⚠ Reserve Life Averages Away the ProblemLow threat

A reserve life of several decades is a comforting number and it is an average. Averages conceal distributions, and in mining the distribution is what matters.

Barrick's reserve life is calculated across a portfolio in which some mines have thirty years ahead of them and others have five. The five-year mines still carry full workforces, full communities, full closure obligations and full fixed costs, and when they end, the production has to be replaced immediately regardless of what the company-wide average says. A portfolio with a long mean can still face a cliff in a given year at a given operation.

The second thing an average hides is location. Reserve life concentrated in one favourable jurisdiction is worth more than the same number spread across countries where the licence is a political instrument, and Mali demonstrated that a reserve can go to zero for reasons the geology knows nothing about¹.

The genuine strength is that Barrick's long-life assets are also its biggest ones, so the mean is not being propped up by small mines with long tails. That is the right way round.

The number to watch is reserve life at the flagship operations individually, and the share of total reserves sitting in jurisdictions with enforceable title. The company-wide average is the least informative version of this statistic.