DESPITE ongoing depressed commodity prices, Barrick Gold recorded positive free cash flow for the first time in four years, according to its 2015 full year report released in mid-February.

Barrick generated US$471 million in free cash flow for the full year, and US$387 million in the fourth quarter of 2015, the company said.

Adjusted net earnings were US$344 million for the full year, with the company reporting US$91 million in the December quarter 2015.

At the company’s investor day on 22 February, Barrick chairman John Thornton said the most important news of the year is that the company did exactly what it said it would do.

“We reduced our debt by US$3 billion, nearly a quarter of our total debt.”

“We reduced our all in sustaining costs from US$864 to US$831 per ounce.”

All in sustaining costs below US$700 per ounce by 2019 is on Barrick’s radar.

“We simplified our head office, eliminated management between it and the mines, and accelerated the pace at which information flows between them.”

“We pared down our portfolio, implemented a new system for allocating capital with strict investment criteria, and sold, cancelled, or deferred several projects that did not meet those requirements,” Mr Thornton added.

Barrick produced 6.12 million ounces of gold in 2015 and total capital expenditures of US$1.51 billion in 2015 were 31 per cent lower than 2014 expenditures.

In 2015, the company’s 47.5% owned Porgera mine in Papua New Guinea produced 436,000 ounces of gold at an all in sustaining cost of US$1,018 per ounce.

This reflects Barrick’s reduced interest in the operation which follows the sale of 50% of Barrick (Niugini) to Chinese company Zijin Mining Group.

In 2016, Porgera is expected to contribute 230,000 to 260,000 ounces at an all sustaining cost of US$990 to US$1,080 per ounce, the company said.

Barrick president Kelvin Dushnisky was pleased with the company’s performance.

“In addition, we significantly improved our liquidity and strengthened our balance sheet, meeting our US$3 billion debt reduction target through disciplined non-core asset sales, partnerships and free cash flow.”

“As a result, we reduced our total debt by 24% last year,” Mr Dushnisky added.

Commenting on moving away from the traditional hierarchical organisational model and into a partnership model, Mr Thornton said five of the company’s seven most senior partners have joined Barrick in the last 15 months.

“We also identified truly outstanding talent within Barrick and make them partners – in particular, people with exceptional technical talent or a demonstrated ability to build relationships of trust with host governments and other partners.”

“All of our partners will. over time, become meaningful owners whose net worth is tied to the shares. It is our intention that, over time, every single person at Barrick will become a shareholder and owner,” he said.

The Porgera joint venture is an open pit and underground gold mine located at an altitude of between 2,200-2,700 metres in the Enga province.

The operation is about 130 kilometres west of Mount Hagen and 600 kilometres north west of the capital Port Moresby, Papua New Guinea.