Canadian miner Barrick Gold has completed the sale of a 50% interest in the Veladero mine in San Juan province, Argentina, to Shandong Gold Mining for $960m. 

The sale marks the completion of the first of the three steps agreed by the parties through an agreement signed in April. 

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Veladero mine produced 544,000oz of gold last year, while proven and probable mineral reserves as of 31 December last year were 6.7 million ounces of gold. 

Barrick intends to use sale proceeds to reduce debt. 

Following the transaction, the mine will be operated by the companies through the formation of a 50/50 joint venture (JV).

In addition, towards fulfillment of the second step in the agreement, Barrick and Shandong have formed a working group to explore the joint development of the Pascua-Lama deposit.

"Shandong is an ideal partner to help us unlock the untapped mineral wealth of the El Indio Belt over the long-term, while helping generate more value from Veladero today."

Being developed as an open pit operation, the Pascua-Lama project is expected to have processing facilities with a throughput capacity of 45,000tpd of ore.

The project has gold, silver, and copper mineralisation and alteration assemblages.

At the time of signing the agreement, Barrick Gold executive chairman John Thornton said: “Shandong is an ideal partner to help us unlock the untapped mineral wealth of the El Indio Belt over the long-term, while working with us to generate more value from the Veladero mine today.”

Under the agreement, the third step will see Barrick and Shandong exploring further investment opportunities on the El Indio Gold Belt on the border of Argentina and Chile. 

Image: Barrick executive chairman John Thornton (left) and Shandong Gold chairman Chen Yumin (right) mark the signing of a strategic cooperation agreement between the two companies. Photo: courtesy of Barrick Gold Corporation.