The Comprehensive Environmental Response, Compensation and Liability Act imposes heavy liabilities on persons who discharge hazardous substances. The Environmental Protection Agency publishes a National Priorities List ("NPL") of known or threatened releases of such substances. Homestake's former uranium millsite near Grants, New Mexico is listed on the NPL.

    B Litigation and claims

    Inmet litigation

In October 1997, Barrick Gold Inc. ("BGI"), formerly Homestake Canada Inc., a wholly-owned subsidiary of Barrick, entered into an agreement with Inmet Mining Corporation ("Inmet") to purchase the Troilus mine in Quebec for $110 million plus working capital. In December 1997, BGI terminated the agreement after deciding that, on the basis of due diligence studies, conditions to closing the arrangement would not be satisfied.

On February 23, 1998, Inmet filed suit against BGI in the British Columbia Supreme Court disputing the termination of the agreement and alleging that BGI had breached the agreement. On January 15, 2002, the Supreme Court of British Columbia released its decision in the matter and found in favour of Inmet and against BGI. Specifically, the Court held that Inmet should be awarded equitable damages in the amount of C$88.2 (US $59) million, which was accrued at December 31, 2001. The Court did not award Inmet pre-judgment interest. Inmet requested the Court to re-open the trial to let Inmet make submissions on its claim for pre-judgment interest from the date of the breach by BGI. The request to re-open was denied by the Court on May 17, 2002.

On February 7, 2002, BGI filed a Notice of Appeal of the decision with the British Columbia Court of Appeal. Inmet filed a Cross-Appeal of the decision regarding pre-judgment interest. A letter of credit of about C$95 million was posted on August 20, 2002 by BGI with the British Columbia Court of Appeal, pending a decision on the appeal. The Appeal of BGI and the Cross-Appeal of Inmet was heard during June 2003.

Bre-X Minerals

On April 30, 1998, we were added as a defendant in a class action lawsuit initiated against Bre-X Minerals Ltd., certain of its directors and officers or former directors and officers and others in the United States District Court for the Eastern District of Texas, Texarkana Division. The class action alleges, among other things, that statements made by us in connection with our efforts to secure the right to develop and operate the Busang gold deposit in East Kalimantan, Indonesia were materially false and misleading and omitted to state material facts relating to the preliminary due diligence investigation undertaken by us in late 1996.

On July 13, 1999, the Court dismissed the claims against us and several other defendants on the grounds that the plaintiffs had failed to state a claim under United States securities laws. On August 19, 1999, the plaintiffs filed an amended complaint restating their claims against us and certain other defendants and on June 14, 2000 filed a further amended complaint, the Fourth Amended Complaint.

On March 31, 2001, the Court granted in part and denied in part our Motion to Dismiss the Fourth Amended Complaint. As a result, we remain a defendant in the case. We believe that the remaining claims against us are without merit. We filed our formal answer to the Fourth Amended Complaint on April 27, 2001 denying all relevant allegations of the plaintiffs against us. Discovery in the case has been stayed by the Court pending the Court's decision on whether or not to certify the case as a class action. The amount of potential loss, if any, which we may incur arising out of the plaintiffs' claims is not presently determinable.

On March 31, 2003, the Court denied all of the Plaintiffs' motions to certify the case as a class action. Plaintiffs have not filed an interlocutory appeal of the Court's decision denying class certification to the Fifth Circuit Court of Appeals. On June 2, 2003, the Plaintiff's submitted a proposed Trial and Case Management Plan, suggesting that the Plan would cure the defects in the Plaintiff's motions to certify the class. The Court has taken no action with respect to the proposed Trial and Case Management Plan. The Plaintiffs' case against the Defendants may now proceed in due course, but not on behalf of a class of Plaintiffs but only with respect to the specific claims of the Plaintiffs named in the lawsuit. Having failed to certify the case as a class action, we believe that the likelihood of any of the named Defendants succeeding against Barrick with respect to their claims for securities fraud is remote.

