XML 136 R68.htm IDEA: XBRL DOCUMENT v3.8.0.1
FINANCIAL INSTRUMENTS (Tables)
 12 Months Ended
Dec. 31, 2017
Financial Instruments [Abstract]  
Cash and equivalents
 
As at December 31, 2017

As at December 31, 2016

Cash deposits

$662


$1,009

Term deposits
427

654

Money market investments
1,145

726

 

$2,234


$2,389
Debt and interest
 
Closing balance December 31, 2016

Proceeds
Repayments
Amortization and other2

Closing balance December 31, 2017

4.4%/5.7% notes3,9

$1,467


$—


$—


$1


$1,468

3.85%/5.25% notes
1,078

—

—

1

1,079

5.80% notes4,9
395

—

—

—

395

6.35% notes5,9
593

—

—

—

593

Other fixed rate notes6,9
1,607

—

(279
)
(2
)
1,326

Project financing
400

—

(423
)
23

—

Capital leases7
114

—

(68
)
—

46

Other debt obligations
609

—

(4
)
(2
)
603

4.10%/5.75% notes8,9
1,569

—

(731
)
4

842

Acacia credit facility10
99

—

(28
)
—

71

 

$7,931


$—


($1,533
)

$25


$6,423

Less: current portion11
(143
)
—

—

—

(59
)
 

$7,788


$—


($1,533
)

$25


$6,364

 
 
Closing balance December 31, 2015

Proceeds

Repayments

Amortization and other2

Closing balance December 31, 2016

4.4%/5.7% notes3,9

$2,182


$—


($721
)

$6


$1,467

3.85%/5.25% notes
1,077

—

—

1

1,078

5.80% notes4,9
395

—

—

—

395

6.35% notes5,9
592

—

—

1

593

Other fixed rate notes6,9
2,451

—

(848
)
4

1,607

Project financing
646

—

(254
)
8

400

Capital leases7
153

2

(41
)
—

114

Other debt obligations
654

3

(46
)
(2
)
609

2.5%/4.10%/5.75% notes8,9
1,690

—

(123
)
2

1,569

Acacia credit facility10
128

—

(29
)
—

99

 

$9,968


$5


($2,062
)

$20


$7,931

Less: current portion11
(203
)
—

—

—

(143
)
 

$9,765


$5


($2,062
)

$20


$7,788

1 
The agreements that govern our long-term debt each contain various provisions which are not summarized herein. These provisions allow Barrick, at its option, to redeem indebtedness prior to maturity at specified prices and also may permit redemption of debt by Barrick upon the occurrence of certain specified changes in tax legislation.
2 
Amortization of debt premium/discount and increases (decreases) in capital leases.
3 
Consists of $1.5 billion (2016: $1.5 billion) in conjunction with our wholly-owned subsidiary Barrick North America Finance LLC (“BNAF”). This consists of $629 million (2016: $629 million) of BNAF notes due 2021 and $850 million (2016: $850 million) of BNAF notes due 2041.
4 
Consists of $400 million (2016: $400 million) of 5.80% notes which mature in 2034.
5 
Consists of $600 million (2016: $600 million) of 6.35% notes which mature in 2036.
6 
Consists of $1.3 billion (2016: $1.6 billion) in conjunction with our wholly-owned subsidiary BNAF and our wholly-owned subsidiary Barrick (PD) Australia Finance Pty Ltd. (“BPDAF”). This consists of $248 million (2016: $248 million) of BPDAF notes due 2020, $250 million (2016: $250 million) of BNAF notes due 2038 and $850 million (2016: $850 million) of BPDAF notes due 2039.
7 
Consists primarily of capital leases at Pascua-Lama, $13 million and Lagunas Norte, $27 million (2016: $50 million and $56 million, respectively).
8 
Consists of $850 million (2016: $1.6 billion) in conjunction with our wholly-owned subsidiary BNAF.
9 
We provide an unconditional and irrevocable guarantee on all BNAF, BPDAF, Barrick Gold Finance Company (“BGFC”), and Barrick (HMC) Mining (“BHMC”) notes and generally provide such guarantees on all BNAF, BPDAF, BGFC, and BHMC notes issued, which will rank equally with our other unsecured and unsubordinated obligations.
10 
Consists of an export credit backed term loan facility.
11 
The current portion of long-term debt consists of project financing ($nil; 2016: $72 million), other debt obligations ($4 million; 2016: $5 million), capital leases ($27 million; 2016: $38 million) and Acacia credit facility ($28 million; 2016: $28 million).
 
