Barrick Gold’s (ABX) CEO, Jamie Sokalsky, stated on Tuesday that “The factors are in place more than ever for a further rise in the gold price.”
Sokalsky, who replaced Aaron Regent as the head of the world’s largest gold mining company in June of this year, discussed his views on the yellow metal in an interview with CNBC this morning.
The Barrick Gold CEO based his positive outlook on several factors, noting that “We’ve got QE3 on the horizon, more monetary stimulus. We’ve had central banks buying a lot of gold in the first half of this year. It’s a sea change in sentiment with central banks; they’ve gone from sellers to buyers. Demand is still strong. There’s more than enough uncertainty in the world.”
In terms of a specific target for gold, Sokalsky asserted that “The gold price could definitely surpass previous highs, go above $2,000 and even higher within the next year. So very optimistic about further increases in the gold price.”
He went on to note that Barrick has “great leverage” to the price of gold. “Every $100 increase in the gold price adds $500 million of additional earnings and cash flow to the Company,” he added.
When asked about the operational challenges Barrick has faced in recent years – and which contributed to Mr. Regent’s dismissal earlier this year – Sokalsky stated that the Canadian-based gold producer in utilizing a “lot more discipline in managing the capital and assets” of the Company.
In afternoon trading, shares of ABX rose $0.41, or 1.0%, to $39.79 per share. Other notable gold stocks moving higher included Agnico-Eagle Mines (AEM) and Goldcorp (GG) – which rose by 0.9% to $48.42 and by 1.2% to $42.64 per share, respectively.
For additional forecasts and commentary on the price of gold, visit GoldAlert Pro at http://pro.goldalert.com
Premier Gold Agrees to Merge Premier Royalty with Bridgeport Ventures
Premier Gold previously provided a bridge loan facility to Premier Royalty in connection with the acquisition by Premier Royalty of certain royalties. In addition to stipulated cash payback provisions at 8% interest ( $8 million on closing and the balance within one year), Premier Gold has a one-time right to effectively convert all or a portion of the bridge loan into units of Bridgeport at a price of $1.40 per unit (on a post-consolidation basis) at or prior to closing. Each Bridgeport unit shall consist of one post-consolidation Bridgeport share and 0.375 of a Bridgeport warrant. Full Premier Gold Mines Press Release.
- The combined company (New Bridgeport) is expected to change its name to Premier Royalty Inc
- All existing directors and management of Bridgeport will resign, other than Hugh Snyder and Shastri Ramnath who will continue as directors of New Bridgeport
- Premier Gold will have the right to nominate six of the eight directors of New Bridgeport and the new management team shall be set by Premier Gold
- The transaction is expected to close in the fall of 2012
