NEW YORK (TheStreet) -- Barrick Gold Corp. (ABX) announced today that it will initiate procedures to suspend operations at the Lumwana copper mine in Zambia following the passage of legislation that raises the royalty rate on the country's open pit mining operations to 20% from 6%.
Barrick expects its fourth-quarter financial results will include an impairment charge on the Lumwana project, which employs about 4,000 people, the Toronto-based miner said.
The company said today the mine's current net carrying value is about $1 billion.
In the first nine months of 2014, Lumwana produced 138 million pounds of copper at C3 fully allocated costs of $2.98 per pound. The mine had 6.6 billion pounds of copper in reserves as of December 31, 2013.
Shares of Barrick Gold are up 2.14% to $10.99.
Separately, TheStreet Ratings team rates BARRICK GOLD CORP as a Sell with a ratings score of D. TheStreet Ratings Team has this to say about their recommendation:
"We rate BARRICK GOLD CORP (ABX) a SELL. This is driven by multiple weaknesses, which we believe should have a greater impact than any strengths, and could make it more difficult for investors to achieve positive results compared to most of the stocks we cover. The company's weaknesses can be seen in multiple areas, such as its unimpressive growth in net income, weak operating cash flow, generally disappointing historical performance in the stock itself and feeble growth in its earnings per share."