 
2017
 
2016
For the years ended December 31
Interest cost

Effective rate1

 
Interest cost

Effective rate1

4.4%/5.7% notes

$77

5.23
%
 

$104

5.09
%
3.85%/5.25% notes
53

4.87
%
 
53

4.87
%
5.80% notes
23

5.85
%
 
23

5.85
%
6.35% notes
38

6.41
%
 
38

6.41
%
Other fixed rate notes
93

6.38
%
 
128

6.75
%
Project financing
14

7.04
%
 
33

6.23
%
Capital leases
3

3.60
%
 
5

4.02
%
Other debt obligations
31

6.55
%
 
36

6.09
%
4.10%/5.75% notes
72

5.12
%
 
82

4.98
%
Acacia credit facility
6

3.59
%
 
7

3.59
%
Deposits on Pascua-Lama silver sale agreement (note 29)
66

8.37
%
 
63

8.37
%
Deposits on Pueblo Viejo gold and silver streaming agreement (note 29)
35

6.14
%
 
37

6.34
%
 

$511

 
 

$609

 
1 
The effective rate includes the stated interest rate under the debt agreement, amortization of debt issue costs and debt discount/premium and the impact of interest rate contracts designated in a hedging relationship with debt.
Scheduled debt repayments
 
Issuer
Maturity Year
2018

2019

2020

2021

2022

2023 and thereafter

Total

4.95% notes3
BPDAF
2020

$—


$—


$248


$—


$—


$—


$248

7.31% notes2
BGC
2021
—

—

—

7

—

—

7

4.40% notes
BNAF
2021
—

—

—

629

—

—

629

3.85% notes
BGC
2022
—

—

—

—

337

—

337

7.73% notes2
BGC
2025
—

—

—

—

—

7

7

7.70% notes2
BGC
2025
—

—

—

—

—

5

5

7.37% notes2
BGC
2026
—

—

—

—

—

32

32

8.05% notes2
BGC
2026
—

—

—

—

—

15

15

6.38% notes2
BGC
2033
—

—

—

—

—

200

200

5.80% notes
BGC
2034
—

—

—

—

—

200

200

5.80% notes
BGFC
2034
—

—

—

—

—

200

200

6.45% notes2
BGC
2035
—

—

—

—

—

300

300

6.35% notes
BHMC
2036
—

—

—

—

—

600

600

7.50% notes3
BNAF
2038
—

—

—

—

—

250

250

5.95% notes3
BPDAF
2039
—

—

—

—

—

850

850

5.70% notes
BNAF
2041
—

—

—

—

—

850

850

5.25% notes
BGC
2042
—

—

—

—

—

750

750

5.75% notes
BNAF
2043
—

—

—

—

—

850

850

Other debt obligations2
 
 
4

5

—

—

—

—

9

Acacia credit facility
 
 
28

28

15

—

—

—

71

 
 
 

$32


$33


$263


$636


$337


$5,109


$6,410

Minimum annual payments under capital leases
 
 

$27


$11


$4


$1


$1


$2


$46

1 
This table illustrates the contractual undiscounted cash flows, and may not agree with the amounts disclosed in the consolidated balance sheet.
2 
Included in Other debt obligations in the Long-Term Debt table.
3 
Included in Other fixed rate notes in the Long-Term Debt table.
Market risks
In the normal course of business, our assets, liabilities and forecasted transactions, as reported in US dollars, are impacted by various market risks including, but not limited to:
 
 
 
Item
 
Impacted by
 
 
●    Sales
 
 
●    Prices of gold, silver and copper
 
 
 
o    By-product credits
 
 
o    Prices of silver, copper and gold
 
 
 
●    Cost of sales
 
 
 
 
o    Consumption of diesel fuel, propane, natural gas, and electricity
 
o    Prices of diesel fuel, propane, natural gas, and electricity
 
 
o    Non-US dollar expenditures
 
o    Currency exchange rates - US dollar versus A$, ARS, C$, CLP, DOP, EUR, PGK, TZS, ZAR, and ZMW
 
 
●    General and administration, exploration and evaluation costs
 
●    Currency exchange rates - US dollar versus A$, ARS, C$, CLP, DOP, GBP, PGK, TZS, ZAR, and ZMW
 
 
●    Capital expenditures
 
 
 
 
o    Non-US dollar capital expenditures
 
o    Currency exchange rates - US dollar versus A$, ARS, C$, CLP, DOP, EUR, GBP, PGK, and ZAR
 
 
o    Consumption of steel
 
o    Price of steel
 
 
●    Interest earned on cash and equivalents
 
●    US dollar interest rates
 
 
●    Interest paid on fixed-rate borrowings
 
●    US dollar interest rates
Derivative assets and liabilities
 
2017
2016
At January 1

($76
)

($263
)
Derivatives cash (inflow) outflow
 
 
Operating activities
62

156

Change in fair value of:
 
 
Non-hedge derivatives
4

6

Cash flow hedges:
 
 
Effective portion
(19
)
25

Ineffective portion
5

—

Excluded from effectiveness changes
(5
)
—

At December 31

($29
)

($76
)
Classification:
 
 
Other current assets

$2


$1

Other long-term assets
1

1

Other current liabilities
(30
)
(50
)
Other long-term obligations
(2
)
(28
)
 

($29
)

($76
)
  
Notional Amount by Term to Maturity
Accounting Classification by Notional Amount
 
 
Within 1 year
2 to 3 years
4 to 5 years
Total
Cash flow hedge
Non-Hedge
Fair value (USD)
US dollar interest rate contracts (US$ millions)
 
