Exhibit 99.4 Managements
Discussion and
Analysis (MD&A)  Managements
Discussion and Analysis (MD&A) is intended to help the reader understand
Barrick Gold Corporation (Barrick, we, our or the Company), our
operations, financial performance and present and future business environment.
This MD&A, which has been prepared as of February 21, 2008, should be
read in conjunction with our audited consolidated financial statements for the
year ended December 31, 2007. Unless otherwise indicated, all amounts are
presented in US dollars.  For the purposes of preparing our MD&A, we consider the materiality
of information. Information is considered material if: (i) such
information results in, or would reasonably be expected to result in, a
significant change in the market price or value of our shares; or (ii) there
is a substantial likelihood that a reasonable investor would consider it
important in making an investment decision; or (iii) if it would
significantly alter the total mix of information available to investors. We
evaluate materiality with reference to all relevant circumstances, including
potential market sensitivity.  Continuous disclosure materials, including our most recent Form 40F/Annual
Information Form, annual MD&A, audited consolidated financial statements,
and Notice of Annual Meeting of Shareholders and Proxy Circular is available on
our website at www.barrick.com, on SEDAR at www.sedar.com and on EDGAR at
www.sec.gov. For an explanation of terminology unique to the mining industry,
readers should refer to the glossary on pages 74 and 75.  Cautionary
Statement on Forward-Looking Information  Certain
information contained or incorporated by reference in this MD&A, including
any information as to our future financial or operating performance,
constitutes forward-looking statements. All statements, other than statements
of historical fact, are forward-looking statements. The words believe, expect,
anticipate, contemplate, target, plan, intend, continue, budget, estimate,
may, will, schedule and similar expressions identify forward-looking
statements. Forward-looking statements are necessarily based upon a number of
estimates and assumptions that, while considered reasonable by us, are
inherently subject to significant business, economic and competitive
uncertainties and contingencies. Known and unknown factors could cause actual
results to differ materially from those projected in the forward-looking
statements. Such factors include, but are not limited to: fluctuations in the
currency markets (such as Canadian and Australian dollars, South African rand,
Chilean peso and Papua New Guinean kina versus US dollar); fluctuations in the
spot and forward price of gold and copper or certain other commodities (such as
silver, diesel fuel and electricity); changes in US dollar interest rates or
gold lease rates that could impact the mark-to-market value of outstanding
derivative instruments and ongoing payments/receipts under interest rate swaps
and variable rate debt obligations; risks arising from holding derivative
instruments (such as credit risk, market liquidity risk and mark-to-market
risk); changes in national and local government legislation, taxation,
controls, regulations and political or economic developments in Canada, the
United States, Dominican Republic, Australia, Papua New Guinea, Chile, Peru,
Argentina, South Africa, Tanzania, Russia, Pakistan or Barbados or other
countries in which we do or may carry on business in the future; business
opportunities that may be presented to, or pursued by, us; our ability to
successfully integrate acquisitions; operating or technical difficulties in
connection with mining or development activities; employee relations;
availability and increased costs associated with mining inputs and  25


labor; litigation;
the speculative nature of exploration and development, including the risks of
obtaining necessary licenses and permits; diminishing quantities or grades of
reserves; adverse changes in our credit rating; and contests over title to
properties, particularly title to undeveloped properties. In addition, there
are risks and hazards associated with the business of exploration, development
and mining, including environmental hazards, industrial accidents, unusual or
unexpected formations, pressures, cave-ins, flooding and gold bullion or copper
cathode losses (and the risk of inadequate insurance, or inability to obtain
insurance, to cover these risks). Many of these uncertainties and contingencies
can affect our actual results and could cause actual results to differ
materially from those expressed or implied in any forward-looking statements
made by, or on behalf of, us. Readers are cautioned that forward-looking
statements are not guarantees of future performance. All of the forward-looking
statements made in this MD&A are qualified by these cautionary statements.
Specific reference is made to Barricks most recent Form 40-F/Annual
Information Form on file with the SEC and Canadian provincial securities
regulatory authorities for a discussion of some of the factors underlying
forward-looking statements.  We disclaim any intention or obligation to update or revise any
forward-looking statements whether as a result of new information, future
events or otherwise, except to the extent required by applicable law.  Index  27
  Core Business and Market Overview
   Provides an overview of Barrick and outlines our core business, critical
  success factors and key performance indicators for our business, and market
  trends within the industry.31
  Enterprise Strategy and Our Ability
  to Deliver Results 
  Outlines our vision and strategy, our progress in relation to our 2007
  strategic objectives and financial priorities, and details the visions and
  strategies of our operating departments along with their strengths,
  competencies and strategic goals.36
  2007 Financial Results
   Provides a review of Barricks consolidated financial performance,
  including significant factors affecting income and cash flow. It also
  includes a review of our regional operating performance in 2007 along with an
  update on key projects.36 2007 Financial Overview38 Operational Overview  Gold40 Reserves40 Key Business Transactions41 Operating Segments Review48
  Review of Significant Operating
  Expenses  Provides analytics for variances for our
  significant operating expenditures.50
  Financial Outlook
  Provides our 2008 forecast trends for key financial and operational
  performance measures, significant assumptions supporting our forecast, and
  economic sensitivities for some of these key assumptions.52
  Review of Quarterly Results
  Provides a review of our consolidated financial performance in the fourth
  quarter, summarizes our results on a quarter by quarter basis, and includes
  an analysis of key factors impacting quarter to quarter performance.54
  Financial Condition Review
   Reviews our cash flow, balance sheet, credit rating and our approach to
  managing our capital position and capital resources to support our business
  objectives. It also discusses our contractual obligations, off balance sheet
  arrangements and financial instruments as at the end of 2007.61
  Critical Accounting Policies and
  Estimates  Summarizes key changes in accounting policies
  in 2007 and for future periods and analyzes critical accounting estimates.69
  Non GAAP Operating Performance
  Measures  Includes various industry accepted measures in
  tabular format with reconciliation to the closest equivalent GAAP measure.74
  Glossary of Technical Terms
  Explanation of terminology used in our MD&A that is unique to the mining
  industry.  26


Core
Business and Market Overview  Core
Business  We are the worlds
largest gold mining company in terms of market capitalization, annual gold
production and gold reserves. We also hold interests in two copper mines and a
number of copper projects, a nickel project and two platinum group metals
projects. We presently generate revenue and cash flow from the production and
sale of gold and copper. We sell our production in the world market through
three primary distribution channels: gold bullion is sold in the gold spot
market; gold and copper concentrate is sold to independent smelting companies;
and copper cathode is sold under copper cathode sales contracts between
ourselves and various third parties.  Barrick has grown through a combination of organic growth, with new
mineral reserve discoveries, and also through acquisitions. In 2006, we
acquired Placer Dome, one of the worlds largest gold mining companies. In
2007, we continued to expand the gold industrys deepest project pipeline
through the acquisition of a 51% interest in the Cerro Casale copper-gold
deposit in Chile, through our acquisition of Arizona Star Resources Corp., and
highly prospective exploration licenses and the Kainantu Gold mine from
Highlands Pacific. We also increased our interest in the Porgera mine from 75%
to 95%. In February 2008, we entered into a definitive agreement to
increase our ownership in the Cortez mine and the Cortez Hills project from 60%
to 100%.    Our project pipeline, funded mainly by reinvestment of cash flow from
current operations into exploration and projects, is the key to our long term
goal of increasing profitability and building shareholder value. Our
profitability is dependent upon our ability to effectively manage and contain
total cash costs both at our current operating mines and our next generation of
mines. We expect that our next generation of mines, including Buzwagi, Cortez
Hills, Pueblo Viejo and Pascua-Lama, should operate at lower average total cash
costs than the average total cash costs of our current portfolio of operating
mines. The projects in our pipeline are at various stages of development,
ranging from scoping to feasibility to construction. We are confident that we
have the managerial team and resources to successfully bring these projects
into production. These projects will require substantial upfront capital that
we expect to fund from a combination of operating cash flow and new financings.
We expect the contribution from these new mines to improve our cash margins
from gold, and thereby drive operating cash flow and long-term shareholder
value.  In 2007, we saw expansion of gold cash margins as gold price increases
more than offset cost increases. The gold mining industry is facing cost
pressures from factors such as higher labor costs, higher energy costs and
commodity prices, higher gold price related costs, and a weakening US dollar.
We believe that we have been successful in mitigating the impact of cost
pressures and we met our original guidance for total cash costs in 2007.  In fourth quarter 2007, higher market gold prices drove significantly
higher earnings and operating cash flow. We believe that Barrick is well
positioned to benefit from the present high gold price environment.  27


Market
Overview  The success of a global mining company such as Barrick continues to be
driven by global demand for the commodities we produce. In 2007, the trend of
higher gold and silver prices continued for the quarter. Copper prices also
remained at historically high levels.  Mineral Markets  Gold  The market price of gold is one of the most significant factors in
determining the profitability of Barricks operations. The price of gold is
subject to volatile price movements over short periods of time, and is affected
by numerous industry and macroeconomic factors that are beyond our control. In
2007, gold prices ranged from $608 to $841 per ounce with an average market
price of $695 per ounce and closed the year at $834 per ounce. In early 2008,
the gold price has traded upwards at an all-time record high of over $900 per
ounce.  The price of gold has traded strongly since
the fall of 2007, largely in reaction to the economic uncertainty in response
to the contraction of global credit markets, interest rate cuts, increased risk
and volatility across asset classes, continued strong investment demand,
inflation expectations and political unrest. Those trends and expected further
US dollar depreciation are supportive of higher gold prices in 2008.  We believe the outlook for mine production from all gold mining
companies in the medium to long term, which currently represents over 60% of
total global supply, is one of gradual decline over the next 510 years. The
primary drivers for the global decline are increased difficulty in permitting
new projects, high capital costs, scarcity of experienced labor, and lack of
new discoveries in the last decade. A decrease in global industry production
should be positive for long-term gold prices.    With the elimination
of our corporate gold sales contract position in the first half of 2007, our
operating mines are selling all production at market gold prices.  28


Copper  LME copper prices
traded in a range of $2.37  $3.77 per pound in 2007, and averaged $3.23 per
pound for the year. Our realized price of $3.19 in 2007 tracked LME spot
prices. In early 2007, prices declined on concerns about reduced demand from
the US and rising inventories. However, continued strong demand from Asia
supported prices and labor disruptions limited supply for short periods of
time, resulting in price volatility. Future copper prices are expected to be
influenced by demand from Asia, global economic performance and production levels
of mines and smelters. We are fully hedged for our 2008 copper production, with
a weighted average floor price of $3.03/lb. 25% of our hedge contracts
(approximately 100 million pounds) are capped at $3.50/lb, through our
copper-denominated notes, whereas the balance (approximately 300 million
pounds) has upside participation to an average price of $3.92/lb.  Currency
Exchange Rates  Results of our
mining operations outside the United States, reported in US dollars, are
affected by currency exchange rates. The largest single exposure we have is to
the Australian dollar. We also have significant exposure to the Canadian dollar
through a combination of Canadian mine operating costs and corporate
administration costs.    A weaker US dollar
causes our costs reported in US dollars to increase, subject to protection we
have put in place through our currency hedging program. In 2007, the Canadian
dollar traded to its highest level against the US dollar in over 50 years due
to high energy and base metals prices, investment flows from M&A activity
and the continued out-performance of the Canadian economy relative to the US.
The Australian dollar has also appreciated, largely due to higher commodity
prices, strong economic performance and higher interest rates relative to the
US.  About 6065% of our consolidated production costs are denominated in US
dollars and are not exposed to fluctuations in US dollar exchange rates. For
the remaining portion, our currency hedge position has mitigated, to a
significant extent, the effect of the weakening of the US dollar over the last
few years on operating costs at our Australian and Canadian mines. Over the
last three years, our currency hedge position has provided benefits to us in
the form of hedge gains when contract exchange rates are compared to prevailing
market exchange rates as follows: 2007  $166 million; 2006  $84 million; and
2005  $100 million. These gains are recorded within our operating costs. We
have also recorded hedge gains as an offset to corporate administration costs
as follows: 2007  $19 million; 2006  $14 million; 2005  $16 million.  29


Our currency hedge position at the end of 2007 provides protection for
a significant portion of our Canadian and Australian dollar-based costs. The
average hedge rates vary depending on when the contracts were put in place. For
hedges in place for future years, average hedge rates are higher than 2007
because some of the contracts were added over time as the US dollar weakened.
We are fully hedged in 2008 for expected Australian and Canadian operating
expenditures at rates of 0.78 and 0.86, respectively. In addition, we have
fully hedged expected 2009 Australian and Canadian operating expenditures at
rates of 0.78 and 0.93, respectively. We do not expect any further appreciation
of either the Australian or Canadian dollars to have a significant impact on
our 2008 or 2009 operating costs. Beyond the next two years, our Canadian
dollar-based costs principally represent corporate administration costs at our
head office, and the portion of the Australian dollar-based costs that remain
unhedged is subject to market currency exchange rates. Further information on
our currency hedge positions is included in note 20 to the Financial Statements.  Fuel    We consume on
average about 3.5 million barrels of diesel fuel annually across all our mines.
Diesel fuel is refined from crude oil and is therefore subject to the same
price volatility affecting crude oil prices. With global demand remaining high
in 2007, oil prices rose from $61 per barrel at the start of the year to a
record high $99 per barrel in November 2007, closing at $96 per barrel at
the end of the year. We have a fuel hedge position to mitigate rising oil
prices and control the cost of fuel consumption totaling 5.2 million barrels,
which represents about 48% of our total estimated consumption in 2008 and 24%
of our total estimated consumption in each of the following five years. The
fuel hedge contracts are primarily designated for our Nevada-based mines, and
have an average price of $76 per barrel. In 2007, we realized benefits in the
form of fuel hedge gains totaling $29 million (2006: $16 million; 2005: $10
million), when fuel hedge prices were compared to market prices. These gains
are recorded in our operating costs.  Electricity  We purchase about
36 billion kilowatt hours (kwh) of electricity annually across all our mines.
Electricity costs represent approximately 35% of our total energy spend to
produce gold and copper. We typically buy electricity from regional power
utilities, but at some mines we generate our own power. Fluctuations in
electricity prices are generally caused by local economic and regulatory
factors. Electricity prices have generally been rising in recent years due to
increases in the price of diesel fuel, coal and natural gas, which are used by
many power generators, as well as increasing demand for electricity. Based on
estimates of our 2008 electricity requirements, a 10% increase in the price for
electricity would result in an increase in our annual cost of electricity
consumed of about $28 million, or $4 per ounce.  30


US Dollar Interest Rates    As a result of the
contraction of global credit markets, the US Federal Reserve reduced short-term
US dollar interest rates in the latter half of 2007. The expected trend for
2008 is for further reductions to the short-term rate in order to help
alleviate the sub-prime crisis and stimulate economic activity. Volatility in
interest rates mainly affects interest receipts on our cash balances ($2.2
billion at the end of 2007), and interest payments on variable-rate debt
(approximately $586 million at the end of 2007). The relative amounts of
variable-rate financial assets and liabilities may change in the future,
depending upon the amount of operating cash flow we generate, as well as
amounts invested in capital expenditures.  Enterprise Strategy and
our Ability to Deliver Results  Our Vision  To be the worlds best
gold mining company by finding, acquiring, developing and producing quality
reserves in a safe, profitable and socially responsible manner.  Our Strategy  To increase total
returns for Barrick shareholders, we reinvest cash flow from our mines in exploration
and development projects to sustain and grow our business. We aim to increase
earnings and operating cash flow, and to provide leverage to gold prices,
through annual gold production and growing of our reserve/resource base. It can
take a number of years for a project to move from the exploration stage through
to mine construction and production. Our business strategy reflects this long
lead time by ensuring that we have a deep project pipeline combined with
effective management of current operating mines.  In 2006, we set our 2007 strategic and financial performance targets.
Our strategic targets focused on share price performance, creating a high
performance organization, responsible mining, advancing our project pipeline,
meeting our financial and operating targets focused on core areas of
production, cost control, and increasing reserves. Our successes in each of
these areas have laid the foundation for our 2008 key areas of focus: share
price performance, responsible mining and operational excellence, further
advancing our projects, building and maintaining a high performance
organization.  31


Key Strategic Performance  2007 Strategic Objectives
  
  Performance
  
  Key 2008 Strategic ObjectivesShare Price Performance
  ·  Grow the business through a combination of
  opportunistic acquisitions, new deposit discoveries and replacement of
  reserves and resources
  ·  Advance
  project pipeline through achievement of milestones, prioritization and
  effective sequencing
  ·  Strong
  financial management, including hedge book management, balance sheet
  optimization and realizing Placer Dome acquisition synergies
  ·  Operational
  excellence focused on meeting production and cost targets, realizing savings
  from ongoing continuous improvement initiatives, and increased focus on
  R&D
  ·  Advance
  opportunities for vertical integration and effective consumables management
  ·  Effective
  capital management through prioritization, capital allocation and value
  measurement
  
  ·  Met
  original guidance for production and total cash costs
  ·  Key
  acquisitions with additional 20% of the Porgera mine, purchase of Highlands
  Pacific in Papua New Guinea and a 51% interest the in Cerro Casale
  copper-gold deposit in Chile through Arizona Star
  ·  Advanced
  our project pipeline with construction started at Buzwagi feasibility studies
  finalized for Donlin Creek and updated for Pueblo Viejo. Restructured our
  joint venture agreement for Donlin Creek
  ·  Made
  a new discovery, Monte Oculto, at Pueblo Viejo project in the Dominican
  Republic
  ·  Improved
  design and enhanced mineral recovery at our new projects
  ·  Launched
  Unlock the Value program
  ·  Placer
  Dome acquisition synergy targets met
  ·  The
  Barrick share price rose significantly through the end of 2007 and into early
  2008, outperforming other senior gold producers
  
  Operational
  Excellence
  ·  Meet
  guidance for production and total cash costs
  ·  Excellent
  financial management in areas of financial risk management, financial
  reporting, cost control and investor communications
  Growth
  ·  Continue
  to focus on exploration to find new reserves and resources
  ·  Expanding
  the role of R&D to add value to our existing operations
  ·  Targeted
  acquisitions to strengthen operational base and complement pipeline
  Capital Management and Projects
  ·  Effective
  capital allocation through prioritization and sequencing of projects
  ·  Projects
  built on-time and on-budget through Barrick Development System
  ·  Address
  long-term energy needs and explore alternative energy projectsHigh Performance Organization
  ·  Leadership
  development
  ·  Optimization
  of business processes such as planning, project management and risk
  management
  ·  Technology
  improvements to increase automation and control costs
  ·  Compliance
  with business code of conduct and applicable corporate governance legislation
  
  ·  Lower
  employee turnover rate in targeted locations
  ·  Launched
  the Powerful Leadership training program worldwide to improve leadership and
  culture
  ·  Launched
  Business Process Improvement program and commenced rollout of standardized
  technology solutions and business processes across the company
  ·  Conducted
  Ethics and Integrity seminars for leaders across the organization
  ·  Compliance
  with our Code of Business Conduct and Ethics, SOX and other regulations
  
  High
  Performance Organization
  ·  Strengthen
  Leadership through sustained training and support for our people
  ·  Continue
  building culture focused on our values, innovation and open communication
  ·  Enhanced
  people management to be the employer of choice by attracting, motivating and
  retaining top people in competitive markets
  ·  Support
  the business by developing robust infrastructure, standardizing and
  streamlining business processesResponsible Mining
  ·  Achieve
  safety and health performance targets
  ·  Effective
  government relations and community engagement
  ·  Environmental
  leadership through energy and conservation strategy
  
