##### 



EXHIBIT 4
  Contents
 2
    
    
    Our Business2
    
    
    Core Business2
    
    
    Vision and Strategy4
    
    
    Capability to Execute our Strategy7
    
    
    Key Economic Trends14
    
    
    Operations Review15
    
    
    Executive Overview and 2007 Outlook17
    
    
    Acquisitions and Divestitures20
    
    
    Consolidated Gold and Copper Production, Sales and Costs21
    
    
    Results of Operating Segments34
    
    
    Total Cash Costs Performance Measures37
    
    
    Other Costs and Expenses43
    
    
    Quarterly Information44
    
    
    Fourth Quarter Results45
    
    
    Liquidity, Capital Resources and Financial Position45
    
    
    Cash Flow47
    
    
    Liquidity48
    
    
    Financial Position49
    
    
    Contractual Obligations and Commitments51
    
    
    Financial Instruments52
    
    
    Off-Balance Sheet Arrangements55
    
    
    Critical Accounting Policies and Estimates65
    
    
    Cautionary Statement on Forward-Looking Information66
    
    
    Glossary of Technical Terms
  §
    
    Our Business  a general description of our core business; our vision and strategy;
our capability to execute our strategy; and key economic trends in our present business
environment.
 §
    
    Operations Review  an analysis of our consolidated results of operations for the
last three years focusing on our material operating segments and the outlook for 2007.
 §
    
    Liquidity, Capital Resources and Financial Position an analysis of cash flows;
sources and uses of cash; contractual obligations and commitments; our financial position;
financial instruments; and off-balance sheet arrangements.
 §
    
    Critical Accounting Policies and Estimates  a discussion of accounting policies that
require critical judgments and estimates.
   Barrick Financial Report 2006
    
    Managements Discussion and Analysis § 1




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##### 



Our Business
 Core Business
  
  Vision and Strategy
    2§ Managements Discussion and Analysis
    
    Barrick Financial Report 2006




---



##### 



2006 Strategic Objectives
 Growth in reserves and production
 §
    
    Growth at existing
mine sites by finding new
reserves and converting
mineralized material to
reserves§
    
    Growth through
successful exploration
focusing principally in
key exploration
districts§
    
    Growth through targeted acquisitions§
    
    Advance the
development of Cowal,
Pascua-Lama, Ruby Hill
and Buzwagi as well as
newly acquired Placer
Dome projects, including
Pueblo Viejo, Cortez
Hills, Donlin Creek and
Sedibelo
 Operational excellence
 §
    
    Control costs
 §
    
    Global supply
chain management
(such as extending
tire life and
evaluating
alternatives for
supply)§
    
    Continuous improvement initiatives§
    
    Currency, interest
rate and commodity hedge
programs
 §
    
    Effective assessment
and management of risk§
    
    Effective capital allocation§
    
    Secure efficient
sources of funding
for capital
 2006 Results
 §
    
    Met market guidance for production§
    
    Benefited from an
excellent first full year
of production at 3 new
mines and brought the Cowal
mine into production§
    
    Advanced all of our major projects§
    
    Achieved reserve
growth through
exploration
discoveries§
    
    Completed Placer Dome
acquisition, sale of
assets to Goldcorp Inc.
(Goldcorp), South Deep
sale, and Reko Diq
acquisition§
    
    Research and development
successes that are expected
to enhance project economics§
    
    Realigned Russian business strategy§
    
    Met market guidance for total cash costs§
    
    Effective program of
hedging and managing
production cost risks, such
as currency exchange rates,
fuel and power§
    
    Successfully reduced
fixed-price Corporate Gold
Sales Contracts and
eliminated acquired Placer
Dome hedge position§
    
    Continuous improvement
initiatives ongoing to
mitigate cost pressures,
increase throughput and
quality improvements§
    
    Launched capital
allocation process
improvements including
new approvals process
and tracking system§
    
    Issued $1 billion of
copper-linked notes and
increased credit facility
from $1.0 to $1.5 billion
 2007 Strategic Objectives
 Share 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 additional
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
    Strengthen the organization
 §
    