Blanchard complaint

On January 7, 2003, we were served with a Complaint for Injunctive Relief by Blanchard and Company, Inc. ("Blanchard"), and Herbert Davies ("Davies"). The complaint, which is pending in the U. S. District Court for the Eastern District of Louisiana, also names J. P. Morgan Chase & Company ("J.P. Morgan") as a defendant, along with an unspecified number of additional defendants to be named later. The complaint, which has been amended several times, alleges that we and bullion banks with which we entered into spot deferred contracts have manipulated the price of gold, in violation of U.S. antitrust laws and the Louisiana Unfair Trade Practices and Consumer Protection Law. Blanchard alleges that it has been injured as a seller of gold due to reduced interest in gold as an investment. Davies, a customer of Blanchard, alleges injury due to the reduced value of his gold investments. The complaint seeks damages and an injunction terminating certain of our trading agreements with J. P. Morgan and other bullion banks. In September 2003 the Court issued an Order granting in part and denying in part Barrick's motions to dismiss this action. Barrick has requested that the Court reconsider portions of that Order. That request is pending. We intend to defend the action vigorously.

Wagner complaint

On June 12, 2003, a complaint was filed against Barrick and several of its current or former officers in the U.S. District Court for the Southern District of New York. The complaint is on behalf of Barrick shareholders who purchased Barrick shares between February 14, 2002 and September 26, 2002. It alleges that Barrick and the individual defendants violated U.S. securities laws by making false and misleading statements concerning Barrick's projected operating results and earnings in 2002. The complaint seeks an unspecified amount of damages. At least two other complaints, making the same basic allegations against the same defendants, have been filed by other parties on behalf of the same proposed class of Barrick shareholders. In September the cases were consolidated into a single action in the Southern District of New York. The plaintiffs have been ordered to file a Consolidated and/or Amended Complaint by November 4, 2003. Barrick has yet to respond to the consolidated complaint. We intend to defend the action vigorously.

Peruvian tax assessment

On December 27, 2002, one of our Peruvian subsidiaries received an income tax assessment of $41 million, excluding interest and penalties, from the Peruvian tax authority SUNAT. The tax assessment relates to a recently completed tax audit of our Pierina Mine for the 1999-2000 fiscal years. The assessment mainly relates to the revaluation of the Pierina mining concession and associated tax basis. Under the valuation proposed by SUNAT, the tax basis of Pierina assets would change from what we have previously assumed with a resulting increase in current and deferred income taxes. While we believe the tax assessment is incorrect and we will appeal the decision, the full life of mine effect on our current and deferred income tax liabilities of $141 million is recorded at December 31, 2002, as well as other payments of about $21 million due for periods through 2002.

We intend to pursue all available administrative and judicial appeals. If we are successful on appeal and our original asset valuation is confirmed as the appropriate tax basis of assets, we would benefit from a $141 million reduction in tax liabilities recorded at December 31, 2002. The effect of this contingent gain, if any, will be recorded in the period the contingency is resolved.

Under Peruvian law, we are not required to make payment of disputed taxes for prior years pending the outcome of the appeal process, which routinely takes several years.

We have not provided for $51 million of potential interest and penalties assessed in the audit. Even if the tax assessment is upheld, we believe that we will prevail on the interest and penalties part, because the assessment runs counter to applicable law and previous Peruvian tax audits. The potential amount of interest and penalties will increase over time while we contest the tax assessment. A liability for interest and penalties will only be recorded should it become probable that SUNAT's position on interest and penalties will be upheld, or if we exhaust our appeals.

Other

From time to time, we are involved in various claims, legal proceedings and complaints arising in the ordinary course of business. We are also subject to reassessment for income and mining taxes for certain years. We do not believe that adverse decisions in any pending or threatened proceedings related to any potential tax assessments or other matters, or any amount which we may be required to pay by reason thereof, will have a material adverse effect on our financial condition or future results of operations.

13 SEGMENT INFORMATION

We operate in the gold mining industry and our operations are managed on a district basis. The Goldstrike District includes the Betze-Post and Meikle Mines in the United States. Our "other operating mines" segment includes mainly operations which have been, or are being, closed.

Income statement information
---------------------------------------------------------------------
                                                       Segment income
                                                        (loss) before
                           Gold sales Operating costs    income taxes
---------------------------------------------------------------------
Three months ended
 September 30,           2003    2002    2003    2002    2003    2002
---------------------------------------------------------------------
Goldstrike              $ 235   $ 162   $ 145   $ 110    $ 47    $ 14
Pierina                    79      75      18      17      21      18
Bulyanhulu                 23      28      18      18     (4)       1
Kalgoorlie                 46      32      24      21      17       7
Eskay Creek                32      30       1       4      19      14
Hemlo                      28      22      16      14       9       6
Plutonic                   34      30      16      17      15      10
Round Mountain             35      36      16      18      14      12
Other operating
 mines                     37      58      17      31      12      20
---------------------------------------------------------------------
Segment total             549     473     271     250     150     102
Other items outside
 operating segments         -       -      19       9       -       -
---------------------------------------------------------------------
                        $ 549   $ 473   $ 290   $ 259   $ 150   $ 102
---------------------------------------------------------------------


