The Cost PositionNarrow moat

The most important number in gold mining is not the gold price, which every miner faces alike, but the cost of getting an ounce out of the ground, which varies enormously from company to company and mine to mine. The industry measures it with all-in sustaining cost, or AISC — a figure that folds together not just the cash cost of mining but the sustaining capital, royalties, and overhead needed to keep production level. Where a miner sits on the AISC cost curve determines everything about how it fares through the cycle, and Barrick sits, thanks to its Tier-One assets, in the lower half.

This matters most at the bottom of the cycle. When the gold price falls toward the industry's average cost, the high-cost miners — the ones running old, low-grade, or badly located mines — start losing money on every ounce and are forced to cut, idle, or close. A low-cost producer like Barrick keeps mining profitably right through the trough, which lets it survive, hold its assets, and sometimes buy distressed rivals cheaply while they are on their knees. Low cost is, above all, staying power.

At the top of the cycle the same position becomes a windfall. A mine's costs are largely fixed by its geology and scale; they do not rise much when the gold price doubles. So when gold vaulted from roughly $1,800 to well over $4,000 an ounce¹, Barrick's AISC crept up only modestly — dragged higher mainly by royalties that scale with the price — while the gap between price and cost, which is the margin, exploded. That is operating leverage, and it is why the company's cash flow in 2025 and 2026 has been extraordinary.

The discipline behind the cost position owes much to the Randgold merger of 2019² and to Mark Bristow, whose culture prized return on capital and cash cost over the vanity of ounces produced. But keep the whole picture in view. A good cost position is a defensive advantage — it decides who survives and who thrives across the cycle — not a moat that lifts Barrick above the price itself. It makes Barrick a better miner than most. It does not make mining a good business.