 
 
 
 
 
 
Total receive - float swap positions

$28


$43


$—


$71


$71


$—


$1

Currency contracts
 
 
 
 
 
 
 
A$:US$ contracts (A$ millions)
21

—

—

21

—

21

—

C$:US$ contracts (C$ millions)
8

—

—

8

—

8

—

PGK:US$ contracts (PGK millions)
32

—

—

32

—

32

—

Commodity contracts
 
 
 
 
 
 
 
Gold collar sell contracts (thousands of ounces)
105

—

—

105

—

105

2

Copper bought floor contracts (millions of pounds)
60

—

—

60

60

—

(8
)
Fuel contracts (thousands of barrels)1
1,244

42

—

1,286

840

446

(24
)
1 
Fuel contracts represent a combination of WTI swaps and Brent options. These derivatives hedge physical supply contracts based on the price of fuel across our operating mine sites plus a spread. WTI represents West Texas Intermediate and Brent represents Brent Crude Oil.
 
          Asset Derivatives
          Liability Derivatives
 
Balance Sheet Classification
Fair Value as at Dec. 31, 2017

Fair Value as at Dec. 31, 2016

Balance Sheet Classification
Fair Value as at Dec. 31, 2017

Fair Value as at Dec. 31, 2016

Derivatives designated as hedging instruments
 
 
 
 
 
 
US dollar interest rate contracts
Other assets

$1


$1

Other liabilities

$—


$—

Commodity contracts
Other assets
—

—

Other liabilities
25

71

Total derivatives classified as hedging instruments
 

$1


$1

 

$25


$71

Derivatives not designated as hedging instruments
 
 
 
 
 
 
Commodity contracts
Other assets

$2


$1

Other liabilities

$7


$7

Total derivatives not designated as hedging instruments
 

$2


$1

 

$7


$7

Total derivatives
 

$3


$2

 

$32


$78
Cash flow hedge gains (losses)
 
Commodity price hedges
Currency hedges
Interest rate hedges
 
  
Gold/Silver

Copper

Fuel

Operating costs

General and administrative costs

Capital expenditures

Long-term debt

Total

At January 1, 2016

$14


$—


($102
)

($30
)

$—


$—


($22
)

($140
)
Effective portion of change in fair value of hedging instruments
—

—

23

2

—

—

—

25

Transfers to earnings:
 
 
 
 
 
 
 
 
On recording hedged items in earnings/PP&E1
(5
)
—

47

28

—

—

2

72

At December 31, 2016

$9


$—


($32
)

$—


$—


$—


($20
)

($43
)
Effective portion of change in fair value of hedging instruments
—

(11
)
(8
)
—

—

—

—

(19
)
Transfers to earnings:
 
 
 
 
 
 
 
 
On recording hedged items in earnings/PP&E1
(7
)
4

27

—

—

—

3

27

Hedge ineffectiveness due to changes in original forecasted transaction
—

—

5

—

—

—

—

5

At December 31, 2017

$2


($7
)

($8
)

$—


$—


$—


($17
)

($30
)
Hedge gains/losses classified within
Gold/Silver sales

Copper sales

Cost of sales

Cost of sales

General and administrative costs

Property, plant, and equipment

Interest expense

Total

Portion of hedge gain (loss) expected to affect 2018 earnings2

$2


($7
)

($8
)

$—


$—


$—


($1
)

($14
)
1 
Realized gains (losses) on qualifying currency hedges of capital expenditures are transferred from OCI to PP&E on settlement.
2 
Based on the fair value of hedge contracts at December 31, 2017.
Derivatives in cash flow hedging relationships
Amount of gain (loss) recognized in OCI
Location of gain (loss) transferred from OCI into income/PP&E (effective portion)
Amount of gain (loss) transferred from OCI into income (effective portion)
Location of gain (loss) recognized in income (ineffective portion and amount excluded from effectiveness testing)
Amount of gain (loss) recognized in income (ineffective portion and amount excluded from effectiveness testing)
 
2017

2016

 
2017

2016

 
2017

2016

Interest rate contracts

($1
)

$—

Finance income/ finance costs

($3
)

($2
)
Gain (loss) on non-hedge derivatives

$—


$—

Foreign exchange contracts
—

2

Cost of sales/general and administrative costs/PP&E
—

(28
)
Gain (loss) on non-hedge derivatives
—

—

Commodity contracts
(18
)
23

Revenue/cost of sales
(24
)
(42
)
Gain (loss) on non-hedge derivatives
(5
)
—

Total

($19
)

$25

 

($27
)

($72
)
 

($5
)

$—
Gains (losses) on non-hedge derivatives
For the years ended December 31
2017
2016
Commodity contracts
 
 
Gold

$4


$2

Silver1
7

6

Copper
(1
)
—

Fuel
—

5

Currency Contracts
1

(1
)
 

$11


$12

Hedge ineffectiveness
(5
)
—

 

$6


$12

1 
Relates to the amortization of crystallized OCI.