---------------------------------------------------------------------
                                                       Segment income
                                                        (loss) before
                            Gold Sales Operating costs   income taxes
---------------------------------------------------------------------
Nine months ended
 September 30,           2003     2002    2003    2002    2003   2002
---------------------------------------------------------------------
Goldstrike              $ 598    $ 497   $ 390   $ 326    $ 90   $ 59
Pierina                   241      208      55      45      63     52
Bulyanhulu                 86       92      55      57       2      8
Kalgoorlie                114       91      65      59      34     18
Eskay Creek                96       90      17       9      43     47
Hemlo                      71       67      45      47      18     13
Plutonic                   87       77      46      42      35     27
Round Mountain            103      103      49      54      39     33
Other operating
 mines                    103      216      58     121      26     65
---------------------------------------------------------------------
Segment total           1,499    1,441     780     760     350    322
Other items outside
 operating segments         -        -      44      27       -      -
---------------------------------------------------------------------
                      $ 1,499  $ 1,441   $ 824   $ 787   $ 350  $ 322
---------------------------------------------------------------------


Asset information

Amortization
---------------------------------------------------------------------
                                Three months ended  Nine months ended
                                     September 30,      September 30,
                                    2003      2002      2003     2002
---------------------------------------------------------------------
Goldstrike                          $ 43      $ 38     $ 118    $ 112
Pierina                               40        40       123      111
Bulyanhulu                             9         9        29       27
Kalgoorlie                             5         4        15       14
Eskay Creek                           12        12        36       34
Hemlo                                  3         2         8        7
Plutonic                               3         3         6        8
Round Mountain                         5         6        15       16
Other operating mines                  8         7        19       30
---------------------------------------------------------------------
Segment total                        128       121       369      359
Other amortization outside
 operating segments                    6         5        21       16
---------------------------------------------------------------------
                                   $ 134     $ 126     $ 390    $ 375
---------------------------------------------------------------------


Segment capital expenditures
---------------------------------------------------------------------
                               Three months ended   Nine months ended
                                    September 30,       September 30,
                                    2003     2002      2003      2002
---------------------------------------------------------------------
Goldstrike                          $ 12     $ 11      $ 40      $ 35
Plutonic                              15        6        40        14
Bulyanhulu                             8       12        27        44
Kalgoorlie                            10        4        12         7
Veladero                              12        -        19         -
Cowal                                  6        5        16         7
Pierina                                4        2         9         4
Hemlo                                  2        2         7         5
Pascua-Lama                            1        3         7         9
Round Mountain                         3        1         5         7
Eskay Creek                            1        5         4         8
Alto Chicama                           -        -         2         -
Other operating mines                  6        6        25        24
---------------------------------------------------------------------
Segment total                         80       57       213       164
Other capital expenditures
 outside operating segments            1        1         3         2
---------------------------------------------------------------------
                                    $ 81     $ 58     $ 216     $ 166
---------------------------------------------------------------------


Reconciliation of segment income to enterprise net income
---------------------------------------------------------------------
                                Three months ended  Nine months ended
                                     September 30,      September 30,
                                    2003      2002      2003     2002
---------------------------------------------------------------------
Segment total                      $ 150     $ 102     $ 350    $ 322
Non-legal reclamation/closure
 costs/accretion expense/other      (19)         -      (44)        -
Reclamation and other closure
 costs                                 -       (9)         -     (27)
Other amortization outside
 operating segments                  (6)       (5)      (21)     (16)
Exploration and business
 development                        (38)      (30)     (101)     (77)
Administration                      (21)      (16)      (63)     (49)
Interest and other income             24        12        39       28
Interest expense                    (12)      (15)      (36)     (44)
Non-hedge derivative gains
 (losses)                           (21)       (3)        25        8
Income tax expense                  (22)       (2)       (9)      (6)
Cumulative effect of changes
 in accounting principles              -         -      (17)        -
---------------------------------------------------------------------
Net income                          $ 35      $ 34     $ 123    $ 139
---------------------------------------------------------------------