  ·  Improved
  our safety record with fewer lost-time and total incidents. No employee
  fatalities; however, we had two contractor fatalities
  ·  Over
  21,000 people trained in Courageous Safety Leadership to date
  ·  Included
  in the annual Dow Jones Sustainability Index North America for the first
  time, ranking best-in-class for our ongoing commitment to sustainability
  ·  Lagunas
  Norte and Pierina certified under the International Cyanide Management Code
  joining Cowal, Goldstrike, Round Mountain and Marigold which are all
  certified. In January, Cortez and Bald Mountain mines in Nevada became the
  latest mines certified
  ·  Veladero
  achieved ISO 14001 certification for environmental management system. All of
  Barricks producing operations in South America now certified
  ·  Started
  alternative power projects in Tanzania, Chile and Argentina
  
  Responsible Mining
  ·  Effective
  community and government relations that work to strengthen relationships with
  the communities around our operations
  ·  Environmental
  leadership on climate change, water management, energy management and International
  Cyanide Management Code implementation
  Innovation
  ·  Focus
  on innovation, through R&D efforts, to increase recovery, improve ore
  characterization, reduce energy requirements and improve plant design
  ·  Using
  technology as an enabler to develop strategy, increase automation and remote
  management at our mines  32


Capability
to Execute our Strategy  Our capability to
execute our financial and operational strategy comes from the strength of our
regional business unit structure, our experienced management team and a strong
project pipeline that facilitates long-term sustainability of our business.  Regional
Business Unit Structure  We manage our
business using a regional business unit (RBU) structure. We have four RBUs:
North America, South America, Australia Pacific and Africa. Each region
receives direction from the Corporate Office, but has responsibility for all
aspects of its business such as strategy and sustainability of its portfolio of
operating mines, including exploration, production and closure. Each team is
led by its own Regional President, with oversight by the Corporate Office. Each
region has two overriding responsibilities: to optimize current assets and to
grow its business.  Each RBU operates as a standalone business unit with a range of
functional groups. Since their inception, the RBUs have added significant value
to our business by realizing operational efficiencies in the region, allocating
resources more effectively and understanding and better managing the local
business environment, including labor, consumable costs and supply and
government and community relations. In a period of inflationary cost pressures
experienced by the mining industry, we believe that our RBU structure has allowed
us to better deal with the challenges and issues impacting our industry.  Experienced
Management Team and Skilled Workforce  We have an
experienced management team with a proven track record in the mining industry.
Strong leadership and governance are critical to the successful implementation
of our core strategies. We continue to focus on leadership development for key
members of our executive team, senior mine management and frontline management.
A skilled workforce has a significant impact on the efficiency and
effectiveness of our operations. The remote nature of many of our mine sites,
as well as strong competition for human resources, presents challenges in
maintaining a well-trained and skilled workforce. We continue to focus our
efforts on employee retention, recruiting skilled employees and positive labor
relations, including training programs, leadership development and succession
planning. In 2007, using data from the global HR information system implemented
in 2006 and growth projections for the next 5 years, we built a workforce plan
to help us anticipate future recruiting and development needs.  Our Engineers-in-Training program continues to mature. The program is
aimed at developing skilled personnel to mitigate the risk of future staff shortages.
The program has grown to 150 globally (primarily in the Mining, Metallurgy &
Geology disciplines) which is implemented regionally and managed by the
Corporate office.  Advanced
Exploration and Project Pipeline  Our pipeline of
advanced exploration targets and projects represents a critical component of
our long-term strategy of growing our business. We and others in the mining
industry face the challenges associated with finding, acquiring and developing
projects. An economic discovery is no longer a guarantee of a new mine, as
considerable opposition to new mining projects can develop from institutional
NGOs or unstable political climates. The development of a new mine requires
successful permitting and government relations, community dialogue and
engagement, and significant financial and human capital. In response to these
challenges, we have a specialist group that manages our project pipeline and
can draw on our considerable company-wide resources and experience to enhance
our prospects for success; however, the time-line and cost of developing
projects has increased significantly.  During 2007, the capacity of the organization to execute projects was
expanded through the addition of experienced staff with the necessary
specialized skill set associated with project management. Efforts in this
regard will continue in 2008 with a number of positions identified to be added
to enhance the Companys capacity to deliver on the significant project
pipeline in the coming years.  33


Technology
and Business Process  Progress was made
during the year to standardize and improve technology solutions and business
processes. Future benefits from standardization and expanded visibility should
result in improved efficiency. We expect that these improvements will allow us
to more easily identify value-creating opportunities in existing operating
sites and projects through better information sharing and the ability to
benchmark operating activities and implement best practices across our
operations.  Technical innovation is also being pursued, utilizing our in-house
Technology Center where we conduct some of our research and development (R&D)
activities along with the development of other metallurgical optimization initiatives.
Certain of our projects have realized benefits as a result of this R&D
work, which has produced modified process designs that yield enhanced gold and
metal by-product recoveries. The success of this program resulted in the
decision to expand the facility as internal demand for support was beyond the
capacity of the existing facility. Examples of the benefits realized from the
work at the lab include changes in metallurgical process design at Pueblo Viejo
and Donlin Creek which enhanced gold recoveries and/or non-gold revenue streams
and reduced neutralization costs, which we expect will have a positive impact
on project economics.  Our Information Management and Technology (IMT) group provides focused
and responsive support to enable us to meet our current business objectives and
long-term strategy elements. Our key areas of focus are the delivery of the
technology solutions to support the benefits of business process reengineering
and standardization; the use of established best practice technology solutions
to automate business operations for increased safety, productivity and reduced
costs; and an architected approach to the delivery of timely and accurate
information to decision makers at all levels in the organization.  Supply
Chain Management  In 2007, we
continued our emphasis on cost control and supply security. Long-term contracts
with guaranteed supply and defined costs were executed for critical supplies,
including tires, and some other contracts were renegotiated to lower costs. Our
continuing focus on commodity management has enabled us to better define our
requirements and manage costs, both for ongoing operations and development
projects.  On January 30, 2008, as part of this strategy, we announced a $200
million 10-year agreement with Yokohama Rubber Co. to secure a supply of tires,
which are a critical component for mining and one of our largest single
procurement expenses. Worldwide demand for tires, due to the expansion in the
mining and construction industries, has resulted in rising prices and tire
shortages. This agreement secures a supply of high quality tires for our
operations at direct-from-manufacturer prices.  In 2008, we plan to extend our commodity team approach to key items
that may not be in short supply, but which represent major elements of cost. A
key component will be the use of our global buying power to attract competitive
interest and obtain best value. Examination of low-cost country sources will
continue, and these will be pursued where they represent lowest total cost of
ownership  particularly to reduce capital costs at our projects.  Maintenance
and Equipment Availability  Maintenance costs
represent about 20% of our total cash costs and an effective maintenance
program helps ensure a cost effective program with optimal equipment
utilization. In 2007, our maintenance group focused on developing standardized
policies, procedures and processes for asset management. The global enterprise
asset management system (Oracle) continued to be rolled out with implementation
occurring in Australia. Implementation will continue in Australia and Africa in
2008 and beyond.  Formal regional maintenance networks were developed and implemented and
enabled the sharing and resolution of common issues and ideas. The networks are
comprised of the senior maintenance leaders from each site in their respective
region who meet regularly to discuss and agree on ways of improving maintenance
productivity and performance.  Continuous
Improvement  Our Continuous
Improvement (CI) groups vision is to achieve operational excellence and a
company culture that engages every employee in improvement every day. We have a
global network of Barrick employees across all sites that focus on CI in all
key  34


aspects of our
business. Structured problem solving and planning methodologies are used
extensively to help identify and execute improvement initiatives while
fostering Company-wide learning through knowledge-sharing. Implementation of CI
initiatives has led to significant value creation for Barrick in terms of cost
mitigation, throughput increases and quality improvements.  A major focus for the global CI group in 2007 was the targeted
identification of cash cost improvements to offset inflationary cost pressure,
a key component of our share price performance objective. Further training and
collaboration with key partners in supply chain allowed us to expand the depth
and scope of our operations improvements. In sharing our continuous
improvement tools, such as value stream mapping, we were able to reduce the
cycle times by these selected supply partners as well as significantly improve
their on-time delivery performance to our mine sites. A new Best Practices
system was introduced to enable the evaluation and global sharing of best
practices, allowing rapid adoption of business performance improvement ideas
and methods that drive more value and learning throughout the organization.  Environmental,
Health and Safety  Responsible mining
is one of our key strategic objectives. It is integral to all our activities as
we find, develop and produce gold on a global basis. Our Environmental, Health,
Safety and Sustainability Executive Committee is responsible for monitoring and
reviewing environmental, safety and health policies and programs, assessing
performance and monitoring current and future regulatory issues.  As part of our commitment to responsible mining, we focus on
continuously improving health and safety programs, systems and resources to
help control workplace hazards and eliminate injuries. Continuous monitoring
and integration of health and safety into decision-making enables us to operate
effectively, while also focusing on health and safety. We introduced the
Barrick Health System globally in 2007 and began site-level gap analysis
against the Health System standards at our operations.  Courageous Safety Leadership training was first introduced to employees
and contractors in 2004, and we have continued to provide this training
annually. In 2007, we offered Courageous Safety Leadership refresher courses to
all employees and most contractors, as well as one and two-day courses to new
employees and contractors.  We are a charter signatory to the International Cyanide Management
Code. In March 2006, our Cowal mine became the first facility in the world
to obtain the International Cyanide Management Institute Certification. At the
end of 2007, seven of our mines had been certified as Code compliant and the
remaining mines which use cyanide are preparing for the certification process.
We are a signatory to the UN Global Compact, which encourages businesses to
support a precautionary approach to environmental challenges, undertake
initiatives to promote greater environmental responsibility and encourage the
development and diffusion of environmentally friendly technologies.  35


2007
Financial Results  2007
Financial Overview  Summary
of Key Financial Results  ($ millions, except per share, per ounce/pound data in dollars)
  For the years ended December 31
  
  2007
  
  2006
  
  2005Net income
  
  $
  1,119
  
  $
  1,506
  
  $
  401Per share(1)
  
  1.29
  
  1.79
  
  0.75Adjusted net income from continuing
  operations(2)
  
  1,733
  
  1,561
  
  450Per share
  
  2.00
  
  1.86
  
  0.84EBITDA from continuing operations(3)
  
  2,427
  
  2,308
  
  847Per share
  
  2.80
  
  2.74
  
  1.58Adjusted EBITDA from continuing
  operations(3)
  
  3,063
  
  2,675
  
  903Per share
  
  3.53
  
  3.18
  
  1.68Operating cash flow
  
  1,732
  
  2,122
  
  726Per share
  
  2.00
  
  2.52
  
  1.35Adjusted operating cash flow(4)
  
  2,368
  
  2,489
  
  782Per share
  
  2.73
  
  2.96
  
  1.45Total assets
  
  21,951
  
  21,510
  
  6,929Total liabilities
  
  $
  6,613
  
  $
  7,255
  
  $
  3,079  
 (1)Calculated
using net income and weighted average number of shares outstanding.  (2)Excluding
the impact of deliveries into Corporate Gold Sales Contracts. Adjusted net
income from continuing operations is an operating performance measure with no
standardized meaning under GAAP. For further information, please see page 69.  (3)Adjusted
net income from continuing operations excluding income tax expense, interest
expense, interest income and amortization. Adjusted EBITDA from continuing
operations excludes the impact of deliveries into Corporate Gold Sales
Contracts, and is an operating performance measure with no standardized meaning
under GAAP. For further information, please see page 70.  (4)Excluding
the impact of deliveries into Corporate Gold Sales Contracts. Adjusted
operating cash flow is an operating performance measure with no standardized
meaning under GAAP. For further information, please see page 69.  Key
Factors Affecting Adjusted Net Income from Continuing Operations(1)    
 (1)Adjusted net income excludes
the impact of deliveries into our Corporate Gold Sales Contracts.  In 2007, we
reported net income of $1,119 million, compared to $1,506 million in 2006.
Adjusted net income from continuing operations was $1,733 million, 11% higher
than the prior year period, as higher per ounce margins on gold and copper and
a year to date increase in copper sales volumes were partially offset by lower
gold sales volumes, higher amortization and higher exploration and development
costs.  36


Special
Items  Effect on Income Increase (Decrease)  Refer to
  
  2007
  
  2006
  
  2005($ millions)
  
  page
  
  Pre-tax
  
  Post-tax
  
  Pre-tax
  
  Post-tax
  
  Pre-tax
  
  Post-taxGain on sale
  of South Deep
  
  
  
  $
  
  
  $
  
  
  $
  288
  
  $
  288
  
  $
  
  
  $
  Opportunity cost of deliveries into
  Corporate Gold Sales Contracts
  
  38
  
  (636
  )
  (623
  )
  (367
  )
  (352
  )
  (56
  )
  (55
  )Tanzanian tax valuation allowance release
  
  49
  
  156
  
  156
  
  
  
  
  
  
  
  Impact of change of enacted rates in Canada
  
  50
  
  (64
  )
  (64
  )
  (12
  )
  (12
  )
  
  
  Impairment charges
  
  49
  
  (62
  )
  (59
  )
  (23
  )
  (18
  )
  (16
  )
  (16
  )Highland
  equity gain/(loss)
  
  
  
  (20
  )
  (20
  )
  51
  
  51
  
  
  
  Gains on
  sale of Gold Fields and NovaGold shares
  
  
  
  52
  
  37
  
  
  
  
  
  
  
  Unrealized
  gold and copper non-hedge derivative gains
  
  
  
  28
  
  19
  
  
  
  29
  
  6
  
  4Deferred tax
  credits
  
  
  
  
  
  
  
  
  
  31
  
  
  
  5Total
  
  
  
  $
  (546
  )
  $
  (554
  )
  $
  (63
  )
  $
  17
  
  $
  (66
  )
  $
  (62
  )  Summary
of Key Operational Statistics  Gold
  
  Copper(1)($ millions, except per share, per ounce/pound data in dollars)
  
  2007
  
  2006
  
  2005
  
  2007
  
  2006Production(000s oz/millions lbs)(1),(2)
  
  8,060
  
  8,643
  
  5,460
  
  402
  
  367Reserves(millions of contained ounces/billions of contained
  pounds)(3)
  
  124.6
  
  123.1
  
  88.6
  
  6.2
  
  6.0Sales(4)000s oz/millions lbs
  
  8,055
  
  8,390
  
  5,320
  
  401
  
  376$ millions
  
  $
  5,027
  
  $
  4,493
  
  $
  2,348
  
  $
  1,305
  
  $
  1,137Market price(5)
  
  695
  
  604
  
  444
  
  3.23
  
  3.05Realized price(5),(6)
  
  619
  
  543
  
  439
  
  3.19
  
  3.06Total cash costs(5),(7)
  
  350
  
  283
  
  224
  
  0.83
  
  0.79Amortization(5)
  
  104
  
  82
  
  76
  
  0.32
  
  0.43Total production costs(5)
  
  $
  454
  
  $
  365
  
  $
  300
  
  $
  1.15
  
  $
  1.22  
 (1)
  
  The 2005 comparative period for copper has been
  omitted as we did not produce a significant amount of copper prior to the
  acquisition of Placer Dome.(2)
  
  Gold production reflects our equity share of
  production, including our equity share of production from the South Deep mine
  sold in 2006. Gold production also includes an additional 20% share of
  production from the Porgera mine from April 1, 2007 onwards.(3)
  
  Calculated in accordance with National Instrument
  43-101 as required by Canadian securities regulatory authorities. For United
  States reporting purposes, Industry Guide 7, (under the Securities and
  Exchange Act of 1934), as interpreted by Staff of the SEC, applies different
  standards in order to classify mineralization as a reserve. Accordingly, for
  U.S. reporting purposes, Pueblo Viejo is classified as mineralized material.
  For a breakdown of reserves and resources by category and additional
  information relating to reserves and resources, see pages 136 to 144.(4)
  
  Gold sales ($millions) exclude the results of
  discontinued operations. Gold sales (000s oz) exclude the results of
  discontinued operations and reflect our equity share of sales.(5)
  
  Per ounce/pound weighted average. For further
  information, please see page 71.(6)
  
  Realized prices exclude unrealized non-hedge
  derivative gains and losses, and are an operating performance measure that is
  used throughout this MD&A. For more information see page 71.(7)
  
  Total cash costs per ounce/pound statistics exclude
  amortization and inventory purchase accounting adjustments. Total cash costs
  per ounce/pound is an operating performance measure that is used throughout
  this MD&A. For further information, please see pages 71 to 73.  37


Realized gold prices of
$619 per ounce in 2007 were 14% higher than in 2006, principally due to higher
market gold prices. Realized gold prices in 2007 reflect a reduction of $636
million (2006: $367 million), or $76 per ounce (2006: $44 per ounce), due to
the voluntary delivery of 2.5 million ounces (2006: 1.2 million) into Corporate
Gold Sales Contracts at average prices below the prevailing spot price,
eliminating our Corporate Gold Sales Contracts. Our portfolio of operating
mines is now fully leveraged to market gold prices.  Realized copper
prices in 2007 were slightly higher than in 2006, with variability quarter to
quarter reflecting the variability of market prices.  Cash margins for
gold have been increasing over the past three years as higher market gold
prices have more than offset increases in total cash costs. Assuming an average
spot gold price of $900 dollars per ounce in 2008, we would expect to realize
cash margins of about $500 per ounce.    
 (1)Amounts
represent cash margins on both spot price and realized price. Cash margins on
spot prices reflect margins excluding deliveries to eliminate Corporate Gold
Sales Contracts.  Cost of
Sales/Total Cash Costs  Gold  in millions
  
  per ounceFor the years ended December 31
  
  2007
  
  2006
  
  2005
  
  2007
  
  2006
  
  2005Cost of goods sold(1),(2),(3)
  
  $
  2,890
  
  $
  2,388
  
  $
  1,357
  
  $
  359
  
  $
  286
  
  $
  255Currency/commodity hedge gains
  
  (195
  )
  (100
  )
  (126
  )
  (24
  )
  (12
  )
  (24
  )By-product credits
  
  (105
  )
  (123
  )
  (132
  )
  (13
  )
  (15
  )
  (25
  )Royalties/production taxes
  
  190
  
  179
  
  81
  
  23
  
  21
  
  16Accretion/other costs
  
  37
  
  28
  
  11
  
  5
  
  3
  
  2Cost of sales/Total cash costs(1)
  
  $
  2,819
  
  $
  2,372
  
  $
  1,191
  
  $
  350
  
  $
  283
  
  $
  224  
 (1)
  
  Total cash costs and cost of sales both exclude
  amortization and inventory purchase accounting adjustments  see
  pages 71 to 73.(2)
  
  Excludes cost of sales related to discontinued
  operations and non-controlling interests.(3)
  
  At market currency exchange and commodity rates,
  adjusted for non-controlling interest  see pages 71 to 73.  Total production costs in
2007 were $454 per ounce, an increase of $89 compared to the prior year period,
due to higher cash costs and amortization expense.  Total cash costs per
ounce for 2007 were up $67 per ounce compared to the prior year. Total cash
costs were impacted by 22% lower average head grades and continued waste
stripping activities, exchange rate fluctuations, inflationary pressures with
respect to labor, oil and other consumables, and increases in royalties and
production taxes and other gold price linked costs, the weaker US dollar and inflationary
cost pressures.  2007
Operational Overview  Gold  For the years ended
  December 31
  
  2007
  
  2006
  
  % Change
  
  2005Tons mined(000s)
  
  653
  
  600
  
  9
  %
  359Ore tons processed(000s)
  
  172
  
  157
  
  10
  %
  98Average grade(ozs/ton)
  
  0.052
  
  0.067
  
  (22
  )%
  0.069Gold produced(000s/oz)
  
  8,060
  
  8,643
  
  (7
  )%
  5,460  Gold Production in 2007
was 583 thousand ounces or 7% lower than in 2006, reflecting lower production
in Africa, North America, and Australia.  38