    Workforce  identify and develop talent§
    
    Leadership
development and
succession planning§
    
    Adopt best practices
in corporate governance,
including strengthening
internal control over
financial reporting
 §
    
    Successful integration
of Placer Dome across all
regions and functions,
including cultural
integration§
    
    Leadership
development and
succession plans
completed for key
leaders§
    
    Achieved targets in
developing compliance and
governance capabilities
 High performance organization
 §
    
    Leadership development§
    
    Optimization of
business processes such
as planning project
management and risk
management§
    
    Technology
improvements to
increase automation and
control costs§
    
    Effective capital
management through
prioritization, capital
allocation and value
measurement§
    
    Compliance with
business code of
conduct and
applicable corporate
governance
legislation
    Responsible mining
 §
    
    Reinforce health and safety culture§
    
    Enhance environmental
performance, including
use of innovative
technology to protect
the environment§
    
    Maintain positive
community and
government relations
 §
    
    Courageous Safety
Leadership program
rolled out across
Barrick§
    
    Focus on contractor
safety resulted in 40%
reduction of incidents
over 2005§
    
    Developed and adopted
Corporate Social
Responsibility (CSR)
guidelines across Barrick§
    
    Expanded
Non-Governmental
Organizations (NGO)
partnerships§
    
    Improved ratings
on Dow Jones
Sustainability
Index§
    
    Recipient of 2006
CME/CIDA Award for
Excellence in CSR
 Responsible mining
 §
    
    Achieve safety and
health performance
targets§
    
    Effective
government relations
and community
engagement§
    
    Environmental
leadership through energy
and conservation strategy
   Barrick Financial Report 2006
    
    Managements Discussion and Analysis § 3




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##### 



Capability to Execute our Strategy
  Regional Business Unit Structure
    Experienced Management Team and Skilled Workforce
  Advanced Exploration and Project Pipeline
   4§ Managements Discussion and Analysis
    
    Barrick Financial Report 2006




---



##### 



Cost Control and Supply Sourcing
    Barrick Financial Report 2006
    
    Managements Discussion and Analysis § 5




---



##### 



Maintenance Program
    Continuous Improvement
  Environmental, Health and Safety
   6§ Managements Discussion and Analysis
    
    Barrick Financial Report 2006




---



##### 



Information Management and Technology
  Internal Control Over Financial Reporting
    Key Economic Trends
  Gold, Copper and Silver Prices
  Barrick Financial Report 2006
    
    Managements Discussion and Analysis § 7




---



##### 



8§ Managements Discussion and Analysis
    
    Barrick Financial Report 2006




---



##### 



Barrick Financial Report 2006
    
    Managements Discussion and Analysis § 9




---



##### 



Currency Exchange Rates
  
 
 
   10§Managements Discussion and Analysis
    
    Barrick Financial Report 2006




---



##### 



Inflationary Cost Pressures
  Fuel
  
  Barrick Financial Report 2006
    
    Managements Discussion and Analysis §11




---



##### 



Electricity
   Consumables
   12§Managements Discussion and Analysis
    
    Barrick Financial Report 2006




---



##### 



Labor Costs
  US Dollar Interest Rates
 
  Barrick Financial Report 2006
    
    Managements Discussion and Analysis § 13




---



##### 



Operations Review
 Selected Annual Information
 ($ millions, except per share,per ounce/pound data in dollars)
    
    Gold
    
    
    Copper1For the years ended December 31
    
    2006
    
    
    2005
    
    
    2004
    
    
    2006Production (000s oz/millions lbs)2
    
    
    8,643
    
    
    
    5,460
    
    
    
    4,958
    
    
    
    367Sales000s oz/millions lbs3
    
    
    8,390
    
    
    
    5,320
    
    
    
    4,936
    
    
    
    376$ millions3
    
    $
    4,485
    
    
    $
    2,350
    
    
    $
    1,932
    
    
    $
    1,151Market price4
    
    
    604
    
    
    
    444
    
    
    
    409
    
    
    
    3.05Realized price4,5
    
    
    541
    
    
    
