Barrick Mining: Copper Dominance and Undervalued Potential

Barrick Mining Corporation (formerly Barrick Gold) has embarked on a strategic transformation to position itself as a global leader in copper production, capitalizing on the energy transition's insatiable demand for the metal. With a robust pipeline of projects and an undervalued stock, investors may find compelling opportunities ahead as the company transitions from gold-centric mining to a dual champion of gold and copper. This article explores Barrick's strategic pivot, key projects, financial resilience, and why its stock could be primed for a rebound.

The Strategic Pivot to Copper

Barrick's rebranding to “Barrick Mining Corporation” (effective May 2025) underscores its commitment to copper, a metal critical to renewable energy, EVs, and infrastructure. The company aims to grow copper production to 500,000 metric tons annually by 2030, up from 170,000 tons in 2023, while maintaining gold output at 5 million ounces. This dual focus leverages its expertise in large-scale mine development and low-cost operations, positioning it to capture a $5 trillion market for critical minerals by 2030.

Key Projects Powering Growth

Three projects are central to Barrick's copper ambitions:

1. Reko Diq (Pakistan): The Titan of Copper-Gold

• Scale: One of the world's largest undeveloped copper-gold deposits, with 14 million ounces of gold and 12.3 billion pounds of copper.
• Timeline: Phase 1 construction began in Q1 2025, targeting first production by late 2028. Full development requires $6 billion in capital.
• Impact: Phase 1 will produce 240,000 tons of copper annually, rising to 460,000 tons by 2034.

2. Lumwana Expansion (Zambia): A Copper Powerhouse

• Scale: A $2 billion expansion will double processing capacity to 54 million tons/year, extending the mine's life to 2057.
• Output: Average annual copper production will hit 240,000 tons, with peak capacity of 350 million tons/year by 2039.
• Environmental Stewardship: Includes a $2 million REDD+ initiative to offset deforestation.

3. Fourmile (Nevada, U.S.): High-Grade Potential

• Advancement: Moving toward prefeasibility after a successful drilling program.
• Resource: 21 million ounces of inferred gold (3.3 g/t), with copper potential.

Financial Fortitude and Undervaluation

Barrick's 2024 results demonstrate resilience:
- Net earnings rose 69% to $2.14 billion, with EBITDA hitting a decade-high of $5.19 billion.
- Free cash flow doubled to $1.32 billion, enabling a $498 million share buyback and a $0.10/share dividend.
- Balance sheet strength: $4.07 billion in cash and net debt of just $655 million provide flexibility for growth without equity dilution.

Despite these fundamentals, Barrick's stock trades at a discount to its peers. At a P/E of 10.5x, it lags peers like Freeport-McMoRan (FCX: 14.2x) and Southern Copper (SCCO: 16.8x). This undervaluation may reflect geopolitical risks (e.g., Pakistan's regulatory hurdles) or investor skepticism about project execution. However, with $1 billion in buybacks planned for 2025, management is signaling confidence in its stock's potential.

Upcoming Milestones to Watch

• Q3 2025: Final environmental approvals for Reko Diq.
• End-2028: First copper production from Reko Diq.
• 2030: Target to hit 500,000 tons of copper annually.

Risks and Mitigations

• Geopolitical Risks: Reko Diq's success hinges on Pakistan's regulatory cooperation and financing. Barrick has secured $3 billion in project financing and a 50-50 joint venture with the Pakistani government, mitigating some risks.
• Copper Price Volatility: Barrick's projects assume a $4.03/lb copper price, but prices have swung between $3.50–$5.00/lb. Gold's stability (its price rose 3% YTD) provides a hedge.
• Operational Delays: Pueblo Viejo's ramp-up faced hiccups in 2024, but Lumwana's expansion is on track with permits secured.

Investment Thesis: Buy the Dip

Barrick's undervalued stock, robust cash flow, and transformational projects make it a compelling long-term play. Key catalysts include:
1. Reko Diq's final approvals (Q3 2025).
2. Copper price stability as EV adoption and renewables drive demand.
3. Share buybacks boosting EPS and signaling management confidence.

A price target of $25–$30/share (vs. $20.50 current) is achievable if copper prices hold above $3.50/lb and Reko Diq progresses smoothly. Investors should consider a buy rating with a hold if geopolitical risks escalate.

Conclusion: A Bold Bet on the Energy Transition

Barrick's strategic shift to copper is a bold move to capitalize on a secular trend. With its financial firepower, low-cost operations, and world-class projects, it's well-positioned to become a top-tier copper producer. While risks remain, the stock's undervaluation and upcoming milestones make it a high-reward opportunity for investors willing to ride the energy transition wave.

Investment Recommendation: Buy with a 12–24 month horizon.