Tons
Mined and Tons Processed    
 (1)All
amounts presented are based on equity production.  Total
tons mined and tons processed were up 9% and 10%, respectively, compared to
2006. The higher tons mined and tons processed result from a combination of the
start-up of Cowal in mid-2006 and Ruby Hill in early 2007, increased waste
stripping activity at certain of our mines, mine sequencing, mine expansion and
productivity improvements at our existing mines.  Average Mill Head Grades    
 (1)All
amounts presented based on equity production. Average mill head grades are
expressed as the number of ounces of gold contained in a ton of ore processed.
Reserve grade represents expected grade over the life of the mine and is
calculated based on reserves reported at the end of the immediately preceding
year.  Average
mill head grades decreased by approximately 22% in 2007 compared to the prior
year primarily due to mine sequencing that resulted in lower ore grades at
certain of our mines. We were mining below our average reserve grade in 2007
and we expect average mill head grades to head back towards reserve grade over
the next few years. We have taken advantage of the high gold price environment
to process material that would otherwise be uneconomical in a lower gold price
environment, earning an operational contribution from low-grade material that
would otherwise be classified as waste, which has had an impact on average ore
grades processed.  39


Reserves(1)  At
the end of 2007, we had proven and probable gold reserves of 124.6 million
ounces, an increase of 1.5 million ounces from the prior year, based on a $575
per ounce gold price. We also increased gold mineral resources (measured and
indicated) by 15.6 million ounces to 50.6 million ounces, and inferred
resources by 7.0 million ounces to 31.9 million ounces, based on a $650 per
ounce gold price. Reserves and resources do not include the Companys recently
acquired interest in Cerro Casale due to insufficient time, after our
acquisition in December 2007, to complete the work necessary to
incorporate this deposit in year-end results. Reserves and measured and
indicated resources would increase by 4.6 million ounces and 1.4 million ounces
respectively, on closing of the transaction to increase our ownership interest
in Cortez from 60% to 100%.  We increased proven and probable copper reserves by 0.2 billion pounds
to 6.2 billion pounds, with an additional 5.4 billion pounds of measured and
indicated resources at year end.  Copper contained in our gold reserves at year end 2007 was 1.5 billion
pounds. Silver contained in our gold reserves at year end 2007 was 1.0 billion
ounces, primarily at the Pascua-Lama project, one of the largest silver
deposits in the world, which contains 731 million ounces of silver contained in
gold reserves.  Replacing gold and copper reserves depleted by production year over
year is necessary in order to maintain production levels over the long term. If
depletion of reserves exceeds discoveries over the long term, then we may not
be able to sustain gold and copper production levels. Reserves can be replaced
by expanding known ore bodies, acquiring mines or properties or discovering new
deposits. Once a site with gold or copper mineralization is discovered, it
takes several years from the initial phases of drilling until production is
possible, during which time the economic feasibility of production may change.
Substantial expenditures are required to establish proven and probable reserves
and to permit and construct mining and processing facilities.  
 (1)For a
breakdown of reserves and resources by category and additional information
relating to reserves and resources, see pages 136 to 144 of this Financial
Report 2007.  Key Business
Transactions  Acquisition of Arizona Star  In fourth quarter 2007, we
acquired over 94% of the outstanding shares, on a fully diluted basis, of
Arizona Star Resources Corp., which owns a 51% interest in the Cerro Casale
deposit in the Maricunga district of Region III in Chile, for $722 million in
cash. We expect to complete the acquisition in the first quarter 2008. Kinross
Gold Corporation owns the remaining 49%. Cerro Casale is one of the the worlds
largest undeveloped gold and copper deposits.  Acquisition of 40% Interest in Cortez  In
February 2008, our subsidiary, Barrick Gold Finance Inc., entered into a
definitive purchase agreement with Kennecott Explorations (Australia) Ltd., a
subsidiary of Rio Tinto plc (Rio Tinto) to acquire its 40% interest in the
Cortez property for $1.695 billion in cash consideration, due on closing, with
a further $50 million payable if and when we add an additional 12 million
ounces of contained gold resources to our December 31, 2007 reserve
statement for Cortez. A sliding scale royalty is payable to Rio Tinto on 40% of
all production in excess of 15 million ounces on and after January 1,
2008. The acquisition will consolidate 100% ownership for Barrick of the
existing Cortez mine and the Cortez Hills development project plus any future
potential from the property, which is located on one of the worlds most
prospective gold trends. We expect to fund the purchase price through a
combination of our existing cash balances and by drawing down our line of
credit. The agreement is subject to the normal and customary closing conditions
and is expected to close in the first quarter of 2008.  40


Other Acquisitions  In
fourth quarter 2007, we acquired over 2,900 square kilometers of highly
prospective exploration licenses and the Kainantu gold mine in Papua New Guinea
from Highlands Pacific Limited for $135 million in cash, net of $7 million held
back pending renewal of exploration licenses. With this acquisition, we will
have access to over 5,300 square kilometers of contiguous ground for
exploration in one of the worlds most highly endowed gold and copper regions
that includes our world class Porgera mine.  In third quarter 2007, we increased our interest in the Porgera mine from
75% to 95% for $259 million in cash. The Government of Papua New Guinea holds
the remaining 5% interest.  Operating
Segments Review  We
report our results of operations using a geographical business unit approach:
North America, South America, Australia Pacific and Africa. This structure
reflects how we manage our business and how we classify our operations for
planning and measuring performance.  In our Financial Statements, we present a measure of historical segment
income that reflects gold sales and copper sales at average consolidated
realized gold and copper prices, respectively, less segment expenses and
amortization of segment property, plant and equipment. We monitor segment
expenses using total cash costs per ounce statistics that represent segment
cost of sales divided by ounces of gold, pounds of copper sold or tons
processed in each period. The discussion of results for producing mines focuses
on this statistic to explain changes in segment expenses.  Regional Production and Total Cash Costs  Production
  (000s ozs/millions lbs)
  
  Total cash costs
  ($ per oz/lb)Year ended December 31
  
  2007
  
  2006
  
  2005
  
  2007
  
  2006
  
  2005GoldNorth America
  
  3,201
  
  3,372
  
  2,863
  
  $
  370
  
  $
  314
  
  $
  244South America
  
  2,079
  
  2,104
  
  1,234
  
  197
  
  149
  
  126Australia Pacific
  
  2,123
  
  2,220
  
  934
  
  452
  
  353
  
  257Africa
  
  605
  
  914
  
  398
  
  408
  
  315
  
  336Other
  
  52
  
  33
  
  31
  
  491
  
  481
  
  300Total
  
  8,060
  
  8,643
  
  5,460
  
  350
  
  283
  
  224Copper(1)South America
  
  315
  
  308
  
  
  
  0.70
  
  0.62
  
  Australia Pacific
  
  87
  
  59
  
  
  
  1.37
  
  1.53
  
  Total
  
  402
  
  367
  
  
  
  $
  0.83
  
  $
  0.79
  
  $
    
 (1)The 2005
comparative periods for copper have been omitted as we did not produce any
significant amounts of copper prior to the acquisition of Placer Dome.  41


North
America  Key
Operating Statistics  For the years ended
  December 31
  
  2007
  
  2006
  
  % Change
  
  2005Tons mined(millions)
  
  335
  
  274
  
  22
  %
  168Ore tons processed(millions)
  
  76
  
  69
  
  10
  %
  50Average grade(ozs/ton)
  
  0.040
  
  0.045
  
  (11
  )%
  0.045Gold produced(000s/oz)
  
  3,201
  
  3,372
  
  (5
  )%
  2,863Total cash costs(per oz)
  
  $
  370
  
  $
  314
  
  18
  %
  $
  244  Producing
Mines  Tons mined increased 22%
in 2007 primarily due to higher waste stripping activities at Goldstrike, Bald
Mountain and Cortez (41% of overall increase) and the production start-up at
Ruby Hill (46% of overall increase). Tons processed increased by 10% due to
higher processing rates at Cortez (63% of overall increase), due to mining
areas of the pit that are yielding better ore grades and more ore tons than the
prior year, and the production start-up of Ruby Hill (36% of overall increase).
Average ore grades decreased by 11% mainly due to sequencing at Goldstrike and
Bald Mountain.  At Goldstrike open
pit, an extended period of overburden removal commenced to expand the pit
running into mid-2008, during which time we will have limited ore production
from the pit. During this period, Goldstrike will supplement mill feed with
lower-grade stockpiled ore resulting in lower production levels. Production at
Goldstrike underground was also impacted by a transition to zone mining in
2007. Production levels at Goldstrike are expected to increase in the second
half of 2008 when higher-grade ore becomes accessible. At Eskay Creek,
production levels continued to decline as the mine is reaching the end of its
life.  Gold production
levels for the region declined by 5% in 2007 as the 11% decline in the average
ore grade more than offset the 10% increase in tons processed.  Total cash costs
of $370 per ounce were 18% higher than the prior year reflecting waste removal
costs at Ruby Hill ($7 per ounce); lower silver by-product credits mainly at
Eskay Creek ($8 per ounce); lower overall production levels in 2007 ($19 per
ounce); higher prices and consumption of input commodities used in the
production process ($7 per ounce); and higher costs related to labor ($7 per
ounce); and higher royalties and production taxes ($2 per ounce). The type of
ore processed in 2007 at the Goldstrike autoclave required more consumables
such as propane and acid to achieve optimal efficiency. This resulted in higher
total cash costs of $17 dollars per ounce for Goldstrike autoclave when
compared to the prior year. During 2007, a modified pressure technology was
successfully tested that will extend the life of the Goldstrike autoclaves by
allowing them to process ore that would have previously been treated at the roaster
facility.  In 2008, we expect
gold production of 3.0 to 3.15 million ounces at total cash costs of $450 to
$465 per ounce. Production is expected to be lower than 2007 primarily due to
the mining of lower-grade ore. Total cash costs per ounce are expected to be
higher in 2008 due to the impact of lower production; lower silver credits due
to the closure of Eskay Creek, increased labor rates; higher energy costs
mainly due to higher oil prices; and higher royalties and production taxes as a
result of higher gold prices.  Significant
Projects  At the Cortez Hills
project in Nevada, we spent $88 million in 2007 (100% basis) for open-pit
mining equipment; engineering for the project infrastructure; installation of
dewatering wells; ongoing construction of the underground pump station rock
work; and completion of an additional 439 meters of the underground exploration
decline. Total underground decline development of 4,854 meters has been
completed to date. Engineering is approximately 90% complete, resulting in
expected permitting during the second half of 2008. Pre-production capital
costs are expected to remain in the range of our previous estimate of $480 to
$500 million. Production in the first full five years is expected to be in the
range of 950 thousand to 1 million ounces (includes Pipeline) at total cash
costs of $280 to $290 per ounce. Barricks interest in proven  42


and probable reserves at
year-end 2007 for the Cortez property was 6.9 million ounces (60% basis).(1) On closing of the transaction to increase
our interest to 100%, we will report an additional 4.6 million ounces of proven
and probable reserves for a total of 11.5 million ounces.  At the Pueblo
Viejo project (60% owned), we spent $69 million (100% basis) in 2007 to update
the feasibility study, commencement of basic and detail design and engineering,
exploration programs for ore reserves and limestone deposits, community
development programs and sourcing of electric power and location of power
transmission lines. We expect to be in a position to submit our feasibility
study and project notice shortly. Pre-production capital is expected to be
about $2.7 billion on a 100% basis (about $1.6 billion is Barricks share). The
increase in capital from the earlier $2.1 to $2.3 billion estimate primarily
reflects a scale up to a throughput rate of 24 thousand tonnes per day (tpd),
up from the 18 thousand tpd described previously. This has had the effect of
increasing our share of gold production in the first full five years of
production to about 600 thousand ounces per year from 465 to 480 thousand
ounces per year. Total cash costs are expected to be about $250 per ounce over
this period and do not include the potential benefit of a circuit to recover
zinc, which continues to be evaluated. The construction period to first gold
production is expected to be about three and a half years from project
decision. Our equity share of proven and probable gold resources at Pueblo
Viejo increased by 1.4 million ounces in 2007 to 12.3 million ounces.(2)  At the Donlin
Creek project, we advised our joint venture partner, NovaGold Resources Alaska
Inc., in October 2007 that we had completed work on the feasibility study
for the project. In December 2007, we entered into an agreement with
NovaGold to form a jointly owned limited liability company on a 50/50 basis to
advance the project, with a NovaGold appointee positioned as the initial
General Manager. Work completed in 2007 included more than 70 thousand meters of
drilling (primarily infill) and collection of additional environmental baseline
data, in addition to a wide range of engineering work completed in support of
the feasibility study. Work in the first half of 2008 will focus on completing
a series of optimizing studies for power, logistics, processing and production
levels, and will integrate all data from the 2007 program into a final
feasibility study. measured and indicated gold resources increased by 8.7
million ounces in 2007 to 14.7 million ounces.(1)  
 (1)For a breakdown of
reserves and resources by category and additional information relating to
reserves and resources, see pages 136 to 144 of this Financial Report
2007.  (2)Calculated in accordance
with National Instrument 43-101 as required by Canadian securities regulatory
authorities. For United States reporting purposes, Industry Guide 7, (under the
Securities and Exchange Act of 1934), as interpreted by Staff of the SEC,
applies different standards in order to classify mineralization as a reserve.
Accordingly, for U.S. reporting purposes, Pueblo Viejo is classified as
mineralized material. For a breakdown of reserves and resources by category and
additional information relating to reserves and resources, see pages 136
to 144.  South
America  Key Operating Statistics  For the years ended
  December 31
  
  2007
  
  2006
  
  % Change
  
  2005Tons mined(millions)
  
  151
  
  168
  
  (10
  )%
  134Ore tons processed(millions)
  
  59
  
  53
  
  11
  %
  35Average grade(ozs/ton)
  
  0.042
  
  0.054
  
  (22
  )%
  0.048Gold produced(000s/oz)
  
  2,079
  
  2,104
  
  (1
  )%
  1,234Total cash costs(per oz)
  
  $
  197
  
  $
  149
  
  32
  %
  $
  126  Producing
Mines  Tons mined decreased by
10% in 2007, mainly due to Pierina (56% of overall decrease), where the mine
plan was changed to solve a temporary problem of lack of waste dump capacity
due to the fuel station relocation, and also at Veladero (32% of overall
decrease), where low equipment availability temporarily limited production in
2007. Ore tons processed increased in 2007 by 11%, mainly at Veladero, as
higher quantities of material were placed on the leach pad compared to the
prior year. Average ore grade declined by 22% in 2007, primarily due to
Veladero, where lower-grade zones were mined in 2007. Gold production levels in
2007 were similar to the prior years as the lower average ore grades were
mostly offset by higher processing rates.  43


Total cash costs
per ounce increased by 32% to $197 dollars per ounce in 2007, largely due to
higher costs at Veladero as mining transitioned to lower grade ore in the Filo
Federico pit beginning in April 2007 and we began expensing waste
stripping costs at Filo Federico ($33 an ounce); higher labor and maintenance
costs ($7 an ounce); and higher costs for consumables used within the
production process ($7 an ounce). Cost pressures were mitigated to a certain
extent by operational improvements such as improved maintenance procedures,
improved ore recoveries at Pierina, and lower reagent consumption and higher silver
production at Lagunas Norte.  In 2008, we expect
gold production of 1.95 to 2.05 million ounces at total cash costs of $250 to
$270 per ounce. Production is expected to remain consistent with 2007, as
higher production at Veladero is expected to be offset by lower production at
Pierina. Total cash costs per ounce are expected to be higher in 2008, mainly
due to higher energy costs, labor rates and other cost increases.  Significant
Projects  The Pascua-Lama project
is unique in that it is a bi-national project with a mineral deposit that spans
the border between Argentina and Chile. It is located in the Frontera district
within approximately 10 kilometers of our Veladero mine. The project is at an
elevation of 3,800 to 5,200 meters. In February 2006, the Pascua-Lama
project was granted approval by Chilean environmental regulatory authorities.
In December 2006, the Province of San Juan, Argentina issued its
Declaration of Environmental Impact Assessment which approved the environmental
permit submission to Argentina. We have significantly advanced detailed
engineering and have essentially completed submission of documentation to
obtain the administrative and sectoral permit approvals that are required prior
to initiating construction in either country. In addition, the governments of
Chile and Argentina must resolve certain remaining fiscal matters, including
taxation relating to the bi-national project. The start of construction is
contingent upon receipt of sectoral permits and resolution of cross-border
regulatory and fiscal tax and royalty items, the timing of which is largely
beyond our control. The project team is using this period to advance detailed
construction planning and activities as well as supplier and contractor
selection through competitive bidding.  As at February 2007,
pre-production capital costs were in the range of $2.3 to $2.4 billion and are
currently expected to be approximately 15% higher than this estimate primarily
due to inflationary pressures and currency impacts. Gold and silver productions
are expected to be about 750775 thousand ounces of gold and about 35 million
ounces of silver per year over the first five years. Current silver prices are
expected to have a positive impact on total cash costs for the project. An
updated feasibility study will be prepared and the capital cost will be updated
on the resolution of the cross-border regulatory, fiscal, tax and royalty
items, and the granting of the remaining sectoral permits. Proven and probable
gold reserves increased by 1.0 million ounces to 18.0 million ounces in 2007.(1)  Australia
Pacific  Key Operating Statistics  For the years ended
  December 31
  
  2007
  
  2006
  
  % Change
  
  2005Tons mined(millions)
  
  144
  
  137
  
  5
  %
  167Ore tons processed(millions)
  
  33
  
  30
  
  10
  %
  11Average grade(ozs/ton)
  
  0.075
  
  0.087
  
  (14
  )%
  0.083Gold produced(000s/oz)
  
  2,123
  
  2,220
  
  (4
  )%
  934Total cash costs(per oz)
  
  $
  452
  
  $
  353
  
  28
  %
  $
  257  Producing
Mines  Tons mined increased by
5% in 2007 as Porgera production levels increased from mid-2007 onwards on
completion of west wall remediation activities and a 20% increase in ownership
(which represented 63% of the overall increase in tons mined). Production at
Porgera in the early part of 2007 was impacted by the Hides Power station
damage that occurred in December 2006; a 10 day shutdown of operations in
second quarter 2007 due to a dispute with landowners, and a delay in completion
of the west wall cutback delayed the start of full-scale mining in Stage 5. At
Cowal, tons mined increased reflecting a full-year contribution from the mine
that began production in 2006 (37% of the overall increase in tons mined). Tons
mined decreased due to: the end of mining in the Lawlers Fairyland open pit in
early 2007; the end of  
 (1)For a breakdown
of reserves and resources by category and additional information relating to
reserves and resources, see pages 136 to 144 of this Financial Report
2007.  44


open
pit mining and transition to underground mining at Granny Smith; and the sale
of Paddington assets and the completion of open pit mining at Kanowna.
Together, these decreases represented 87% of the offsetting overall decrease in
total tons mined. Production in 2008 is expected to be similar to 2007 levels
with increases at Porgera (due to a full year of production after completion of
the West Wall remediation) and Granny Smith (due to an increase in tons from
the underground as the number of working areas increases), offset by lower
production at Cowal (due to a wall failure at our open pit).  Ore tons processed increased by 10%, mainly reflecting a full years
contribution from the Cowal Mine. Mill feed at Lawlers, Granny Smith and
Kanowna was maintained by processing low-grade stockpiles to compensate for the
lower tons mined in 2007.  Average ore grades declined by 14% in 2007, mainly as a result of
processing low-grade stockpiles at Granny Smith, Kalgoorlie and Plutonic. At
Granny Smith, low-grade stockpiles were processed while mining transitioned
from open-pit to underground. At Kalgoorlie, limited shovel availability early
in the year led to the processing of more low-grade stockpiled ore. At
Plutonic, lower average grades in 2007 resulted from poor equipment
availability, temporary blockages of the Baltic paste fill line with a loss of
flexibility in the underground mine, and stope sequencing issues. With the
implementation of improvement programs, mining rates and shovel availability,
we expect production at these mines to increase in 2008. At Cowal, production
continued to improve in the latter half of 2007 due to grade improvements
resulting from the conversion to sulfide material milling. The rise of ore tons
processed also contributed to the decline in average ore grades. Gold production
in 2007 decreased by 4% as the lower average ore grades were partly offset by
higher ore processing rates.  Total cash costs
at $452 per ounce in 2007 were 28% higher compared to the prior year, due to
higher levels of expensed waste stripping activity at Porgera after the west
wall remediation was completed mid-year and normal mining operations returned
in the pit ($35 per ounce); higher currency exchange rates ($31 per ounce);
higher labor costs ($29 per ounce); higher commodity prices ($17 per ounce); offset
by loweradministrative
costs ($9 per ounce). The effective currency hedge rate for 2007 was 0.77
compared to 0.71 in the prior year. At the start of 2007, our currency hedging
program provided protection for approximately 80% of our Australian dollar
costs, but the remaining portion was subject to varying market rates. We added
to our hedge position part way through the year, and as a result, were fully
hedged for the latter part of 2007 and for 2008 at an average rate of 0.77 and
0.78, respectively. Low unemployment, particularly in Western Australia,
continues to impact wage levels and the ability to attract and retain staff.  In 2008, we expect gold production of 1.975 to 2.15 million ounces at
total cash costs of $450 to $475 per ounce. Total cash costs per ounce are
expected to be higher in 2008 due to higher currency hedge rates, higher oil
prices, labor rate increases and higher royalty costs.  Africa  Key Operating Statistics  For the years ended
  December 31
  