14 COMPONENTS OF OTHER NET OPERATING ACTIVITIES

---------------------------------------------------------------------
                               Three months ended   Nine months ended
                                    September 30,       September 30,
                                    2003     2002      2003      2002
---------------------------------------------------------------------
Non-cash charges (credits):
  Reclamation costs                  $ -      $ 9       $ -      $ 27
  Losses on short-term
   investments                         -        -         7         4
  Gains on sale of property,
   plant and equipment              (16)        -      (32)       (5)
  Cumulative effect of changes
   in accounting principles            -        -        17         -
  Accretion expense                    5        -        13         -
  Non-hedge derivative gains
   (losses)                           21        3      (25)       (8)
Changes in operating assets
 and liabilities:
  Accounts receivable                  -        -         5       (5)
  Inventories                        (2)        8       (3)        49
  Accounts payable                     9     (15)       (6)      (14)
  Current income taxes accrued        42        5        74        15
  Other assets and liabilities       (2)     (14)       (8)      (63)
Payments of merger related
 costs                                 -        -         -      (38)
Payments of accrued
 reclamation and closure costs       (4)     (22)      (20)      (44)
Payments of income taxes            (32)     (14)     (119)      (40)
---------------------------------------------------------------------
Other net operating activities      $ 21   $ (40)    $ (97)   $ (122)
---------------------------------------------------------------------


Mine Statistics

                                            UNITED STATES
---------------------------------------------------------------------
                                     Betze-Post                Meikle
Three months ended Sept. 30,    2003       2002       2003       2002
---------------------------------------------------------------------
Tons mined (thousands)        35,714     35,456        426        411
Tons processed (thousands)     2,433      2,704        410        423
Average grade (ounces per
 ton)                          0.244      0.151      0.390      0.389
Recovery rate (percent)        83.3%      82.0%      89.5%      91.1%
---------------------------------------------------------------------
Production (thousands of
 ounces)                         495        334        143        150

Production costs per ounce
  Cash operating costs         $ 194      $ 239      $ 245      $ 190
  Royalties and production
   taxes                          18          8         17         16
---------------------------------------------------------------------
  Total cash costs               212        247        262        206
  Amortization and
   reclamation                    49         62        132        125
---------------------------------------------------------------------
Total production costs         $ 261      $ 309      $ 394      $ 331
---------------------------------------------------------------------
Capital expenditures (US$
 millions)                       $ 6        $ 3        $ 6        $ 8
---------------------------------------------------------------------


Nine months ended Sept. 30,     2003       2002       2003       2002
---------------------------------------------------------------------
Tons mined (thousands)       108,545    108,775      1,211      1,194
Tons processed (thousands)     7,596      7,624      1,199      1,190
Average grade (ounces per
 ton)                          0.198      0.158      0.384      0.413
Recovery rate (percent)        82.3%      83.1%      87.9%      91.0%
---------------------------------------------------------------------
Production (thousands of
 ounces)                       1,235      1,004        404        448

Production costs per ounce
  Cash operating costs         $ 209      $ 224      $ 232      $ 191
  Royalties and production
   taxes                          18          6         19         13
---------------------------------------------------------------------
  Total cash costs               227        230        251        204
  Amortization and
   reclamation                    52         62        123        119
---------------------------------------------------------------------
Total production costs         $ 279      $ 292      $ 374      $ 323
---------------------------------------------------------------------
Capital expenditures (US$
 millions)                      $ 20        $ 6       $ 20       $ 29
---------------------------------------------------------------------


                                            UNITED STATES
---------------------------------------------------------------------
                               Goldstrike Total        Round Mountain
Three months ended Sept. 30,    2003       2002       2003       2002
---------------------------------------------------------------------
Tons mined (thousands)        36,140     35,867      5,116      7,984
Tons processed (thousands)     2,843      3,127      7,688      7,425
Average grade (ounces per
 ton)                          0.265      0.189      0.015      0.019
Recovery rate (percent)        84.6%      84.9%        N/A        N/A
---------------------------------------------------------------------
Production (thousands of
 ounces)                         638        484         92        100

Production costs per ounce
  Cash operating costs         $ 204      $ 223      $ 143      $ 160
  Royalties and production
   taxes                          18         10         27         14
---------------------------------------------------------------------
  Total cash costs               222        233        170        174
  Amortization and
   reclamation                    66         82         55         72
---------------------------------------------------------------------
Total production costs         $ 288      $ 315      $ 225      $ 246
---------------------------------------------------------------------
Capital expenditures (US$
 millions)                      $ 12       $ 11        $ 3        $ 1
---------------------------------------------------------------------


