Something quite interesting has taken place at the world’s largest gold miner over the past few years. While certain mining costs, like energy, have declined since the price of oil plummeted from over $100 a barrel in 2013 to an average $43 in 2016, quite the opposite has taken place with the cost of labor.
Barrick Gold, the world’s largest gold miner, is paying a great deal more in labor to produce an ounce of the precious shiny yellow metal than it did just five years ago. How much more? Well, it turns out to be quite a lot.
For example, Barrick Gold only paid $1.5 billion in labor costs to produce 7.8 million ounces (Moz) of gold in 2010. However, this increased significantly in 2015, as Barrick paid $1.86 billion in annual payroll to produce 6.1 Moz of gold. While the labor cost only increased $360 million in 2015 versus 2010, total gold production declined by 1.7 Moz.
I took the annual payroll data from Barrick Gold’s Sustainability Reports, shown in the table below:
This post was published at SRSrocco Report on February 19, 2017.