  2007
  
  2006
  
  % Change
  
  2005Tons mined(millions)
  
  23
  
  21
  
  10
  %
  8Ore tons processed(millions)
  
  4
  
  5
  
  (20
  )%
  1Average grade(ozs/ton)
  
  0.162
  
  0.188
  
  (14
  )%
  0.159Gold produced(000s/oz)
  
  605
  
  914
  
  (34
  )%
  398Total cash costs(per oz)
  
  $
  408
  
  315
  
  30
  %
  $
  336  Producing Mines  Tons
mined increased by 10% in 2007, due mainly to North Mara, where low-grade areas
were mined along with increased waste removal due to instability of the west
wall, partly offset by the sale of South Deep.  Tons processed decreased by 20% in 2007 due to the sale of South Deep
(40% of overall decrease) and lower processing rates across all other mines.  Average ore grades declined by 14% in 2007, mainly due to lower grades
at North Mara after a revision to the mine plan resulting from pit wall
instability experienced at Gokona Phase 1 pit during late 2006. Lower-grade
areas of the pit were mined and processing of lower-grade ore stockpiles
occurred while waste at the pit wall was removed. Mining was also affected by
unfavorable drilling conditions, excess water in the pit, maintenance downtime
on existing mining fleet,  45


and
continued low equipment availabilities during the year. Limited mining
equipment availability resulted in delayed waste stripping, limiting access to
the high-grade areas of the Gokona pit to the last two weeks of December. These
access issues impacted ore grades as the limited ore from the Gokona pit was
blended with lower grade stockpiles and ore from the Nyabigena pit. On January 1,
2008, a fire started in the engine of the primary excavator. This incident will
have a negative impact on normal production capacity for the first half of
2008. An insurance claim for both physical damage and business interruption has
been lodged with the insurers.  The combined effect of lower tons processed and lower average ore
grades led to a 34% decrease in production in 2007 compared to the prior year.
Production in 2007 was impacted by heavy rainfall in Tanzania in late 2006 and
early 2007, which resulted in pit wall instability at both Tulawaka and North
Mara, and required changes to the 2007 mine plan and production sequencing. At
Tulawaka, the impact on production of the pit wall instability was mitigated as
a result of mining in higher grade areas of the pit. Underground development
commenced at Tulawaka during the third quarter 2007, with underground
production expected to begin in early 2008.  At Bulyanhulu, production in 2007 was 26% lower than the prior year
period due to lower mining rates caused by low equipment availability, mining
in lower-grade areas of the mine, and labor disruptions. Ongoing labor
disruptions experienced throughout the year escalated in the fourth quarter, as
an illegal labor strike took place at the mine during late October, resulting
in the termination of 1,300 employees. As a result of the reduced staff levels,
the mine sequencing was revised, impacting our ability to access higher-grade
areas and operate the plant at its full capacity. The mine is in the process of
increasing its staff levels in stages, and expects to return to normal
production capacity in early 2008.  Total cash costs per ounce for the region in 2007 were 30% higher than
the prior year due to the lower production at North Mara and Bulyanhulu; higher
waste mining at North Mara and Tulawaka; higher maintenance costs ($16 per
ounce); and higher labor costs ($12 per ounce) as a result of costs relating to
the labor strike at Bulyanhulu.  In 2008, we expect gold production of 0.625 to 0.7 million ounces at
total cash costs of $380 to $400 per ounce. Production is expected to increase
primarily at Bulyanhulu, reflecting the resolution of labor issues, improved
equipment availability, and higher ore grades. Total cash costs per ounce are
expected to be lower in 2008, reflecting the increase in production levels.  Significant Projects  The
Buzwagi project was approved for construction on August 1, 2007, and is
expected to begin production in mid-2009. We spent $112 million through the end
of 2007 as all long lead items have been ordered. Initial capital costs are
expected to be about $400 million, which is consistent with our previous
guidance. Site access was achieved on August 20, 2007, with the civil and
earthworks, security fencing, building and infrastructure and transport and
logistics contractors mobilized on site. Buzwagi is expected to produce 250 to
260 thousand ounces per year at total cash costs of $270280 per ounce in its
first five years. Proven and probable gold reserves at Buzwagi grew by 1.0
million ounces in 2007 to 3.6 million ounces.(1)  Work on a pre-feasibility study for the Sedibelo platinum project in
South Africa commenced in March 2006. Barrick has an earn-in right for a
50% interest. The pre-feasibility study was completed during September 2007
and cost $27 million. Acceptance of the Mining Rights application was received
from the Department of Minerals and Energy (DME) in April 2007, and
approval of the Mining Rights application is expected in April 2008. This
acceptance signifies the start of an approval process during which technical,
environmental and social issues are presented to the DME over a period
extending into 2008. Study work and exploration drilling in support of a final
feasibility study have commenced, with completion expected in the second
quarter of 2008.  
 (1)For a
breakdown of reserves and resources by category and additional information
relating to reserves and resources, see pages 136 to 144 of this Financial
Report 2007.  46


At the Kabanga JV in Tanzania, operator
Xstrata Plc is developing a pre-feasibility study on this world-class nickel
sulfide deposit. Barricks share of measured and indicated resources totaled
0.2 billion pounds of nickel and its share of inferred resources totaled 1.2
billion pounds of nickel at year end 2007.(1)  Other Significant Projects  Fedorova is a platinum and palladium project with nickel, copper and
gold by-products located in the Kola Peninsula of the Russian Federation. We
hold a 50% interest in Fedorova (with an earn-in right to 79%), and we are also
the operator. Fedorova is a large near surface PGM (platinum group metals)
deposit. Fedorova Resources successfully passed an inspection by state
regulators and was determined to be in compliance with all material aspects of
its license and state requirements.  Reko Diq is a large copper-gold porphyry
mineral resource on the Tethyan belt, located in southwest Pakistan in the
province of Baluchistan. The Tethyan belt is a prospective ground for large
copper-gold porphyries. At Reko Diq, the drill program continued in fourth
quarter 2007 with a feasibility study scheduled for completion in early 2009. A
total of 101 thousand meters have been drilled to date and results continue to
confirm the projects district exploration potential. At year-end 2007, Barricks
share of measured and indicated gold resources totaled 3.7 million ounces and
its share of measured and indicated copper resources were 4.3 billion pounds.
Inferred gold resources grew 6.1 million ounces to 10.5 million ounces and
inferred copper resources increased by 9.1 billion pounds to 13.4 billion
pounds.(1)  
 (1)For a
breakdown of reserves and resources by category and additional information
relating to reserves and resources, see pages 136 to 144 of this Financial
Report 2007.  Copper  Copper Operational Performance    In 2007, Zaldívar produced 315 million pounds of copper at a total cash
cost of $0.70 per pound. Production was temporarily lower in the fourth quarter
due to shortages in the availability of acid, power restrictions associated
with a November earthquake and lower production from the secondary leach
pad. Total cash costs per pound in 2007 were impacted by the increased cost of
fuel and acid, which can be expected to increase further in 2008, along with
inflationary and exchange rate pressure on labor and consumables, and the
availability of electricity.  At Osborne, production increased by 47% to 87
million pounds from 59 million in the prior year, at cash costs of $1.37 compared
to $1.53 in the prior year. Production was positively impacted by the paste
fill plant that enabled mining of high grade pillars and higher throughput due
to the inclusion of ore from the open pit at Trekelano.  47


Review of Significant
Operating Expenses  Exploration
Expense  ($ millions)
  
  2007
  
  2006
  
  2005
  
  Comments on significant variancesExplorationNorth America
  
  $
  70
  
  $
  64
  
  $
  34
  
  No
  significant change from the prior year.South America
  
  40
  
  22
  
  19
  
  2007 vs.
  2006  Mainly due to higher activity in Lagunas Norte and Zaldívar.Australia Pacific
  
  46
  
  44
  
  13
  
  No
  significant change from the prior year.Africa
  
  15
  
  22
  
  34
  
  2007 vs.
  2006  Lower activity at Tulawaka and North Mara.Other
  
  8
  
  19
  
  9
  
  Lower
  activity due mainly to the sale of exploration properties to Highland,
  discontinuation of active exploration in China and Turkey.Total
  
  $
  179
  
  $
  171
  
  $
  109  Project Development
Expense  ($ millions)
  
  2007
  
  2006
  
  2005
  
  Comments on significant variancesMine development
  
  $
  146
  
  $
  78
  
  $
  2
  
  2007 vs.
  2006  Expenditures are higher as development activities increased at Pueblo
  Viejo (increase of $42 million), and Sedibelo (increase of $12 million), partially
  offset by Donlin Creek (decrease of $5 million).Business development/other
  
  22
  
  17
  
  10
  
  In 2007,
  expenditures were higher primarily as a result of energy feasibility studies.
  In 2006, expenditures were higher than 2005 due to an increase in research
  and development activity.Non-capitalizable project costs
  
  20
  
  24
  
  20
  
  Non-capitalizable
  costs mainly represent items incurred in the development/construction phase
  that cannot be capitalized. 2007 vs. 2006  Expenditures are lower due to
  additional spending at Pascua-Lama, offset by a decrease at Buzwagi where
  costs were capitalized starting in May 2007.Total
  
  $
  188
  
  $
  119
  
  $
  32  Amortization
  Expense  ($ millions)
  
  
  
  Increase (decrease)
  due toFor the years ended
  December 31
  
  2007
  Amount
  
  Sales
  Volumes(1)
  
  Other(2)
  
  2006
  Amount(3)
  
  2005
  Amount
  
  Comments on other variancesGold minesNorth America
  
  $
  314
  
  $
  (3
  )
  $
  70
  
  $
  247
  
  $
  213
  
  Mainly due
  to the finalization of the Placer Dome purchase price allocation. Although
  there was a net increase in reserves for South America, reserves for Pierina
  and Veladero decreased resulting in a significant increase in amortization
  expense. Furthermore, we acquired an additional 20% interest in Porgera in
  August 2007, and Cowal in 2006.South America
  
  234
  
  (22
  )
  129
  
  127
  
  101Australia Pacific
  
  239
  
  (10
  )
  63
  
  186
  
  46Africa
  
  78
  
  9
  
  (19
  )
  88
  
  49Copper minesSouth America
  
  80
  
  3
  
  26
  
  51
  
  
  
  Mainly due
  to the finalization of the purchase price allocation for long-lived assets
  acquired with Placer Dome, combined with a net increase in reserves.Australia Pacific
  
  39
  
  2
  
  20
  
  17
  
  Sub total
  
  $
  984
  
  
  
  
  
  $
  716
  
  $
  409Corporate assets
  
  20
  
  1
  
  
  
  19
  
  18Total
  
  $
  1,004
  
  $
  (20
  )
  $
  289
  
  $
  735
  
  $
  427  
 (1)For explanation of changes in
sales volumes refer to page 36.  (2)Other includes
increases/decreases in amortization expense due to additions/dispositions of property,
plant and equipment, purchase accounting adjustments and the impact of historic
changes in reserve estimates on amortization (refer to page 64).  (3)On finalization of the Placer
Dome purchase price allocation in 2007 certain amounts were reclassified for
comparative purposes.  48


Amortization
expense recorded in the first nine months of 2006 reflected preliminary
purchase price allocations for the acquired Placer Dome mines. In fourth
quarter 2006 valuations for the acquired mines were finalized, at which time
amortization calculations were prospectively recorded to reflect adjustments to
the preliminary allocation. On finalization of the purchase price allocation,
consolidated average amortization rates increased by about $17 per ounce of
gold and $0.13 per pound of copper due to the impact of final allocations.  Impairment
Charges, Corporate Administration, Interest Income and Interest Expense  ($ millions)For the years ended December 31
  
  2007
  
  2006(1)
  
  2005
  
  Comments on significant trends and variancesImpairment charges(2)
  
  $
  65
  
  $
  23
  
  $
  16
  
  Impairment charges increase in 2007 reflects
  goodwill impairment charges at our Golden Sunlight and Eskay Creek mines ($42
  million) and write-down of Asset-Backed Commercial Paper (ABCP) ($20
  million).Corporate administration
  
  155
  
  142
  
  71
  
  2007 vs. 2006  Mainly due to the strengthening of
  the Canadian dollar vs. the US dollar as costs are primarily in Canadian
  dollars.Interest income
  
  141
  
  110
  
  38
  
  2007 vs. 2006  Mainly due to higher average cash
  balances in 2007.Interest costsTotal incurred
  
  237
  
  251
  
  121
  
  2007 vs. 2006  Mainly due to a combination of
  factors: repayment of the $500 million, 7.5% debentures in second quarter
  2007, termination of a second credit facility in third quarter 2006, and
  repayment of the first credit facilitys balance outstanding in October 2006
  slightly offset by the $1,000 million of Copper-linked notes issued in October 2006.Capitalized
  
  124
  
  102
  
  118
  
  Amounts capitalized each period reflect the number
  of projects in our pipeline. Reko Diq was added in fourth quarter 2006 which
  caused an increase in 2007. Costs were capitalized at Cowal in 2005 until it
  began production in April 2006.Interest expense allocated to discontinued
  operations
  
  
  
  23
  
  
  
  Interest expense in 2006 related to South Deep.Expensed
  
  $
  113
  
  $
  126
  
  $
  3  
 (1)Increase in 2006 relates to the
increase in scale of the Company after the acquisition of Placer Dome. 2006 and
2007 values are more indicative of full scale operations subsequent to the
acquisition of Placer Dome.  (2)As at December 31, 2007,
we held $66 million of ABCPs which have matured, but for which no payment has
been received. Our ownership of ABCP investments is comprised of trust units
which have underlying investments in various securities. The underlying
investments are further represented by residential mortgage backed securities,
commercial mortgage backed securities, other asset backed securities and
collateralized debt obligations. We have assessed the fair value of the ABCP
considering the best available data regarding market conditions for such
investments at December 31, 2007. We recorded an impairment of $20 million
in 2007 on the ABCP investments. We have based the 30% impairment on our
assessment of the credit, liquidity and market risk of the underlying
investments in addition to third party valuation information. We believe that
the valuation provided approximates fair value. The impairment of our ABCP
investments has no affect on our strategy or covenant compliance.  Income
Tax  (percentages)
  For the years ended December 31
  
  2007
  
  2006
  
  2005Effective tax rate on ordinary income
  
  25
  %
  20
  %
  13
  %Deliveries into Corporate Gold Sales Contracts
  
  7
  %
  4
  %
  3
  %Net currency translation gains on deferred
  tax balances
  
  (4
  )%
  (1
  )%
  (2
  )%Canadian tax rate changes
  
  3
  %
  1
  %
  Release of Tanzanian valuation allowances
  
  (8
  )%
  
  
  Impact of change in Australian tax status
  
  
  
  (2
  )%
  (1
  )%Actual effective tax rate
  
  23
  %
  22
  %
  13
  %  Our effective tax
rate on ordinary income increased from 20% to 25% in 2007 primarily due to
higher market gold prices, the impact of changes in the mix of production, and
on the mix of taxable income in the various tax jurisdictions where we operate.  In 2007 we released valuation allowances totaling $156 million in
Tanzania due to the impact of higher market gold prices on expected levels of
taxable income in Tanzania.  49


Currency Translation  Deferred tax
balances are subject to remeasurement for changes in currency exchange rates
each period. The most significant balances are Canadian deferred tax assets
with a carrying amount of approximately $439 million and Australian deferred
tax liabilities with a carrying amount of approximately $95 million. In 2007,
the appreciation of the Canadian and Australian dollar against the US dollar
resulted in net translation gains totaling $76 million. These gains are
included within the Canada and Australia deferred tax recovery.  Canadian Tax Rate Changes  In the second and
fourth quarters of 2007 and the second quarter of 2006, federal rate changes
were enacted in Canada that lowered the applicable tax rate. The impact of this
tax rate change was to reduce net deferred tax assets in Canada by $64 million
in 2007 and $35 million in 2006 which are recorded as a component of deferred
income tax expense in the respective year. Also, in second quarter 2006, due to
a change in the tax status of a Canadian subsidiary, we recorded a deferred
income tax credit of $23 million to reflect the impact on the measurement of
deferred income tax assets and liabilities.  Change
in Tax Status in Australia  In first quarter 2006, an interpretative decision (ID)
was issued by the Australia Tax Office that clarified the tax treatment of
currency gains and losses on foreign denominated liabilities. Under certain
conditions, for taxpayers who have made the functional currency election, and
in respect of debt that existed at the time the election was made, the ID
provided clarification that unrealized foreign exchange gains that currently
exist on inter-company debt will not crystallize upon repayment of the debt.
The effect of the ID was recorded as a $31 million reduction of deferred tax
liabilities.  Financial Outlook  2008
Guidance  2007
  
  2008Actual
  
  GuidanceGoldProduction(millions of ounces)
  
  8.1
  
  7.68.1Total cash costs($ per ounce)
  
  $
  350
  
  $390$415Amortization ($ per ounce)
  
  $
  104
  
  $105CopperProduction(millions of pounds)
  
  402
  
  380400Total cash costs($ per pound)
  
  $
  0.83
  
  $1.15$1.25Amortization ($ per pound)
  
  $
  0.32
  
  $0.35Corporate administration expense
  
  $
  155
  
  $160Exploration expense
  
  $
  179
  
  $200Project expenses:Project development expense
  
  $
  188
  
  $230Project expense included in equity pick-up
  
  $
  14
  
  $140Other expenses
  
  $
  208
  
  $200Interest income
  
  $
  141
  
  $20Interest expense
  
  $
  113
  
  $Capital expenditures  sustaining
  
  $
  690
  
  $600$800Capital expenditures  projects
  
  $
  400
  
  $1,500$1,700Income tax rate
  
  25
  %
  30
  %  Outlook Assumptions and
Economic Sensitivity Analysis  2008GuidanceSensitivity
  
  Assumption
  
  CommentsMarket gold price impact on royalties and
  production taxes
  
  $800/oz
  
  A $25/oz increase in the market gold price causes a
  $1/oz increase in total cash costs.Crude oil price impact on cost of oil
  consumption
  