Nine months ended Sept. 30,     2003       2002       2003       2002
---------------------------------------------------------------------
Tons mined (thousands)       109,756    109,969     19,829     24,214
Tons processed (thousands)     8,795      8,814     22,637     23,877
Average grade (ounces per
 ton)                          0.223      0.198      0.018      0.019
Recovery rate (percent)        83.6%      85.7%        N/A        N/A
---------------------------------------------------------------------
Production (thousands of
 ounces)                       1,639      1,452        302        289

Production costs per ounce
  Cash operating costs         $ 215      $ 214      $ 148      $ 167
  Royalties and production
   taxes                          19          8         20         13
---------------------------------------------------------------------
  Total cash costs               234        222        168        180
  Amortization and
   reclamation                    70         79         53         69
---------------------------------------------------------------------
Total production costs         $ 304      $ 301      $ 221      $ 249
Capital expenditures (US$
 millions)                      $ 40       $ 35        $ 5        $ 7
---------------------------------------------------------------------


Mine Statistics

                                        AUSTRALIA
---------------------------------------------------------------------
Three months           Plutonic      Darlot     Lawlers    Kalgoorlie
 ended Sept. 30,    2003   2002  2003  2002  2003  2002   2003   2002
---------------------------------------------------------------------
Tons mined
 (thousands)       4,222  4,047   227   215   208 1,999 13,177 11,491
Tons processed
 (thousands)         768    909   220   216   191   177  1,883  1,702
Average grade
 (ounces per ton)  0.139  0.098 0.176 0.175 0.138 0.176  0.069  0.059
Recovery rate
 (percent)         90.2%  89.8% 96.4% 97.2% 95.6% 97.6%  83.8%  82.1%
---------------------------------------------------------------------
Production
 (thousands of
 ounces)              97     81    38    38    25    30    110     94

Production costs
 per ounce
  Cash operating
   costs            $172   $179  $157  $156  $195  $161   $189   $221
  Royalties and
   production taxes    7      8     6     8     6     7      6      7
---------------------------------------------------------------------
  Total cash costs   179    187   163   164   201   168    195    228
  Amortization and
   reclamation        34     33    53    44    44    39     40     52
---------------------------------------------------------------------
Total production
 costs              $213   $220  $216  $208  $245  $207   $235   $280
---------------------------------------------------------------------
Capital expenditures
 (US$ millions)      $15     $6    $2    $3    $3    $2    $10     $4
---------------------------------------------------------------------


Nine months ended
 Sept. 30,          2003   2002  2003  2002  2003  2002   2003   2002
---------------------------------------------------------------------
Tons mined
 (thousands)      11,481 10,803   665   629   952 2,786 36,229 34,181
Tons processed
 (thousands)       2,279  2,594   655   629   597   535  5,327  5,266
Average grade
 (ounces per ton)  0.120  0.096 0.185 0.174 0.125 0.163  0.071  0.060
Recovery rate
 (percent)         89.5%  89.9% 96.9% 97.1% 95.9% 97.1%  85.1%  83.2%
---------------------------------------------------------------------
Production
 (thousands of
 ounces)             246    223   118   105    72    85    321    262

Production costs
 per ounce
  Cash operating
   costs            $184   $175  $152  $161  $235  $168   $199   $213
  Royalties and
   production taxes    8      8     7     8     7     8      8      7
---------------------------------------------------------------------
  Total cash costs   192    183   159   169   242   176    207    220
  Amortization and
   reclamation        24     36    50    46    37    40     47     58
---------------------------------------------------------------------
Total production
 costs              $216   $219  $209  $215  $279  $216   $254   $278
---------------------------------------------------------------------
Capital expenditures
 (US$ millions)      $40    $14    $5    $5   $13    $4    $12     $7
---------------------------------------------------------------------


Mine Statistics

                                           CANADA
---------------------------------------------------------------------
Three months                Hemlo      Eskay Creek     Holt-McDermott
 ended Sept. 30,    2003     2002    2003     2002      2003     2002
---------------------------------------------------------------------
Tons mined
 (thousands)       1,050      995      71       60       132      118
Tons processed
 (thousands)         528      455      71       65       133      119
Average grade
 (ounces per ton)  0.145    0.146   1.387    1.448     0.192    0.168
Recovery rate
 (percent)         95.3%    95.7%   93.7%    93.6%     94.5%    94.7%
---------------------------------------------------------------------
Production
 (thousands of
 ounces)              73       63      87       85        24       19

