Canadian miner Barrick Gold, the world's largest gold producer, has sold its western Australian assets to Aussie rival Gold Fields as part of its restructuring plan.
Barrick's $300m (£192.3m, €224.8m) sale of its Yilgarn South properties comes amid the miner's new focus on lower cost assets, following an $8.7bn asset value writedown because of the falling price of gold in 2013.
The Yilgarn South assets include the Granny Smith, Lawlers and Darlot mines. The deal will help Gold Fields to change its focus from Africa to Australia where it can try lower costs.
"The agreement to divest Yilgarn South demonstrates further progress as we work to optimize the company's portfolio and maximize free cash flow in line with our disciplined approach to capital allocation," said Jamie Sokalsky, Barrick's president and chief executive.
Gold Fields will have the option to deliver up to 50% of the deal's cash value in its own common shares, Barrick said in a statement.
The deal is expected to be sealed at the beginning of October, but is subject to regulatory approval.
Recently, Switzerland-based miner Glencore, which completed its acquisition of miner Xstrata in May, booked a multibillion pound loss on the value of Xstrata assets in its first set of results since the two groups merged because of lower commodity prices.
Global Mining Crisis
The global mining industry has been facing challenges due to rising operating costs and falling commodity prices.
According to a London-based PricewaterhouseCoopers' (PwC) analysis, the mining industry is going through a confidence crisis over whether increasing operating costs can be controlled; uncertainty over the outlook for an improved return of capital which is at its lowest rate for a decade; and better commodity prices.
PwC's analysis is based on the top 40 mining companies, which reported a combined $110bn in capital spending for first four months of this year, a 21% fall year-on-year.
"The first four months of 2013 have been rougher and tougher than at any time in the past decade, with market values plunging $220bn, or 18%, for 37 of the world's top 40," PwC Australia's mining leader Jock O'Callaghan said.
"After years of outperformance and superior returns the industry is now facing a crisis in confidence."
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