  $90/bbl
  
  A $5 increase per barrel causes a $2/oz direct
  increase in total cash costs per ounce.Electricity prices impact on cost of
  consumption
  
  $ 280 million total spend
  
  A 10% increase per kwh causes a $4/oz increase in
  total cash costs per ounce.  50


2008
Guidance Analysis  Production  We prepare estimates of future production based on mine plans that
reflect the expected method by which we will mine reserves at each mine. Actual
gold and copper production may vary from these estimates for a number of
reasons, including if the volume of ore mined and ore grade differs from
estimates, which could occur because of changing mining rates; ore dilution;
varying metallurgical and other ore characteristics; and short-term mining
conditions that require different sequential development of ore bodies or
mining in different areas of the mine. Mining rates are impacted by various
risks and hazards inherent at each operation, including natural phenomena, such
as inclement weather conditions, floods and earthquakes, and unexpected labor
shortages or strikes.  The Company expects 2008 gold production of
about 7.6 to 8.1 million ounces and copper production of about 380 to 400
million pounds. Lower gold production is expected in North America as a result
of lower production at Golden Sunlight and Ruby Hill and the end of production
from Eskay Creek, while production in South America, Australia and Africa is
expected to be similar to 2007 levels.  Total Cash Costs  We prepare estimates of total cash costs based on expected costs
associated with mine plans that reflect the expected method by which we will
mine reserves at each mine. Total cash costs per ounce/pound are also affected
by ore metallurgy that impacts gold and copper recovery rates, labor costs, the
cost of mining supplies and services, foreign currency exchange rates and
stripping costs incurred during the production phase of the mine. In the normal
course of our operations, we attempt to manage each of these risks to mitigate,
where possible, the effect they have on our operating results.  Total cash costs are expected to be $390 to
$415 per ounce for gold and $1.15 to $1.25 per pound for copper. Gold cash
costs in 2008 are forecast to be higher than 2007 primarily due to higher
energy costs, lower by-product silver credits from Eskay Creek,higher gold price related costs and some
inflationary related increases. The Company has assumed an average WTI oil
price of $90 per barrel in the 2008 guidance. This compares to an average price
of $72 per barrel in 2007.    Total cash costs for copper are expected to be approximately $0.32 per
pound higher than 2007, primarily as a result of increased costs for
electricity and acid at Zaldívar.  Exploration and Project Development  Higher costs are expected in 2008 due to higher expenses for Pueblo
Viejo as well as at Kainantu and Cerro Casale.  Interest Income and Interest Expense  We expect lower interest income in 2008 primarily due to lower market
interest rates and lower average cash balances in 2008, after the acquisitions
of Arizona Star; exploration licenses and the Kainantu gold mine from Highlands
Pacific for cash consideration in fourth quarter 2007; and closing of the
transaction to increase our ownership in Cortez to 100% in 2008. In 2008 we
expect that all interest costs will be capitalized to projects.  51


Project
Expenses  Project expenses
are classified under a combination of project development expenses and equity
method investments on our income statement. In aggregate, we expect to expense
$370 million in 2008. The increase in our project expenses compared to 2007
reflects higher activity at our Reko Diq, Kabanga, Sedibelo, Cerro Casale and
Kainantu projects in 2008.  The timing of the funding for project expenditures through equity
method investments and the subsequent expense recognition vary. The funding is
initially recorded as an increase in the carrying amount of our investment. Our
share of expenses is recognized as amounts are spent on the projects through equity
in investees in our consolidated statement of income. In 2008, we expect to
recognize $140 million in expenses through equity in investees. Funding of a
further $160 million will be reflected as an increase in the carrying amount of
the investments in our consolidated balance sheet.  Capital
Development Expenditures  Projects  We expect
increased activity at our project sites particularly, Pueblo Viejo, Buzwagi,
and Cortez Hills, resulting in increased expenditures in 2008.  Sustaining
Capital  Capital
expenditures at our existing operating mines are expected to increase in 2008
primarily in the Africa and Australia Pacific regions for various drill
programs to convert resources to reserves, partially offset by lower
expenditures in South America.  Income
Tax Rate  Our expected tax
rate excludes the impact of currency translation gains/losses and changes in
tax valuation allowances. The higher expected rate in 2008 mainly reflects the
impact of higher gold prices on the mix of taxable income in the various tax
jurisdictions where we operate.  Review
of Quarterly Results  Quarterly Information
  
  2007
  
  2006($ millions, except where indicated)
  
  Q4
  
  Q3
  
  Q2
  
  Q1
  
  Q4
  
  Q3
  
  Q2
  
  Q1Sales(1),(2)
  
  $
  1,917
  
  $
  1,684
  
  $
  1,642
  
  $
  1,089
  
  $
  1,348
  
  $
  1,562
  
  $
  1,532
  
  $
  1,188Net income
  
  537
  
  345
  
  396
  
  (159
  )
  418
  
  405
  
  459
  
  224Per share(3)(dollars)
  
  0.62
  
  0.40
  
  0.45
  
  (0.18
  )
  0.48
  
  0.47
  
  0.53
  
  0.29Adjusted net income from continuing
  operations(4)
  
  537
  
  345
  
  453
  
  398
  
  444
  
  396
  
  463
  
  266Per share(3)  basic(dollars)
  
  0.62
  
  0.40
  
  0.53
  
  0.46
  
  0.50
  
  0.46
  
  0.54
  
  0.34EBITDA from continuing operations(5)
  
  793
  
  710
  
  731
  
  193
  
  429
  
  694
  
  762
  
  423Per share(3)(dollars)
  
  0.91
  
  0.82
  
  0.85
  
  0.22
  
  0.44
  
  0.80
  
  0.88
  
  0.54Adjusted EBITDA from continuing
  operations(5)
  
  793
  
  710
  
  803
  
  757
  
  756
  
  694
  
  762
  
  463Per share(3)(dollars)
  
  0.91
  
  0.82
  
  0.93
  
  0.87
  
  0.88
  
  0.80
  
  0.88
  
  0.62Operating cash flow
  
  676
  
  557
  
  336
  
  163
  
  331
  
  748
  
  658
  
  385Per share(3)(dollars)
  
  0.78
  
  0.64
  
  0.39
  
  0.19
  
  0.38
  
  0.87
  
  0.76
  
  0.50Adjusted operating cash flow from
  continuing operations(6)
  
  676
  
  557
  
  408
  
  727
  
  658
  
  748
  
  658
  
  425Per share(3)(dollars)
  
  $
  0.78
  
  $
  0.64
  
  $
  0.47
  
  $
  0.84
  
  $
  0.76
  
  $
  0.87
  
  $
  0.76
  
  $
  0.55  
 (1)Prior period sales figures were
adjusted for the impact of a change in classification of non-hedge derivative
gains and losses. See page 71 for details.  (2)Adjusted for the impact of
reclassifying sales from our South Deep mine to discontinued operations in
third quarter 2006.  (3)Calculated using net income and
weighted average number of shares outstanding under the basic method of
earnings per share.  (4)Excluding the impact of
deliveries into Corporate Gold Sales Contracts. Adjusted net income from
continuing operations is an operating performance measure with no standardized
meaning under GAAP. For further information, please see page 69.  (5)EBITDA from continuing operations
excluding income tax expense, interest expense, interest income and
amortization. Adjusted EBITDA from continuing operations excludes the impact of
deliveries into Corporate Gold Sales Contracts, and is an operating performance
measure with no standardized meaning under GAAP.For further information see pages 69
to 70.  (6)Excluding the impact of
deliveries into Corporate Gold Sales Contracts. Adjusted operating cash flow is
an operating performance measure with no standardized meaning under GAAP. For
further information see page 69.  52


Our financial
results for the last eight quarters reflect the following general trends:
rising spot gold prices with a corresponding rise in prices realized from gold
sales, partly offset by higher total cash costs.  Fourth
Quarter Results  Net income for
fourth quarter 2007 was $537 million, $119 million higher than the prior year
period, as higher per ounce margins on gold and copper sales volumes were
partially offset by higher amortization and lower copper sales volumes. Fourth
quarter 2006 net income was reduced by $312 million post-tax due to deliveries
into Corporate Gold Sales Contracts.  In fourth quarter 2007, we produced 2.14 million ounces of gold and 101
million pounds of copper, compared to 2.44 million ounces and 110 million
pounds in the same prior-year quarter. Gold production for fourth quarter was
lower than the same prior-year period mainly due to lower production from
Africa and South America.  Total cash costs for fourth quarter 2007 were $375 per ounce, an
increase of $88 an ounce from the prior year. As expected, gold production and
total cash costs per ounce in fourth quarter 2007 were impacted due to mine
sequencing, waste stripping activities and inflationary pressures for items
such as labor, energy, commodities, gold related costs and currency exchange
rates.  In fourth quarter 2007, we generated adjusted operating cash flow of
$676 million compared to $658 million in the same prior year quarter. The
positive effects of higher realized gold and copper prices were partially
offset by lower gold sales volumes and higher total cash costs.  Effect
on Earnings Increase (Decrease)  Three months ended December 312007
  
  2006($ millions)
  
  Pre-tax
  
  Post-tax
  
  Pre-tax
  
  Post-taxGain on sale of South Deep
  
  $
  
  
  $
  
  
  $
  288
  
  $
  288Cost of deliveries into fixed-price
  Corporate Gold Sales Contracts
  
  
  
  
  
  (327
  )
  (312
  )Tanzanian Tax ValuationAllowance release
  
  156
  
  156
  
  
  
  Impact of change in enacted rates in Canada
  
  (60
  )
  (60
  )
  
  
  Impairment charges
  
  (59
  )
  (57
  )
  (23
  )
  (18
  )Gain on Highland vend-in
  
  
  
  
  
  51
  
  51Unrealized gold and copper non-hedge
  derivative gains/(losses)
  
  (3
  )
  (2
  )
  5
  
  11Total
  
  $
  34
  
  $
  37
  
  $
  (6
  )
  $
  20  53


Financial
Condition Review  The following section explains how we manage our liquidity and capital
resources to carry out our strategy and deliver results. Liquidity is managed
dynamically, and factors that could impact liquidity are regularly monitored.
The primary factors that affect liquidity include production levels, realized
sales prices, cash production costs, working capital requirements, future
capital expenditure requirements, scheduled repayments of long-term debt
obligations, our credit capacity and expected future debt market conditions.
Counterparties to the financial instrumentcontracts do not have unilateral and
discretionary rights to accelerate settlement of financial instruments, and we
are not subject to any margin calls.  Liquidity risk arises from our general
funding needs and in the management of our assets, liabilities and optimal
capital structure. We manage liquidity risk to maintain sufficient liquid
financial resources to fund our balance sheet and meet our project pipeline
commitments and obligations in a cost-effective manner.  Contractual
Obligations and Commitments  Payments due($ millions)
  
  
  
  
  
  
  
  
  
  
  
  2013 andAt December 31, 2007
  
  2008
  
  2009
  
  2010
  
  2011
  
  2012
  
  thereafter
  
  TotalLong-term debt(1)Repayment of principal
  
  $
  101
  
  $
  105
  
  $
  49
  
  $
  29
  
  $
  92
  
  $
  2,809
  
  $
  3,185Interest
  
  196
  
  190
  
  183
  
  179
  
  175
  
  2,459
  
  3,382Asset retirement obligations(2)
  
  71
  
  96
  
  81
  
  93
  
  105
  
  823
  
  1,269Capital leases
  
  21
  
  24
  
  20
  
  8
  
  3
  
  3
  
  79Operating leases
  
  10
  
  9
  
  6
  
  5
  
  5
  
  3
  
  38Restricted share units
  
  14
  
  32
  
  42
  
  
  
  
  
  
  
  88Pension benefits
  
  61
  
  24
  
  31
  
  24
  
  24
  
  117
  
  281Other post-retirement obligations
  
  3
  
  3
  
  3
  
  3
  
  3
  
  11
  
  26Derivative liabilities(3)
  
  101
  
  27
  
  25
  
  9
  
  3
  
  
  
  165Purchase obligations for supplies and
  consumables(4)
  
  323
  
  194
  
  96
  
  101
  
  70
  
  208
  
  992Capital commitments(5)
  
  263
  
  4
  
  
  
  
  
  
  
  
  
  267Social development costs
  
  63
  
  15
  
  14
  
  7
  
  7
  
  92
  
  198Total
  
  $
  1,227
  
  $
  723
  
  $
  549
  
  $
  458
  
  $
  487
  
  $
  6,525
  
  $
  9,969  
 (1)   Long-term Debt and Interest 
Included in long-term debt is $131 million in financing related to North Mara
that is payable on demand. Our debt obligations do not include any subjective
acceleration clauses or other clauses that enable the holder of the debt to
call for early repayment, except in the event that we breach any of the terms
and conditions of the debt or for other customary events of default. The
Bulyanhulu and Veladero financings are collateralized by assets at the
Bulyanhulu and Veladero mines, respectively. Other than this security, we are
not required to post any collateral under any debt obligations. The terms of
our debt obligations would not be affected by deterioration in our credit
rating. Projected interest payments on variable rate debt were based on
interest rates in effect at December 31, 2007. Interest is calculated on
our long-term debt obligations using both fixed and variable rates.  (2)   Asset Retirement Obligations
 Amounts presented in the table represent the undiscounted future payments for
the expected cost of asset retirement obligations.  (3)   Derivative Liabilities 
Amounts presented in the table relate to hedge contracts disclosed under notes
2 and 20 to the Financial Statements. Payments related to derivative contracts
cannot be reasonably estimated given variable market conditions.  (4)   Purchase Obligations for
Supplies and Consumables  Primarily include commitments related to community
development costs to be incurred at the Pascua-Lama project in Chile and
Argentina.  (5)   Capital Commitments 
Purchase obligations for capital expenditures include only those items where binding
commitments have been entered into. Commitments at the end of 2008 mainly
related to construction capital at our projects.  Capital
Expenditures Not Yet Committed  We expect to incur capital expenditures during the next five years for
both projects and producing mines. The projects are at various development
stages, from primarily exploration or scoping study stage through to the
construction execution stage. The ultimate decision to incur capital at each
potential site is subject to positive results which allow the project to
advance past decision hurdles. Primary and significant projects in Barricks
portfolio at December 31, 2007 include Cortez Hills, Buzwagi, Pascua-Lama,
Pueblo Viejo, Donlin Creek, Fedorova and Reko Diq (refer to pages 42 to 47
for further details).  54


Contingencies  Litigation  We are currently subject to various litigation as disclosed in note 28
to the Financial Statements, and we may be involved in disputes with other
parties in the future that may result in litigation. If we are unable to
resolve these disputes favorably, it may have a material adverse impact on our
financial condition, cash flow and results of operations.  Sources
and Uses of Cash  Our liquidity needs can be met through a variety of sources, including:
cash generated from operations, short-term borrowings and the issuance of
long-term debt.  Cash Inflow (Outflow)  ($ millions)For the years ended December 31
  
  2007
  
  2006
  
  2005Operating activities
  
  $
  1,732
  
  $
  2,122
  
  $
  726Investing activities
  
  (1,562
  )
  (1,593
  )
  (1,180
  )Financing activities
  
  (1,036
  )
  (1,347
  )
  93Change in cash and equivalents
  
  $
  (836
  )
  $
  2,006
  
  $
  (361
  )  Operating cash flow decreased by $390 million in 2007 to $1,732 million
compared to the prior year. Adjusted operating cash flow decreased by $121
million to $2,368 million compared to the $2,489 million recorded in 2006.    
 (1)Operating cash flows adjusted
for deliveries into Corporate Gold Sales Contracts.  Cash used in investing activities amounted to $1,562 million, primarily
due to our ongoing acquisitions and capital expenditures to advance our project
pipeline, partially offset by proceeds received from the sale of other
investments. Significant investing activities in 2007 included the $722 million
cash acquisition of Arizona Star, the $135 million cash acquisition of
Kainantu, and the $259 million cash acquisition of an additional 20% interest
in the Porgera mine. Capital expenditures, including capitalized interest,
amounted to $1,046 million. We also realized $625 million in proceeds related
to the sale of investments, the most significant being NovaGold ($221 million)
and Gold Fields ($356 million).  Capital Expenditures  ($ millions)For the years ended December 31
  
  2007
  
  2006
  
  2005Project capital expendituresPascua-Lama
  
  $
  175
  
  $
  113
  
  $
  98Cowal
  
  
  
  104
  
  258Ruby Hill
  
  
  
  29
  
  35Cortez Hills
  
  91
  
  26
  
  Buzwagi
  
  75
  
  
  
  Veladero
  
  
  
  
  
  213Lagunas Norte
  
  
  
  
  
  100Western 102 Power Plant
  
  
  
  
  
  80Tulawaka
  
  
  
  
  
  5Other
  
  
  
  13
  
  Sub total
  
  $
  341
  
  $
  285
  
  $
  789Regional capital expendituresNorth America
  
  $
  156
  
  $
  202
  
  $
  103South America
  
  197
  
  248
  
  114Australia Pacific
  
  223
  
  255
  
  50Africa
  
  112
  
  85
  
  40Other
  
  17
  
  12
  
  8Sub total
  
  705
  
  802
  
  315Total
  
  $
  1,046
  
  $
  1,087
  
  $
  1,104  55


Cash used in financing activities for 2007 was $1,036 million,
including repayment of $500 million of debentures that matured in 2007, $261
million of dividends paid, and $197 million to settle Placer Dome derivative
positions, partially offset by $142 million in proceeds received on exercise of
employee stock options.  Key
Financial Ratios  %
  inc./(dec.)(millions, except ratios and percentage amounts)
  
  2007
  
  2006
  
  2005Non-cash working capital(1)
  
  $
  1,018
  
  $
  764
  
  33
  %Net debt(2)
  
  $
  1,179
  
  $
  1,064
  
  11
  %Net debt to equity ratio(3)
  
  0.08:1
  
  0.07:1
  
  14
  %Current ratio(4)
  
  4.03:1
  
  4.85:1
  
  (17
  )%  
 (1)   Represents
current assets, excluding cash and equivalents, less current liabilities,
excluding short-term debt obligations.  (2)   Represents
long-term and short-term debt less cash and equivalents.  (3)   Represents
net debt divided by total shareholders equity.  (4)   Represents
current assets divided by current liabilities, excluding short-term debt
obligations.  Non-cash working capital increased in 2007 mainly due to increases in
inventory and other current asset levels as compared to the prior year. Lower
cash balances, partly offset by higher accounts payable at the close of 2007,
caused our current ratio to decrease.  Through the combination of a strong balance
sheet and positive operating cash flows, we have been able to secure financing,
as required, to fund our capital projects and acquisitions. At current gold
prices, we expect to continue to generate a significant amount of operating
cash flow. We expect to use this cash flow predominantly to fund the capital
requirements of our pipeline of projects.  Alternatives for sourcing our future capital
needs include our significant cash position, unutilized credit facilities,
future operating cash flow, project financings and public debt financings. These
alternatives are evaluated to determine the optimal mix of capital resources
for our capital needs. We expect that, absent a material adverse change in a
combination of our sources of liquidity and/or a significant decline in gold
and copper prices, present levels of liquidity will be adequate to meet our
expected capital needs. If we are unable to access project financing due to
unforeseen political or other problems, we expect that we will be able to
access public debt markets as an alternative source of financing. Any
additional indebtedness would increase our debt payment obligations, and may
negatively impact our results of operations.  Capital
Structure  Shareholders Equity  Outstanding Share Data
  
  Shares outstandingAs at February 7, 2008
  
  No. of sharesCommon shares
  
  870,465,549Special voting shares
  
  1Exchangeable shares(1)
  