Production costs
 per ounce
  Cash operating
   costs            $202     $237      $4      $39      $202     $174
  Royalties and
   production taxes    9        7       5        4         -        -
---------------------------------------------------------------------
  Total cash costs   211      244       9       43       202      174
  Amortization and
   reclamation        41       41     139      135       134      105
---------------------------------------------------------------------
Total production
 costs              $252     $285    $148     $178      $336     $279
---------------------------------------------------------------------
Capital expenditures
 (US$ millions)       $2       $2      $1       $5        $-       $2
---------------------------------------------------------------------


Nine months ended
 Sept. 30,          2003     2002    2003     2002      2003     2002
---------------------------------------------------------------------
Tons mined
 (thousands)       3,139    3,012     208      185       415      378
Tons processed
 (thousands)       1,457    1,413     211      189       409      378
Average grade
 (ounces per ton)  0.147    0.139   1.417    1.498     0.172    0.173
Recovery rate
 (percent)         95.0%    94.4%   93.6%    93.7%     94.5%    94.7%
---------------------------------------------------------------------
Production
 (thousands of
 ounces)             203      186     269      262        66       62

Production costs
 per ounce
  Cash operating
   costs            $218     $234     $58      $32      $248     $166
  Royalties and
   production taxes    8        8       4        4         -        -
---------------------------------------------------------------------
  Total cash costs   226      242      62       36       248      166
  Amortization and
   reclamation        41       41     132      131       127       97
---------------------------------------------------------------------
Total production
 costs              $267     $283    $194     $167      $375     $263
---------------------------------------------------------------------
Capital expenditures
 (US$ millions)       $7       $5      $4       $8        $-       $5
---------------------------------------------------------------------


Mine Statistics
                                           PERU              TANZANIA
---------------------------------------------------------------------
                                        Pierina            Bulyanhulu
Three months ended Sept. 30,    2003       2002       2003       2002
---------------------------------------------------------------------
Tons mined (thousands)        11,067      8,204        215        241
Tons processed (thousands)         -          -        213        265
Average grade (ounces per ton) 0.070      0.083      0.360      0.376
Recovery rate (percent)            -          -      88.6%      86.5%
---------------------------------------------------------------------
Production (thousands of
 ounces)                         215        219         68         86

Production costs per ounce
  Cash operating costs           $81        $77       $265       $192
  Royalties and production
   taxes                           -          -         12          7
---------------------------------------------------------------------
  Total cash costs                81         77        277        199
  Amortization and
   reclamation                   183        190        136        100
---------------------------------------------------------------------
Total production costs          $264       $267       $413       $299
---------------------------------------------------------------------
Capital expenditures (US$
 millions)                        $4         $2         $8        $12
---------------------------------------------------------------------


Nine months ended Sept. 30,     2003       2002       2003       2002
---------------------------------------------------------------------
Tons mined (thousands)        29,395     23,446        687        684
Tons processed (thousands)         -          -        719        801
Average grade (ounces per ton) 0.075      0.075      0.371      0.371
Recovery rate (percent)            -          -      88.0%      85.2%
---------------------------------------------------------------------
Production (thousands of
 ounces)                         706        617        235        256

Production costs per ounce
  Cash operating costs           $81        $74       $218       $195
  Royalties and production
   taxes                           -          -         11          8
---------------------------------------------------------------------
  Total cash costs                81         74        229        203
  Amortization and
   reclamation                   183        190        122         96
---------------------------------------------------------------------
Total production costs          $264       $264       $351       $299
---------------------------------------------------------------------
Capital expenditures (US$
 millions)                        $9         $4        $27        $44
---------------------------------------------------------------------

CORPORATE OFFICE                    TRANSFER AGENTS AND REGISTRARS
Barrick Gold Corporation            CIBC Mellon Trust Company
BCE Place, Canada Trust Tower,      P.O. Box 7010, Adelaide Street
Suite 3700                          Postal Station
161 Bay Street, P.O. Box 212        Toronto, Ontario M5C 2W9
Toronto, Canada M5J 2S1             Tel: (416) 643-5500
Tel: (416) 861-9911                 Toll-free throughout
Fax: (416) 861-0727                 North America: 1-800-387-0825
Toll-free within Canada             Fax: (416) 643-5501
and United States: 1-800-720-7415   Email: inquiries@cibcmellon.ca
Email: investor@barrick.com         Web site: www.cibcmellon.com
Web site: www.barrick.com