  3,465,892Stock options
  
  12,706,450  
 (1)   Represents
Barrick Gold Inc. (BGI) exchangeable shares. Each BGI share is exchangeable
for 0.53 Barrick common shares. At January 17, 2008, these shares were
convertible into approximately 1,836,923 Barrick common shares.  For further information regarding the outstanding shares and stock
options, please refer to the Financial Statements and our 2007 Management Information
Circular and Proxy Statement.  56


Dividend
Policy  In 2007, we increased our
annual dividend from $0.22 per common share to $0.30 per common share. The 36%
increase in the dividend reflects our ability to generate substantial cash
flows in the current strong gold price environment. With strong cash flow and
an A-rated balance sheet, we have the financial resources to return additional
value to shareholders and fund our project pipeline. The amount and timing of
any dividends is within the discretion of our Board of Directors. The Board of Directors
reviews the dividend policy semi-annually based on the cash requirements of our
operating assets, exploration and development activities, as well as potential
acquisitions, combined with our current and projected financial position.  Comprehensive
Income  Comprehensive income
consists of net income or loss, together with certain other economic gains and
losses, that collectively are described as other comprehensive income or
OCI, and excluded from the income statement.  In 2007, other
comprehensive income of $32 million, after-tax, mainly included: gains of $257
million on hedge contracts designated for future periods, caused primarily by
changes in currency exchange rates, copper prices, gold prices and fuel prices;
reclassification adjustments totaling $185 million for gains on hedge contracts
designated for 2007 that were transferred to earnings in 2007; $71 million
transferred to earnings related to gains recorded on the sale of NovaGold and
Gold Fields shares, and $58 million recorded as a result of changes in the
fair value of investments held during the year.  Included in
accumulated other comprehensive income at December 31, 2007 were
unrealized pre-tax gains on currency hedge contracts totaling $356 million,
based on December 31, 2007 market foreign exchange rates. The related
hedge contracts are designated against operating costs and capital expenditures
primarily over the next three years and are expected to help protect against
the impact of the strengthening of the Australian and Canadian dollar against
the US dollar. The hedge gains are expected to be recorded in earnings at the
same time as the corresponding hedged operating costs and amortization of
capital expenditures are also recorded in earnings.  Credit
Rating  At February 21, 2008 from
  major rating agencies:Standard and Poors (S&P)
  
  AMoodys
  
  Baa1DBRS
  
  A  Through 2007, our
ratings, as established by S&P, Moodys and DBRS, have remained stable. Our
ability to access unsecured debt markets and the related cost of debt financing
is, in part, dependent upon maintaining an acceptable credit rating.
Deterioration in our credit rating would not adversely affect existing debt
securities, but could impact funding costs for any new debt financing. The key
factors impacting our credit rating include the following: our market
capitalization; the strength of our balance sheet, including the amount of net
debt and our debt-to-equity ratio; our net cash flow, including cash generated
by operating activities and expected capital expenditure requirements; the
quantity of our gold reserves; and our geopolitical risk profile.  Off
Balance Sheet Arrangements  Financial Instruments  We
use a mixture of cash and long-term debt to maintain an efficient capital
structure and ensure adequate liquidity exists to meet the cash needs of our
business. A discussion of our liquidity and capital structure can be found on pages 55
to 56. We use interest rate contracts to mitigate interest rate risk that is
implicit in our cash balances and outstanding long-term debt. In the normal
course of business, we are inherently exposed to currency and commodity price
risk. We use currency and commodity hedging instruments to mitigate these
inherent business risks. We also hold certain derivative instruments that do
not qualify for hedge accounting treatment. These non-hedge derivatives are
described in note 20 to our Financial Statements. For a discussion of certain
risks and assumptions that relate to the use of derivatives, including market
risk, market liquidity risk and credit risk, refer to notes 2 and 20 to our
Financial Statements. For a discussion of the methods used to value financial
instruments, as well as any significant assumptions, refer to note 20 to our
Financial Statements.  57


Summary
of Financial Instruments(1)  As at and for the year
ended December 31, 2007  Financial
  Instrument
  
  Principal/
  Notional
  Amount
  
  Associated
  Risks
  
  Amounts
  Recorded
  in Earnings
  
  Amounts
  Recorded
  in OCICash and equivalents
  
  $
  2,207 million
  
  ·Interest
  rate
  ·Credit
  
  $
  138 million
  
  Investments in available-for-sale
  securities
  
  $
  142 million
  
  ·Market
  
  $
  71 million
  
  $
  41 millionLong-term debt
  
  $
  3,255 million
  
  ·Interest
  rate
  
  $
  113 million
  
  Hedging instruments  currency contracts
  
  C $
  450 million
  
  ·Market/Liquidity
  
  $
  190 million
  
  $
  264 millionA$
  4,518 millionCLP
  42 millionCopper hedges
  
  444 million lbs
  
  ·Market/Liquidity
  ·Credit
  
  $
  (32) million
  
  $
  14 millionAcquired Placer Dome gold hedges
  
  
  
  ·Market/Liquidity
  ·Credit
  
  $
  2 million
  
  $
  15 millionHedging instruments  fuel and propane
  contracts
  
  4.5 million bbls
  
  ·Market/Liquidity
  ·Credit
  
  $
  29 million
  
  $
  79 millionDebt hedging instruments  interest rate contracts
  
  
  
  ·Market/Liquidity
  ·Credit
  
  
  
  $
  (17) millionCash hedging instruments  interest rate
  contracts
  
  
  
  ·Market/Liquidity
  ·Credit
  
  $
  (3) million
  
  Non-hedge derivatives
  
  Various
  
  ·Market/Liquidity
  ·Credit
  
  $
  41 million
  
    
 (1)Refer to pages 58
to 59 for information on gold and silver sales contracts.  At December 31,
2006, Barricks Corporate Gold Sales Contracts totaled 2.5 million ounces. In
2007, we reduced the Corporate Gold Sales Contract book to zero.  Project
Gold Sales Contracts  In anticipation of
building our projects, and in support of any related financing, we have 9.5
million(1)ounces of
existing gold sales contracts specifically allocated to these projects. The
allocation of these contracts will help reduce gold price risk at the projects
and are expected to help secure financing for construction. We expect that the
allocation of these contracts will eliminate any requirement by lenders to add
any incremental gold sales contracts in the future to support any financing
requirements. The contracting parties are bullion banks whose business includes
entering into contracts to purchase gold from mining companies. The terms of
our gold and silver sales contracts enable us to deliver gold and silver
whenever we choose over the primarily ten-year term of the contracts. The
forward sales prices on our Project Gold Sales Contracts have not been fully
fixed, and thus remain sensitive to long-term interest rates. As part of our
Master Trading Agreements (MTAs), Project Gold Sales Contracts are not
subject to any provisions regarding any financial go-ahead decisions with
construction, or any possible delay or change in the project.  
 (1)Includes
floating spot-price gold contracts under which we are committed to deliver 1.7
million ounces of gold at spot prices less an average fixed-price adjustment of
$456 per ounce.  58


Key
Aspects of Project Gold Sales Contracts  As of December 31, 2007Expected delivery dates(1)
  
  20112019, the approximate terms of expected
  financingFuture estimated average realizable selling price(2)
  
  $435/ounceMark-to-market value at December 31, 2007(millions)(3)
  
  $(4,626)  
 (1)The contract
termination dates are in 2017 in most cases, but we currently expect to deliver
production against these contracts starting in 2011, subject to production
commencing at certain projects which is dependant on the timing of receipt of
approvals of the environmental impact assessments, as well as the resolution of
other external issues, both of which are largely beyond our control.  (2)Upon delivery
of production from 20112019, the term of expected financing. Approximate
estimated value based on current market US dollar interest rates and on an
average lease rate assumption of 0.75%.  (3)At a spot gold
price of $834 per ounce and market interest rates. Based on closing spot price
of $913 per ounce on February 15, 2008, the mark-to-market liability is
$(5,095).  The allocation of gold
sales contracts to projects involves: (i) the identification of contracts
in quantities and for terms that mitigate gold price risk for the project
during the term of the expected financing (contracts were chosen where the
existing termination dates are spread between the targeted first year of
production and the expected retirement of financing for the project); and (ii) the
eventual settlement of proceeds from these contracts for the benefit of
production.  Through allocation
of these gold sales contracts to these projects, we reduce capital risk. It
protects the gold price during the term of the forecasted financing, while
leaving the remaining reserves fully levered to spot gold prices.  Under the Project
Gold Sales Contracts, we have an obligation to deliver gold by the termination date
(currently 2017 in most cases). However, because we typically fix the price of
gold under our gold sales contracts to a date that is earlier than the
termination date of the contract (referred to as the interim price-setting
date), the actual realized price on the contract termination date depends upon
the actual gold market forward premium (contango) between the interim
price-setting date and the termination date. Therefore, the $435/oz price
estimate could change over time due to a number of factors, including, but not
limited to: US dollar interest rates, gold lease rates, spot gold prices and
extensions of the termination date. This price estimate, which is an average
for the total Project Gold Sales Contract position, is not necessarily representative
of the prices that may be realized for actual deliveries into gold sales
contracts, in particular, if we choose to settle any gold sales contract in
advance of the termination date (which we have the right to do at our
discretion). If we choose to accelerate gold deliveries, this would likely lead
to reduced contango that would otherwise have built up over time (and therefore
a lower realized price).  Contango is
typically closely correlated with the difference between US dollar interest
rates and gold lease rates. An increase or decrease in US dollar interest rates
would generally lead to a corresponding increase or decrease in contango, and
therefore an increase or decrease in the estimated future price of the contract
at the termination date. Furthermore, the greater the time period between the
interim price-setting date and the termination date, the greater the
sensitivity of the final realized price to US dollar interest rates.  A short-term spike
in gold lease rates would not have a material negative impact on us because we
are not significantly exposed under our Project Gold Sales Contracts to
short-term gold lease rate variations. A prolonged rise in gold lease rates
could result in lower contango (or negative contango, i.e. backwardation). Gold
lease rates have historically tended to be low, and any spikes short-lived,
because of the large amount of gold available for lending relative to demand.  Fixed-Price
Silver Sales Contracts  As of December 31, 2007Millions of silver ounces
  
  10.5Current termination date of silver sales contracts
  
  2017 in most casesAverage estimated realizable selling price at 2017
  termination date(1)
  
  $9.04Mark-to-market value at December 31, 2007(2)
  
  $(80)  
 (1)Approximate
estimated value based on current market contango of 2.50%. Accelerating silver
deliveries could potentially lead to reduced contango that would otherwise have
built up over time. Barrick may choose to settle any silver sales contract in
advance of this termination date at any time, at its discretion. Historically,
delivery has occurred in advance of the contractual termination date.  (2)At a spot
silver price of $14.76 per ounce.  59


We
also have floating spot-price silver sales contracts under which we are
committed to deliver 7.65 million ounces of silver over the next ten years at
spot prices, less an average fixed-price adjustment of $4.06 per ounce. These
floating spot-price contracts were previously fixed-price contracts, for which,
under the price-setting mechanisms of the MTAs, we elected to receive a price
based on the market silver spot price at the time of delivery, adjusted by the
difference between the spot price and the contract price at the time of such
election.  Key Terms of Gold and Silver Sales Contracts  In
all of our MTAs, which govern the terms of gold and silver sales contracts with
our 18 counterparties, the following applies.  ·The
counterparties do not have unilateral and discretionary right to break
provisions.  ·There are no credit downgrade provisions.  ·We are not subject to any margin calls,
regardless of the price of gold or silver.  ·We have the right to settle our gold and
silver sales contracts on two days notice at any time during the life of the
contracts, or keep these forward gold and silver sales contracts outstanding
for up to 10 years.  ·At our option, we can sell gold or silver at
the market price or the contract price, whichever is higher, up to the
termination date of the contracts (currently 2017 in most cases).  The
MTAs with our counterparties do provide for early close out of certain
transactions in the event of a material adverse change in our ability, or our
principal hedging subsidiarys ability, to perform our or its gold and silver
delivery and other obligations under the MTAs and related parent guarantees, a
lack of gold or silver market and for customary events of default such as
covenant breaches, insolvency or bankruptcy. The principal financial covenants
are:  ·We must maintain a minimum consolidated net
worth of at least $2 billion; it was $15 billion at year end. The MTAs exclude
unrealized mark-to-market valuations in the calculation of consolidated net
worth.  ·We must maintain a maximum
long-term debt to consolidated net worth ratio of less than 2:1; we have
consistently been below 1:1 for the entire year.  In
most cases, under the terms of the MTAs, the period over which we are required
to deliver gold is extended annually by one year, or kept evergreen,
regardless of the intended delivery dates, unless otherwise notified by the
counterparty. This means that, with each year that passes, the termination date
of most MTAs is extended into the future by one year.  As spot gold prices increase or decrease, the value of our gold mineral
reserves and amount of potential operating cash inflows generally increase or
decrease. The unrealized mark-to-market loss on our fixed-price gold sales
contracts also increases or decreases. The mark-to-market value represents the
cancellation value of these contracts based on current market levels, and does
not represent an immediate economic obligation for payment by us. Our
obligations under the project gold sales contracts are to deliver an agreed
upon quantity of gold at a contracted price by the termination date of the
contracts (currently 2017 in most cases). Project Gold Sales Contracts are not
recorded on our balance sheet. The economic impact of these contracts is
reflected in our Financial Statements within gold sales based on selling prices
under the contracts at the time we record revenue from the physical delivery of
gold and silver under the contracts.  Fair Value of Derivative Positions  As at December 31, 2007
  ($ millions)
  
  Unrealized
  Gain/(Loss)Project Gold Sales Contracts
  
  $
  (3,888
  )Floating Spot-Price Gold Sales Contracts
  
  (738
  )Silver Sales Contracts
  
  (80
  )Floating Spot-Price Silver Sales Contracts
  
  (31
  )Foreign currency contracts
  
  241Interest rate and gold lease contracts
  
  (10
  )Fuel contracts
  
  84Copper contracts
  
  74Total
  
  $
  (4,348
  )  60


Critical
Accounting Policies and Estimates  Management
has discussed the development and selection of our critical accounting
estimates with the Audit Committee of the Board of Directors, and the Audit
Committee has reviewed the disclosure relating to such estimates in conjunction
with its review of this MD&A. The accounting policies and methods we
utilize determine how we report our financial condition and results of operations,
and they may require management to make estimates or rely on assumptions about
matters that are inherently uncertain.  Our financial condition and results of operations are reported using
accounting policies and methods prescribed by US GAAP. In certain cases, US
GAAP allows accounting policies and methods to be selected from two or more
alternatives, any of which might be reasonable yet result in our reporting
materially different amounts. We exercise judgment in selecting and applying
our accounting policies and methods to ensure that, while US GAAP compliant,
they reflect our judgment of an appropriate manner in which to record and
report our financial condition and results of operations.  Internal
Control over Financial Reporting  Management
is responsible for establishing and maintaining adequate internal control over
financial reporting. Internal control over financial reporting is a process
designed to provide reasonable assurance regarding the reliability of financial
reporting and the preparation of financial statements for external purposes in
accordance with US GAAP.  The Companys internal control over financial reporting includes those
policies and procedures that (i) pertain to the maintenance of records
that, in reasonable detail, accurately and fairly reflect the transactions and
dispositions of the assets of the Company; (ii) provide reasonable
assurance that transactions are recorded as necessary to permit preparation of
financial statements in accordance with US GAAP, and that receipts and
expenditures of the Company are being made only in accordance with
authorizations of management and directors of the Company; and (iii) provide
reasonable assurance regarding prevention ortimely detection of unauthorized acquisition,
use or disposition of the Companys assets that could have a material effect on
the Companys Financial Statements. Due to its inherent limitations, internal
control over financial reporting may not prevent or detect all misstatements.
Also, projections of any evaluation of effectiveness to future periods are
subject to the risk that controls may become inadequate because of changes in
conditions, or that the degree of compliance with the policies or procedures
may change.  Barricks annual management report on internal control over financial
reporting and the integrated audit report of Barrick auditors for the year
ended December 31, 2007 will be included in Barricks 2007 Annual Report
and its 2007 Form 40-F/Annual Information Form on file with the SEC
and Canadian provincial securities regulatory authorities.  Accounting
Policy Changes in 2007  This
section includes a discussion of significant accounting changes that were
adopted in our 2007 Financial Statements.  FASB Interpretation No. 48, Accounting for
Uncertainty in Income
Taxes  an interpretation of FASB Statement No. 109 (FIN 48)  In
June 2006, the Financial Accounting Standards Board (FASB) issued FIN 48,
to create a single model to address accounting for uncertainty in tax
positions. FIN 48 clarifies the accounting for income taxes, by prescribing
that a minimum recognition threshold tax position is required to be met before
being recognized in the financial statements. FIN 48 also provides guidance on
de-recognition, measurement, classification, interest and penalties, accounting
in interim periods, disclosure and transition. FIN 48 is effective for fiscal
years beginning after December 15, 2006. We adopted the provisions of FIN
48 on January 1, 2007. As a result of the implementation of FIN 48, an
adjustment to the liability for unrecognized tax benefits was not required;
consequently there was no cumulative effect adjustment to the January 1,
2007 balance of retained earnings.  61


Future
Accounting Policy Changes  This
section includes a discussion of future accounting changes that may have a
significant impact on our Financial Statements.  FAS 157, Fair Value Measurements (FAS 157)  In
September 2006, the FASB issued FAS 157 that provides enhanced guidance
for using fair value to measure assets and liabilities. FAS 157 is meant to
ensure that the measurement of fair value is more comparable and consistent,
and improve disclosure about fair value measures. As a result of FAS 157 there
is now a common definition of fair value to be used throughout US GAAP. FAS 157
applies whenever US GAAP requires (or permits) measurement of assets or
liabilities at fair value. FAS 157 does not address when the use of fair value
measurements is required.  In December 2007, the FASB issued FSP FAS 157-b, which provided a
one year deferral for the implementation of FAS 157 for non-financial assets
and liabilities. The deferral is intended to provide the FASB additional time
to consider the effects of various implementation issues that have arisen, or
that may arise, from the application of FAS 157. Barrick is required to
implement the FAS 157 for financial assets and liabilities that are carried at
fair value effective January 1, 2008. We do not expect the adoption of FAS
157 to have any significant impact on valuations of investments or derivative
instruments.  FAS 141(R), Business Combinations (FAS 141(R))  In
December 2007, the FASB issued FAS 141(R), which will replace FAS 141
prospectively effective for business combinations consummated after the
effective date of December 15, 2008. Early adoption is not permitted.
Under FAS 141(R), business acquisitions will be accounted for under the
acquisition method, compared to the purchase methodmandated by FAS 141.  The more significant changes to Barricks accounting for business
combinations that will result from applying the acquisition method include: (i) the
definition of a business is broadened to include development stage entities,
and therefore more acquisitions will be accounted for as business combinations
rather than asset acquisitions; (ii) the measurement date for equity
interests issued by the acquirer is the acquisitiondate instead of a few days before and after
terms are agreed to and announced, which may significantly change the amount
recorded for the acquired business if share prices differ from the agreement
and announcement date to the acquisition date; (iii) all future
adjustments to income tax estimates will be recorded to income tax expense,
whereas under FAS 141 certain changes in income tax estimates were recorded to
goodwill; (iv) acquisition-related costs of the acquirer, including
investment banking fees, legal fees, accounting fees, valuation fees, and other
professional or consulting fees will be expensed as incurred, whereas under FAS
141 these costs are capitalized as part of the business combination; (v) the
assets acquired and liabilities assumed are recorded at 100% of fair value even
if less than 100% is obtained, whereas under FAS 141 only the controlling interests
portion is recorded at fair value; and (vi) the non-controlling interest
will be recorded at its share of fair value of net assets acquired, including
its share of goodwill, whereas under FAS 141 the non-controlling interest is
recorded at its share of carrying value of net assets acquired with no goodwill
being allocated.  FAS 160, Non-controlling Interests in  Consolidated Financial
Statements (FAS 160)  In
December 2007, the FASB issued FAS 160, which is effective for fiscal
years beginning after December 15, 2008. Under FAS 160, the
non-controlling interest will be measured at 100% of the fair value of assets
acquired and liabilities assumed. Under current standards, the non-controlling
interest is measured at book value. For presentation and disclosure purposes,
non-controlling interests will be classified as a separate component of
shareholders equity. In addition, FAS 160 will change the manner in which
increases/ decreases in ownership percentages are accounted for. Changes in
ownership percentages will be recorded as equity transactions and no gain or
loss will be recognized as long as the parent retains control of the
subsidiary. When a parent company deconsolidates a subsidiary but retains a
non-controlling interest, the non-controlling interest is re-measured at fair
value on the date control is lost and a gain or loss is recognized at that
time. Finally, under FAS 160, accumulated losses attributable to the
non-controlling  62


interests are no longer
limited to the original carrying amount, and therefore non-controlling
interests could have a negative carrying balance. The provisions of FAS 160 are
to be applied prospectively with the exception of the presentation and
disclosure provisions, which are to be applied for all prior periods presented
in the financial statements. Early adoption is not permitted.  Critical
Accounting Estimates and Judgments  Certain
accounting estimates have been identified as being critical to the
presentation of our financial condition and results of operations because they
require us to make subjective and/or complex judgments about matters that are
inherently uncertain; or there is a reasonable likelihood that materially
different amounts could be reported under different conditions or using
different assumptions and estimates.  Reserve Estimates
Used to Measure Amortization of Property, Plant and Equipment  We
record amortization expense based on the estimated useful economic lives of
long-lived assets. Changes in reserve estimates are generally calculated at the
end of each year and cause amortization expense to increase or decrease
prospectively. The estimate that most significantly affects the measurement of
amortization is quantities of proven and probable gold and copper reserves,
because we amortize a large portion of property, plant and equipment using the
units-of-production method. The estimation of quantities of gold and copper
reserves, in accordance with the principles in Industry Guide No. 7,
issued by the US Securities and Exchange Commission (SEC) is complex,
requiring significant subjective assumptions that arise from the evaluation of
geological, geophysical, engineering and economic data for a given ore body.
This data could change over time as a result of numerous factors, including new
information gained from development activities, evolving productionhistory and a reassessment of the viability
of production under different economic conditions. Changes in data and/or
assumptions could cause reserve estimates to substantially change from period
to period. Actual gold and copper production could differ from expected gold
and copper production based on reserves, and an adverse change in gold or
copper prices could make a reserve uneconomic to mine. Variations could also
occur in actual ore grades and gold, silver and copper recovery rates from
estimates.  A key trend that could reasonably impact reserve estimates is rising
market mineral prices, because the mineral price assumption is closely related
to the trailing three-year average market price. As this assumption rises, it
could result in an upward revision to reserve estimates as material not
previously classified as a reserve becomes economic at higher gold prices.
Following the recent trend in market gold prices over the last three years, the
mineral price assumption used to measure reserves has also been rising. The
gold price assumption was $575 per ounce in 2007 (2006: $475 per ounce; 2005:
$400 per ounce). The copper price assumption was $2.00 per pound in 2007 (2006:
$1.75 for Osborne and $1.50 for all other copper reserves).  The impact of a change in reserve estimates is generally more
significant for mines near the end of the mine life because the overall impact
on amortization is spread over a shorter time period. Also, amortization
expense is more significantly impacted by changes in reserve estimates at
underground mines than open-pit mines due to the following factors: (1) underground
development costs incurred to access ore at underground mines are significant
and amortized using the units-of-production method; and(2) reserves at underground mines are
often more sensitive to mineral price assumptions and changes in production
costs. Production costs at underground mines are impacted by factors such as
dilution, which can significantly impact mining and processing costs per ounce.  63


Impact of Historic
Changes in Reserve Estimates on Amortization  For the years ended December 31
  ($ millions, except reserves in millions of contained oz/pounds)
  
  2007
  
  2006Reserves
  increase
  (decrease)(1)
  
  Amortization
  increase
  (decrease)
  
  Reserves
  increase
  (decrease)(1)
  
  Amortization
  increase
  (decrease)GoldNorth America
  
  5.0
  
  $
  3
  
  1.7
  
  $
  (6
  )South America
  
  0.1
  
  23
  
  0.1
  
  (35
  )Australia Pacific
  
  3.5
  
  (2
  )
  0.6
  
  (16
  )Africa
  
  0.5
  
  (2
  )
  3.0
  
  (18
  )Total Gold
  
  9.1
  
  $
  22
  
  5.4
  
  $
  (75
  )CopperAustralia Pacific
  
  89
  
  (6
  )
  
  
  South America
  
  255
  
  10
  
  
  
  Total Copper
  
  344
  
  $
  4
  
  
  
  $
    
 (1)Each year we
update our reserve estimates as at the end of the year as part of our normal
business cycle. Reserve changes presented were calculated at the beginning of
the applicable fiscal year and are in millions of contained ounces.  Impairment
Assessments of Operating Mines and Development Projects  We review and test the
carrying amounts of assets when events or changes in circumstances suggest that
the carrying amount may not be recoverable. We group assets at the lowest level
for which identifiable cash flows are largely independent of the cash flows of
other assets and liabilities. For operating mines and development projects, all
assets related to a mine or project are included in one group. If there are
indications that impairment may have occurred at a particular mine site, we
compare the sum of the undiscounted cash flows expected to be generated from
that mine or project to its carrying amount. If the sum of undiscounted cash
flows is less than the carrying amount, an impairment loss is recognized if the
carrying amount of the individual long-lived assets within the group exceeds
their fair values.  Long-lived assets
subject to potential impairment at operating mines and development projects
include buildings, plant and equipment, and capitalized mineral property
acquisition and mine development costs. For impairment assessment purposes, the
estimated fair value of buildings, plant and equipment is based on a
combination of current depreciated replacement cost and current market value.
The estimated fair value of capitalized mineral property acquisition and mine
development costs is based on a discounted cash flow model.  In fourth quarter
2007, Eskay Creek and Golden Sunlight were identified as having potential
impairments. As a result, we compared the estimated fair value of the
long-lived assets at Golden Sunlight and Eskay Creek to their carrying amount
and determined that the fair value of the long-lived assets exceeded their
carrying amounts.  Impairment
Assessments of Exploration Projects  After acquisition,
various factors can affect the recoverability of the capitalized cost of land
and mineral rights, particularly the results of exploration drilling. The
length of time between the acquisition of land and mineral rights and when we
undertake exploration work varies based on the prioritization of our
exploration projects and the size of our exploration budget. If we conclude
that an impairment may exist, we compare the carrying amount to its fair value.
The fair value for exploration projects is based on a discounted cash flow
model. For projects that do not have reliable cash flow projections, a market
approach is applied. In the event land and mineral rights are impaired, we
reduce the carrying amount to the estimated fair value and an impairment loss
is recognized.  64


Accounting
for Goodwill and Goodwill Impairment  We allocate goodwill
arising from business combinations to reporting units acquired by preparing
estimates of the fair value of the entire reporting unit and comparing this
amount to the fair value of assets and liabilities (including intangibles) in
the reporting unit. The difference represents the amount of goodwill allocated
to each reporting unit. We believe that goodwill arises principally because of
the following factors: (1) the going concern value implicit in the
Companys ability to sustain/grow its business by increasing reserves and
resources through new discoveries whose potential value was not identified at
the time of acquisition; and (2) the ability to capture unique synergies
from a business combination that can be realized from managing a portfolio of
mines and mineral properties in the same geographic region.  We test for
impairment of goodwill on an annual basis and at any other time if events or a
change in circumstances indicate that it is more likely than not that the fair
value of a reporting unit has been reduced below its carrying amount.
Circumstances that could trigger an impairment test include, but are not
limited to: a significant adverse change in the business climate or legal
factors; an adverse action or assessment by a regulator; the likelihood that a
reporting unit or a significant portion of a reporting unit will be sold or
otherwise disposed of; adverse results of testing for recoverability of a
significant asset group within a reporting unit; and a significant change to
the operating plans for the reporting unit. The impairment test for goodwill is
a two-step process. Step one consists of a comparison of the fair value of a
reporting unit to its carrying amount, including the allocated goodwill. If the
carrying amount of the reporting unit exceeds the fair value, step two requires
the fair value of the reporting unit to be allocated to the underlying assets
and liabilities of that reporting unit, resulting in an implied fair value of
goodwill. If the carrying amount of the reporting unit goodwill exceeds the
implied fair value of that goodwill, we record an impairment charge equal to
the excess.  In 2006, we
determined that goodwill should be allocated to reporting units that would
either represent components (individual mineral properties) or aggregations of
components up to a regional business unit level. As at December 31, 2006,
the process of determining the appropriate level to allocate goodwill was
ongoing. In fourth quarter 2006, we completed impairment tests of goodwill
assuming both no aggregation of mineral properties, and aggregation of mineral
properties up to the regional business unit level and determined that there was
no impairment at that date under either scenario. In second quarter 2007, we
determined that each individual mineral property, that is an operating mine, is
a reporting unit for the purposes of allocating goodwill. On this basis, we
allocated goodwill arising from the Placer Dome acquisition to both acquired
and existing mineral properties. Future impairment testing will be completed at
that level.  Goodwill was
allocated to acquired mineral properties considering the values of mineral
properties exclusive of synergies between Barrick and Placer Dome. In addition,
synergy values were allocated to all mineral properties, both existing and
acquired, expected to benefit from the combination of the two companies.
Allocating goodwill to individual mineral properties, which by their very
nature have a limited useful life, will result in future goodwill impairment
charges by the end of the mine life. The timing and amount of future goodwill
impairment charges is difficult to determine and will be dependent on a
multitude of factors that impact valuations of mineral properties, including
changes in observed market multiples for valuation purposes, changes in
geopolitical risk and country specific discount rates, changes in market gold
prices and total cash costs, success in finding new reserves, future
exploration potential and future capital requirements.  65


Gold mining
companies typically trade at a market capitalization that is based on a
multiple of net asset value (NAV), whereby NAV represents a discounted cash
flow valuation based on projected future cash flows. For goodwill impairment
testing purposes, we estimate the fair value of a gold property by applying a
multiple to the reporting units NAV, which is calculated based on projected
cash flows from its most recent life of mine plan. For copper properties, the
estimated fair value is based on their NAV and no multiple is applied. The
process for determining these fair values is subjective and requires management
to make estimates and assumptions including, but not limited to, projected
future revenues (based on estimates of production and long-term metals prices),
operating expenses, capital expenditures, remaining economic life of individual
mineral properties, discount rates and NAV multiples. These estimates and
assumptions are subject to change in the future due to uncertain competitive
and market conditions or changes in business strategies. The projected future
revenues, operating expenses, capital investment and estimated economic life
for each individual mineral property is based on internal life of mine plans
prepared for each property that we update in the fourth quarter of each fiscal
year. Discount rates are based on a country-level real weighted average cost of
capital. For individual mineral properties, the NAV multiple considers the
median and/or average of observed multiples for comparable public gold
companies with operations in similar geographic areas, as well as the
propertys remaining economic life. In particular, our assumptions with respect
to long-term gold prices and the appropriate NAV multiple to apply have a
significant impact on our estimate of fair value. In fourth quarter 2007, we
completed our annual goodwill impairment test using a long-term gold price of
$800 per ounce and applying NAV multiples ranging from 1.0 to 2.0 depending on
each propertys geographic location and remaining economic life. Based on this
analysis, we recorded a goodwill impairment charge of $35 million at our Golden
Sunlight mine and $7 million at our Eskay Creek mine. The goodwill charges at
these mines are primarily a result of their short remaining economic lives of
less than 1 year. No goodwill remains at our Eskay Creek mine and $9 million in
goodwill remains at Golden Sunlight.  Individual mineral
properties are wasting assets. Consequently, properties with a short remaining
economic life are at a greater risk of incurring a near-term goodwill
impairment charge. Based on our most recent life of mine plans, our Tulawaka,
Henty, Pierina and Granny Smith mines have remaining economic lives of three
years or less. The aggregate goodwill for these mineral properties is
approximately $190 million.  Production
Start Date  We assess each mine
construction project to determine when a mine moves into production stage. The
criteria used to assess the start date are determined based on the unique
nature of each mine construction project, such as the complexity of a plant or
its location. We consider various relevant criteria to assess when the mine is
substantially complete and ready for its intended use and moved into production
stage. Some of the criteria considered would include, but are not limited to,
the following: (1) the level of capital expenditures compared to
construction cost estimates; (2) completion of a reasonable period of
testing of mine plant and equipment; (3) ability to produce minerals in
saleable form (within specifications); and (4) ability to sustain ongoing
production of minerals.  When a mine
construction project moves into the production stage, the capitalization of
certain mine construction costs ceases and costs are either capitalized to
inventory or expensed, except for capitalizable costs related to property,
plant and equipment additions or improvements, underground mine development or
reserve development.  Fair
Value of Asset Retirement Obligations (AROs)  AROs arise from the
acquisition, development, construction and normal operation of mining property,
plant and equipment, due to government controls and regulations that protect
the environment and public safety on the closure and reclamation of mining
properties. We record the fair value of an ARO in our Financial Statements when
it is incurred and capitalize this amount as an increase in the carrying amount
of the related asset. At operating mines, the increase in an ARO is recorded as
an adjustment to the corresponding asset carrying amount and results in a
prospective increase in amortization expense. At closed mines, any adjustment
to an ARO is charged directly to earnings.  66


The fair values of
AROs are measured by discounting the expected cash flows using a discount
factor that reflects the credit-adjusted risk-free rate of interest. We prepare
estimates of the timing and amounts of expected cash flows when an ARO is
incurred, which are updated to reflect changes in facts and circumstances, or
if we are required to submit updated mine closure plans to regulatory
authorities. In the future, changes in regulations or laws or enforcement could
adversely affect our operations; and any instances of non-compliance with laws
or regulations that result in fines or injunctions or delays in projects, or
any unforeseen environmental contamination at, or related to, our mining
properties, could result in us suffering significant costs. We mitigate these
risks through environmental and health and safety programs under which we
monitor compliance with laws and regulations and take steps to reduce the risk
of environmental contamination occurring. We maintain insurance for some
environmental risks, however, for some risks, coverage cannot be purchased at a
reasonable cost. Our coverage may not provide full recovery for all possible
causes of loss. The principal factors that can cause expected cash flows to
change are: the construction of new processing facilities; changes in the
quantities of material in reserves and a corresponding change in the life of
mine plan; changing ore characteristics that ultimately impact the environment;
changes in water quality that impact the extent of water treatment required;
and changes in laws and regulations governing the protection of the
environment. In general, as the end of the mine life nears, the reliability of
expected cash flows increases, but earlier in the mine life, the estimation of
an ARO is inherently more subjective. Significant judgments and estimates are
made when estimating the fair value of AROs. Expected cash flows relating to
AROs could occur over periods up to 40 years and the assessment of the extent
of environmental remediation work is highly subjective. Considering all of
these factors that go into the determination of an ARO, the fair value of AROs
can materially change over time.  At our operating
mines, we continue to record AROs based on disturbance of the environment over
time. It is reasonably possible that circumstances could arise during or by the
end of the mine life that will require material revisions to AROs. In
particular, the extent of water treatment can have a material effect on the
fair value of AROs, and the expected water quality at the end of the mine life,
which is the primary driver of the extent of water treatment, can change
significantly. We periodically prepare updated studies for our mines, following
which it may be necessary to adjust the fair value of AROs. The period of time
over which we have assumed that water quality monitoring and treatment will be
required has a significant impact on AROs at closed mines. The amount of AROs
recorded reflects the expected cost, taking into account the probability of
particular scenarios. The difference between the upper end of the range of
these assumptions and the lower end of the range can be significant, and
consequently changes in these assumptions could have a material effect on the
fair value of AROs and future earnings in a period of change.  At one closed
mine, the principal uncertainty that could impact the fair value of the ARO is
the manner in which a tailings facility will need to be remediated. In
measuring the ARO, we have concluded that there are two possible methods that
could be used. We have recorded the ARO using the more costly method until such
time that the less costly method can be proven as technically feasible and
approved.  AROs at
December 31, 2007  ($ millions)
  
  2007
  
  2006Operating mines
  
  $
  769
  
  $
  683Closed mines
  
  197
  
  200Development projects
  
  
  
  10Total
  
  $
  966
  
  $
  893  67


Deferred
Tax Assets and Liabilities  Measurement
of Temporary Differences  We are periodically
required to estimate the tax basis of assets and liabilities. Where applicable
tax laws and regulations are either unclear or subject to varying
interpretations, it is possible that changes in these estimates could occur
that materially affect the amounts of deferred income tax assets and
liabilities recorded in our Financial Statements. Changes in deferred tax
assets and liabilities generally have a direct impact on earnings in the period
of changes.  Valuation
Allowances  Each period, we evaluate
the likelihood of whether some portion or all of each deferred tax asset will
not be realized. This evaluation is based on historic and future expected
levels of taxable income, the pattern and timing of reversals of taxable
temporary timing differences that give rise to deferred tax liabilities, and
tax planning activities. Levels of future taxable income are affected by, among
other things, market gold prices, and production costs, quantities of proven
and probable gold and copper reserves, interest rates and foreign currency
exchange rates. If we determine that it is more likely than not (a likelihood
of more than 50%) that all or some portion of a deferred tax asset will not be
realized, then we record a valuation allowance against the amount we do not
expect to realize. Changes in valuation allowances are recorded as a component
of income tax expense or recovery for each period. The most significant recent
trend impacting expected levels of future taxable income and the amount of
valuation allowances, has been rising gold and copper prices. A continuation of
this trend could lead to the release of some of the valuation allowances
recorded, with a corresponding effect on earnings in the period of release.  In 2007, we
released $156 million of an end of year valuation allowance in Tanzania due to
the estimated effect of higher market gold prices on the ability to utilize
deferred tax assets. We released other valuation allowances during 2007
totaling $88 million, partly because sources of income became available that
enabled tax losses to be realized.  In 2006, we
released $25 million of valuation allowances in the United States due to the
estimated effect of higher market gold prices on the ability to utilize
deferred tax assets. Also in 2006, we released $9 million of valuation
allowances in a Chilean entity due to the availability of income, and we
released valuation allowances of $19 million in Canada, reflecting utilization
of capital losses.  In 2005, we
released valuation allowances totaling $31 million in Argentina relating to the
effect of the higher gold price environment and the anticipated commencement of
sales in 2006. We released valuation allowances of $2 million in Canada
reflecting utilization of capital losses.  Valuation
Allowances at December 31  ($ millions)
  
  2007
  
  2006United States
  
  $
  190
  
  $
  211Chile
  
  105
  
  110Argentina
  
  26
  
  46Canada
  
  55
  
  59Tanzania
  
  30
  
  217Other
  
  13
  
  15Total
  
  $
  419
  
  $
  658  United States:most of the valuation allowances relate to Alternative Minimum (AMT) Tax
credits, which have an unlimited carry-forward period. Increasing levels of
future taxable income due to higher gold selling prices and other factors and
circumstances may result in our becoming a regular taxpayer under the US
regime, which may cause us to release some, or all, of the valuation allowance
on the AMT credits.  Chile, Argentina and Tanzania:the valuation allowances relate to the full
amount of tax assets in subsidiaries that do not have any present sources of
gold production or taxable income. In the event that these subsidiaries have
sources of taxable income in the future, we may release some or all of the
valuation allowances.  Canada:substantially all of the valuation allowances relate to capital losses
that can only be utilized if any capital gains are realized.  68