SHARES LISTED (ABX)                 Mellon Investor Services L.L.C.
The Toronto Stock Exchange          85 Challenger Road,
The New York Stock Exchange         Overpeck Center
The London Stock Exchange           Ridgefield Park,
The Swiss Stock Exchange            New Jersey 07660
La Bourse de Paris                  Tel: (201) 329-8660
                                    Toll-free within
                                    the United States:
RECENT RESEARCH REPORTS             1-800-589-9836
BMO Nesbitt Burns                   Web site:
CIBC World Markets                  www.mellon-investor.com
Citigroup Smith Barney
Credit Suisse First Boston          INVESTOR CONTACT:
Griffiths McBurney & Partners       Kathy Sipos
Goldman Sachs                       Manager,
HSBC                                Investor Relations
JP Morgan                           Tel: (416) 307-7441
Lehman Brothers                     Email: ksipos@barrick.com
Merrill Lynch                       MEDIA CONTACT:
National Bank                       Vincent Borg
Prudential Financial                Vice President,
Research Capital                    Corporate Communications
RBC Capital Markets                 Tel: (416) 307-7477
Salman Partners                     Email: vborg@barrick.com
Scotia Capital
Smith Barney Citigroup
Westwind Partners

Barrick's exploration programs are designed and conducted under the supervision of Alexander J. Davidson, P. Geo., Executive Vice President, Exploration of Barrick. For information on the geology, exploration activities generally, and drilling and analysis procedures on Barrick's material properties, see Barrick's most recent Annual Information Form on file with Canadian provincial securities regulatory authorities and the U.S. Securities and Exchange Commission. Certain statements included herein, including those regarding production, costs, timing of permitting , construction or production, and other statements that express management's expectations or estimates of our future performance, constitute "forward-looking statements" within the meaning of the United States Private Securities Litigation Reform Act of 1995. The words "believe", "expect", "anticipate", "contemplate", "target", "plan", "intends", "continue", "budget", "estimate", "may", "will", "schedule", and similar expressions identify forward-looking statements. Forward-looking statements are necessarily based upon a number of estimates and assumptions that, while considered reasonable by management are inherently subject to significant business, economic and competitive uncertainties and contingencies. In particular, our Management's Discussion and Analysis includes many such forward-looking statements and we caution you that such forward-looking statements involve known and unknown risks, uncertainties and other factors that may cause the actual financial results, performance or achievements of Barrick to be materially different from our estimated future results, performance or achievements expressed or implied by those forward-looking statements and our forward-looking statements are not guarantees of future performance. These risks, uncertainties and other factors include, but are not limited to: changes in the worldwide price of gold or certain other commodities (such as silver, copper, diesel fuel and electricity) and currencies; changes in interest rates or gold lease rates that could impact realized prices under our forward sales program; legislative, political or economic developments in the jurisdictions in which Barrick carries on business; operating or technical difficulties in connection with mining or development activities; the speculative nature of gold exploration and development, including the risks of diminishing quantities or grades of reserves; and the risks involved in the exploration, development and mining business. These factors are discussed in greater detail in Barrick's most recent Form 40-F/Annual Information on file with the U.S. Securities and Exchange Commission and Canadian provincial securities regulatory authorities.

Barrick expressly disclaims any intention or obligation to update or revise any forward-looking statements whether as a result of new information, events or otherwise.

    CONTACT: Barrick Gold Corporation
             Vincent Borg, 416-307-7477
             Fax: 416-861-1509
             media@barrick.com

    SOURCE: Barrick Gold Corporation

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Gold  $ 1,254.33 +0.58 +0.05% Volume: December 14, 2017
ABX NYSE  $ 14.17 +0.06 +0.42% Volume: 10,953,284 December 14, 2017
ABX TSX  $ 18.06 -0.07 -0.39% Volume: 2,743,504 December 14, 2017
Gold  $ 1,254.33 +0.58 +0.05% Volume: December 14, 2017

Our vision is the generation of wealth through responsible mining — wealth for our owners, our people, and the countries and communities with which we partner.

World Gold Council MemberMember of ICMM

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