Non-GAAP Operating
Performance Measures  Adjusted
Net Income and Adjusted Operating Cash Flow  Adjusted net income,
adjusted net income per share, adjusted operating cash flow and adjusted
operating cash flow per share, each exclude the impact of deliveries into
Corporate Gold Sales Contracts. These are non-GAAP financial measures.
Management uses these measures internally to better assess performance trends
for the Company as a whole. Management understands that a number of investors
and others who follow the Companys performance also assess performance in this
way. Barricks elimination of all its remaining Corporate Gold Sales Contracts
in the first half of 2007 resulted in an unusually large opportunity cost of
$623 million. Management believes that these measures better reflect Barricks
performance for the current period and are a better indication of its expected
performance in future periods. Barrick managements budgeting, operational and
capital investment decisions are based on production being sold at an assumed
spot price, rather than the price under the Corporate Gold Sales Contracts. The
presentation of these performance measures enable investors to understand performance
based on selling gold production at spot market prices, which is the method
expected from third quarter 2007 onwards. Adjusted net income, adjusted net
income per share, adjusted operating cash flow and adjusted operating cash flow
per share are intended to provide additional information, do not have any
standardized meaning prescribed by US GAAP and should not be considered in
isolation or as a substitute for measures of performance prepared in accordance
with US GAAP. The measures are not necessarily indicative of operating profit
or cash flow from operations as determined under US GAAP. Other companies may
calculate these measures differently. The following table reconciles these
non-GAAP measures to the most directly comparable US GAAP measure.  Reconciliation of Net Income to
Adjusted Net Income and Operating Cash Flow to Adjusted Operating Cash Flow  ($ millions, except per share amounts in dollars)
  For the years ended December 31
  
  2007
  
  2006
  
  2005Net income from continuing operations
  
  $
  1,110
  
  $
  1,209
  
  $
  395Impact of elimination of Corporate Gold
  Sales Contracts
  
  623
  
  352
  
  55Adjusted net income from continuing
  operations
  
  $
  1,733
  
  $
  1,561
  
  $
  450Earnings per share from continuing
  operations(1)
  
  $
  1.28
  
  $
  1.44
  
  $
  0.74Impact of elimination of Corporate Gold
  Sales Contracts
  
  0.72
  
  0.42
  
  0.10Adjusted net income per share from
  continuing operations(1)
  
  $
  2.00
  
  $
  1.86
  
  $
  0.84Operating cash flow from continuing
  operations
  
  $
  1,732
  
  $
  2,122
  
  $
  726Impact of elimination of Corporate Gold
  Sales Contracts
  
  636
  
  367
  
  56Adjusted operating cash flow from
  continuing operations
  
  $
  2,368
  
  $
  2,489
  
  $
  782Operating cash flow per share from
  continuing operations(1)
  
  $
  2.00
  
  $
  2.52
  
  $
  1.35Impact of elimination of Corporate Gold
  Sales Contracts
  
  0.73
  
  0.44
  
  0.10Adjusted operating cash flow per share from
  continuing operations(1)
  
  $
  2.73
  
  $
  2.96
  
  $
  1.45  
 (1)   Calculated using net income and weighted
average number of shares outstanding under the Basic method of earnings per
share.  69


EBITDA and
Adjusted EBITDA  EBITDA, adjusted EBITDA,
EBITDA per share and adjusted EBITDA per share are non-GAAP financial measures.
EBITDA and EBITDA per share represent net income, excluding income tax expense,
interest expense, interest income and amortization. Adjusted EBITDA and
adjusted EBITDA per share represents net income, excluding income tax expense,
interest expense, interest income and amortization, adjusted to reflect the
impact of the deliveries into Corporate Gold Sales Contracts. We believe that
EBITDA, adjusted EBITDA, EBITDA per share and adjusted EBITDA per share trends
are valuable indicators of whether our operations are able to produce
sufficient operating cash flow to fund working capital needs, to service our
debt obligations, and to fund capital expenditures. We currently use the
results depicted by EBITDA, adjusted EBITDA, EBITDA per share and adjusted
EBITDA per share for these purposes. EBITDA, adjusted EBITDA, EBITDA per shares
and adjusted EBITDA per share are intended to provide additional information,
do not have any standardized meaning prescribed by US GAAP and should not be
considered in isolation or as a substitute for measures of performance prepared
in accordance with US GAAP. These measures are not necessarily indicative of
operating profit or cash flow from operations as determined under US GAAP.
Other companies may calculate these measures differently. The following table
reconciles these non-GAAP measures to the most directly comparable US GAAP
measure.  Reconciliation of
Net Income to EBITDA and Adjusted EBITDA  ($ millions, except per share amounts in dollars)
  For the years ended December 31
  
  2007
  
  2006
  
  2005Net income from continuing operations
  
  $
  1,110
  
  $
  1,209
  
  $
  401Income taxes
  
  (341
  )
  (348
  )
  (60
  )Interest expense
  
  (113
  )
  (126
  )
  (3
  )Interest income
  
  141
  
  110
  
  38Amortization
  
  1,004
  
  735
  
  427EBITDA from continuing operations
  
  $
  2,427
  
  $
  2,308
  
  $
  847per share(1)
  
  2.80
  
  2.74
  
  1.58Impact of elimination of Corporate Gold
  Sales Contracts
  
  636
  
  367
  
  56Adjusted EBITDA from continuing
  operations(1)
  
  3,063
  
  2,675
  
  903per share(2)
  
  $
  3.53
  
  $
  3.18
  
  $
  1.68  
 (1)Calculated
using EBITDA and weighted average number of shares outstanding under the Basic
method of earnings per share.  (2)Calculated
using adjusted EBITDA and weighted average number of shares outstanding under
the Basic method of earnings per share.  Realized Prices  Management uses a
performance measure internally that represents revenues under US GAAP, adjusted
for unrealized gains and losses on non-hedge derivatives. The use of this
measure is intended to enable management to better understand the price
realized each period for gold and copper sales. Management believes that this
measure better reflects Barricks performance in each period and is a better
indication of its expected performance in future periods. Changes in the
unrealized mark-to-market value of non-hedge gold and copper derivatives occur
each period due to changes in market factors such as spot and forward gold and
copper prices. The exclusion of such unrealized mark-to-market gains and losses
from the presentation of this performance measure enables investors to
understand performance based on the realized proceeds of selling gold and
copper production. Management includes such unrealized mark-to-market gains and
losses in a list of special items that have affected its results. These gains
and losses relate to derivative instruments that mature in future periods, at
which time the gains and losses will become realized. The amounts of these
gains and losses reflect fair values based on market valuation assumptions at
the end of each period and do not necessarily represent the amounts that will
become realized on maturity. Barricks realized price statistics, excluding
unrealized mark-to-market value of non-hedge gold and copper derivatives, are
intended to provide additional information, do not have any standardized
meaning prescribed by US GAAP and should not be considered in isolation or as a
substitute for measures of performance prepared in accordance with US GAAP. The
measures are not necessarily indicative of operating profit or cash flow from
operations as determined under US GAAP. Other companies may calculate these
measures differently. The following table reconciles these non-GAAP measures to
the most directly comparable US GAAP measure.  70


Illustration of
Impact of Excluding Unrealized Gains and Losses on Non-Hedge Derivatives from
Realized Prices  ($ millions, except per ounce/pound data in dollars)
  
  Gold
  
  CopperFor the years ended December 31
  
  2007
  
  2006
  
  2005
  
  2007
  
  2006Sales(1)
  
  $
  5,027
  
  $
  4,493
  
  $
  2,348
  
  $
  1,305
  
  $
  1,137Sales attributable to non-controlling
  interests(2)
  
  (38
  )
  52
  
  (15
  )
  
  
  Sales  equity basis
  
  4,989
  
  4,545
  
  2,333
  
  1,305
  
  1,137Unrealized non-hedge gold/copper derivative
  (gains) losses
  
  (2
  )
  7
  
  
  
  (26
  )
  14Sales  equity basis, excluding non-hedge
  gold/copper derivative (gains) losses
  
  4,987
  
  4,552
  
  2,333
  
  1,279
  
  1,151Sales(thousands of ounces/millions lbs)
  
  8,055
  
  8,390
  
  5,320
  
  401
  
  376Realized gold/copper price per oz/lb
  (including unrealized non-hedge gold/copper derivative gains and losses)
  
  619
  
  542
  
  439
  
  3.25
  
  3.02Unrealized non-hedge gold/copper derivative
  (gains) losses  per ounce/pound
  
  
  
  1
  
  
  
  (0.06
  )
  0.04Realized gold/copper price per oz/lb
  (excluding unrealized non-hedge gold/copper derivative gains and losses)
  
  $
  619
  
  $
  543
  
  $
  439
  
  $
  3.19
  
  $
  3.06  
 (1)As
per Barricks income statement.  (2)Gold
sales include sales attributable to South Deep in 2006, included in discontinued
operations.  Total Cash Costs  Total cash costs per
ounce are a non-GAAP financial measure. Total cash costs per ounce include all
costs absorbed into inventory, as well as royalties, by-product credits,
production taxes and accretion expense, and exclude inventory purchase
accounting adjustments and amortization. The presentation of these statistics
in this manner allows us to monitor and manage those factors that impact
production costs on a monthly basis. We calculate total cash costs based on our
equity interest in production from our mines. Total cash costs per ounce/pound
are calculated by dividing the aggregate of these costs by gold ounces, copper
pounds sold or ore tons mined. Total cash costs and total cash costs per
ounce/pound are calculated on a consistent basis for the periods presented. In
our income statement, we present amortization separately from cost of sales.
Some companies include amortization in cost of sales, which results in a
different measurement of cost of sales in the income statement. We have
provided below reconciliations to illustrate the impact of excluding
amortization and inventory purchase accounting adjustments from total cash
costs per ounce/pound statistics. Under purchase accounting rules, we recorded
the fair value of acquired work in progress and finished goods inventories as
at the date of the Placer Dome acquisition. As the acquired inventory is sold,
any purchase accounting adjustments, reflected in the carrying amount of
inventory at acquisition, impacts cost of sales. The method of valuing these
inventories is based on estimated selling prices less costs to complete and a
reasonable profit margin. Consequently, the fair values do not necessarily
reflect costs to produce consistent with ore mined and processed into gold and
copper after the acquisition.  We believe that
using an equity interest presentation is a fairer, more accurate way to measure
economic performance than using a consolidated basis. For mines where we hold
less than a 100% share in the production, we exclude the economic share of gold
production that flows to our partners who hold a non-controlling interest.
Consequently, for the Tulawaka mine, although we fully consolidated this mine
in our Financial Statements, our production and total cash cost statistics only
reflect our equity share of the production.  71


In managing our
mining operations, we disaggregate cost of sales between amortization and the
other components of cost of sales. We use total cash costs per ounce/pound
statistics as a key performance measure internally to monitor the performance
of our regional business units. We use these statistics to assess how well our
regional business units are performing against internal plans, and also to
assess the overall effectiveness and efficiency of our mining operations. We
also use amortization costs per ounce/pound statistics to monitor business
performance. By disaggregating cost of sales into these two components and
separately monitoring them, we are able to better identify and address key
performance trends. We believe that the presentation of these statistics in
this manner in our MD&A, together with commentary explaining trends and
changes in these statistics, enhances the ability of investors to assess our
performance. These statistics also enable investors to better understand
year-over-year changes in cash production costs, which in turn affect our
profitability and ability to generate cash flow.  The principal
limitation associated with total cash costs per ounce/pound statistics is that
they do not reflect the total costs to produce gold/copper, which in turn
impacts the earnings of Barrick. We believe that we have compensated for this
limitation by highlighting the fact that total cash costs exclude amortization
and inventory purchase accounting adjustments as well as providing details of
the financial effect. We believe that the benefits of providing disaggregated
information outweigh the limitation in the method of presentation of total cash
costs per ounce/pound statistics.  Total cash costs
per ounce/pound statistics are intended to provide additional information, do
not have any standardized meaning prescribed by US GAAP and should not be
considered in isolation or as a substitute for measures of performance prepared
in accordance with US GAAP. The measures are not necessarily indicative of
operating profit or cash flow from operations as determined under US GAAP.
Other companies may calculate these measures differently.  72


Illustration
of Impact of Excluding Certain Costs from Total Cash Costs per Ounce/Pound  ($ millions, except per ounce/pound information in dollars)
  
  Gold
  
  Copper(1)For the years ended
  December 31
  
  2007
  
  2006
  
  2005
  
  2007
  
  2006Cost of sales(2)
  
  $
  2,842
  
  $
  2,348
  
  $
  1,198
  
  $
  342
  
  $
  393Cost of sales at South Deep included in
  discontinued operations
  
  
  
  101
  
  
  
  
  
  Cost of sales attributable to
  non-controlling interests(3)
  
  (15
  )
  (63
  )
  (8
  )
  
  
  Inventory purchase accounting adjustments
  included in cost of sales(4)
  
  
  
  (11
  )
  
  
  (9
  )
  (97
  )Cost of sales  equity basis
  
  2,827
  
  2,375
  
  1,190
  
  333
  
  296Amortization at producing mines 
  consolidated
  
  865
  
  648
  
  409
  
  119
  
  68Amortization at South Deep included in
  discontinued operations
  
  
  
  18
  
  
  
  
  
  Amortization at producing mines
  attributable to non-controlling interests(3)
  
  (6
  )
  (16
  )
  (5
  )
  
  
  Amortization at producing mines  equity
  basis
  
  859
  
  650
  
  404
  
  119
  
  68Inventory purchase accounting adjustments(4)
  
  
  
  11
  
  
  
  9
  
  97Cost of sales including amortization and
  inventory purchase accounting adjustments  equity basis
  
  $
  3,686
  
  $
  3,036
  
  $
  1,594
  
  $
  461
  
  $
  461  
 (1)The
2005 comparative periods for copper have been omitted as we did not produce any
significant amounts of copper prior to the production from the copper mines
acquired with Placer Dome.  (2)The
aggregate amount of cost of sales for gold and copper is as per Barricks
income statement.  (3)Relates
to a 70% interest in Tulawaka and a 50% interest in South Deep prior to 2007.  (4)Based
on our equity interest.  Total
Cash Costs per Ounce/Pound  (Per ounce/pound information in dollars)
  
  Gold
  
  Copper(1)For the years ended December 31
  
  2007
  
  2006
  
  2005
  
  2007
  
  2006Ounces/pounds sold  consolidated(thousands/millions)
  
  8,108
  
  8,566
  
  5,333
  
  401
  
  376Sales attributable to non-controlling
  interests(1)
  
  (53
  )
  (176
  )
  (13
  )
  
  
  Ounces/pounds sold  equity basis
  
  8,055
  
  8,390
  
  5,320
  
  401
  
  376Total cash costs per ounce/pound  equity
  basis
  
  $
  350
  
  $
  283
  
  $
  224
  
  $
  0.83
  
  $
  0.79Amortization per ounce/pound  equity basis
  
  104
  
  81
  
  76
  
  0.30
  
  0.17Inventory purchase accounting adjustments
  per ounce/pound
  
  
  
  1
  
  
  
  0.02
  
  0.26Cost of sales and amortization per
  ounce/pound attributable to non-controlling interests(2)
  
  1
  
  9
  
  8
  
  
  
  Total costs per ounce/pound(3) 
  consolidated basis
  
  $
  455
  
  $
  374
  
  $
  308
  
  $
  1.15
  
  $
  1.22  
 (1)The
2005 comparative periods for copper have been omitted as we did not produce any
significant amounts of copper prior to the production from the copper mines
acquired with Placer Dome.  (2)Relates
to a 70% interest in Tulawaka and a 50% interest in South Deep prior to 2007.  (3)Includes
amortization, amounts attributable to non-controlling interests and inventory
purchase accounting adjustments.  73


Glossary
of Technical Terms  AUTOCLAVE: Oxidation process in
which high temperatures and pressures are applied to convert refractory sulfide
mineralization into amenable oxide ore.  BACKFILL: Primarily waste sand or
rock used to support the roof or walls after removal of ore from a stope.  BY-PRODUCT: A secondary metal or
mineral product recovered in the milling process such as copper and silver.  CONCENTRATE: A very fine, powder-like
product containing the valuable ore mineral from which most of the waste
mineral has been eliminated.  CONTAINED OUNCES:Represents ounces in the ground before reduction of ounces not able to
be recovered by the applicable metallurgical process.  CONTANGO: The positive difference
between the spot market gold price and the forward market gold price. It is
often expressed as an interest rate quoted with reference to the difference
between inter-bank deposit rates and gold lease rates.  DEVELOPMENT: Work carried out for the
purpose of opening up a mineral deposit. In an underground mine this includes
shaft sinking, crosscutting, drifting and raising. In an open pit mine,
development includes the removal of overburden.  DILUTION: The effect of waste or
low-grade ore which is unavoidably included in the mined ore, lowering the
recovered grade.  DORÉ: Unrefined gold and silver
bullion bars usually consisting of approximately 90 percent precious metals
that will be further refined to almost pure metal.  DRILLING:  Core:drilling with a hollow bit with a diamond cutting rim to produce a
cylindrical core that is used for geological study and assays. Used in mineral
exploration.  In-fill:any method of drilling intervals between existing holes, used to
provide greater geological detail and to help establish reserve estimates.  EXPLORATION: Prospecting, sampling,
mapping, diamond-drilling and other work involved in searching for ore.  GRADE: The amount of metal in each ton
of ore, expressed as troy ounces per ton or grams per tonne for precious metals
and as a percentage for most other metals.  Cut-off grade:the minimum metal grade at which an orebody can be economically mined
(used in the calculation of ore reserves).  Mill-head grade:metal content of mined ore going into a mill for processing.  Recovered grade:actual metal content of ore determined after processing.  Reserve grade:estimated metal content of an orebody, based on reserve calculations.  HEAP LEACHING: A process whereby gold
is extracted by heaping broken ore on sloping impermeable pads and
continually applying to the heaps a weak cyanide solution which dissolves the
contained gold. The gold-laden solution is then collected for gold recovery.  HEAP LEACH PAD: A large impermeable
foundation or pad used as a base for ore during heap leaching.  MILL: A processing facility where ore
is finely ground and thereafter undergoes physical or chemical treatment to
extract the valuable metals.  74


MINERAL RESERVE:See pages 137 to 138 
Summary Gold Mineral Reserves and Mineral Resources.  MINERAL RESOURCE:See pages 137 to 138
 Summary Gold Mineral Reserves and Mineral Resources.  MINING CLAIM:That portion of applicable
mineral lands that a party has staked or marked out in accordance with
applicable mining laws to acquire the right to explore for and exploit the
minerals under the surface.  MINING RATE:Tons of ore mined per day or
even specified time period.  OPEN PIT:A mine where the minerals are
mined entirely from the surface.  ORE:Rock, generally containing metallic or
nonmetallic minerals, which can be mined and processed at a profit.  ORE BODY:A sufficiently large amount of
ore that can be mined economically.  OUNCES:Troy ounces of a fineness of 999.9
parts per 1,000 parts.  RECLAMATION:The process by which lands
disturbed as a result of mining activity are modified to support beneficial
land use. Reclamation activity may include the removal of buildings, equipment,
machinery and other physical remnants of mining, closure of tailings storage
facilities, leach pads and other mine features, and contouring, covering and
re-vegetation of waste rock and other disturbed areas.  RECOVERY RATE:A term used in process
metallurgy to indicate the proportion of valuable material physically recovered
in the processing of ore. It is generally stated as a percentage of the
material recovered compared to the total material originally present.  REFINING:The final stage of metal
production in which impurities are removed from the molten metal.  STRIPPING:Removal of overburden or waste
rock overlying an ore body in preparation for mining by open pit methods.
Expressed as the total number of tons mined or to be mined for each ounce of
gold.  TAILINGS:The material that remains after
all economically and technically recoverable precious metals have been removed
from the ore during processing.  75