    439
    
    
    
    391
    
    
    
    3.06Total cash costs2,4,6
    
    
    282
    
    
    
    227
    
    
    
    214
    
    
    
    0.79Amortization2,4,7
    
    
    77
    
    
    
    76
    
    
    
    86
    
    
    
    0.43Total production costs2,4
    
    $
    359
    
    
    $
    303
    
    
    $
    300
    
    
    $
    1.22
 2006
    
    
    2005
    
    
    2004Net income from continuing operations
    
    $
    1,209
    
    
    $
    395
    
    
    $
    248Net income from continuing
operations  per shareBasic
    
    
    1.44
    
    
    
    0.74
    
    
    
    0.47Diluted
    
    
    1.42
    
    
    
    0.73
    
    
    
    0.46Net income
    
    
    1,506
    
    
    
    401
    
    
    
    248Net income per shareBasic
    
    
    1.79
    
    
    
    0.75
    
    
    
    0.47Diluted
    
    
    1.77
    
    
    
    0.75
    
    
    
    0.46Cash inflow (outflow) from
continuing operationsOperating activities
    
    
    2,122
    
    
    
    726
    
    
    
    509Investing activities
    
    
    (1,593
    )
    
    
    (1,180
    )
    
    
    (821
    )Financing activities
    
    
    (1,347
    )
    
    
    93
    
    
    
    740Cash inflow from discontinued
operations8
    
    
    2,828
    
    
    
    
    
    
    
    Cash position  end of year
    
    
    3,043
    
    
    
    1,037
    
    
    
    1,398Total assets9
    
    
    21,373
    
    
    
    6,862
    
    
    
    6,287Total long-term financial liabilities10
    
    $
    3,394
    
    
    $
    1,780
    
    
    $
    1,707Gold reserves (millions of contained ounces)
    
    
    123.1
    A
    
    
    88.6
    
    
    
    89.1Copper reserves (billions of contained pounds)
    
    
    6.0
    A
    
    
    
    
    
    
    
 
 1.
    
    The 2005 and 2004 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.
    
    Gold production and total cash cost per
ounce/pound/ton statistics reflect our equity
share of production, including our equity
share of production from the South Deep mine
through November 30, 2006.3.
    
    Gold sales ($ millions) exclude the results
of discontinued operations. Gold sales (000s
oz/millions lbs) exclude the results of
discontinued operations and reflect our
equity share of sales.4.
    
    Per ounce/pound weighted average.5.
    
    The realized gold price in 2006 is inclusive
of the opportunity cost of deliveries into
gold sales contracts of $367 million,
combined with Placer Dome gold hedge
accounting adjustments of $165 million.6.
    
    Total cash costs per ounce/pound/ton
statistics exclude amortization and inventory
purchase accounting adjustments. Total cash
costs per ounce/ pound/ton is a performance
measure that is used throughout this MD&A.
For more information see pages 34 to 36.7.
    
    Amortization includes inventory purchase accounting adjustments.8.
    
    In 2006, we received cash of approximately
$1.6 billion from the sale of operations to
Goldcorp and approximately $1.2 billion from
the sale of the South Deep mine to Gold
Fields Limited (Gold Fields).9.
    
    Total assets increased in 2006 largely due
to the acquisition of Placer Dome that
resulted in the recognition of assets
totaling $15.3 billion.10.
    
    Total long-term financial liabilities
increased in 2006 largely due to liabilities
totaling $3.0 billion that were assumed in the
acquisition of Placer Dome. 1 2 2 2 2 2
 
 1.
    
    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,
1.88 million ounces of the Cortez reserve, Buzwagi
and Pueblo Viejo are classified as mineralized
material. For a breakdown of reserves and resources
by category and additional information relating to
reserves and resources, see pages 128136 of this
Financial Report 2006.2.
    
    For a breakdown of reserves and resources by
category and additional information relating to
reserves and resources, see pages 128136 of this
Financial Report 2006.A.
    
    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,
1.88 million ounces of the Cortez reserve, Buzwagi
and Pueblo Viejo are classified as mineralized
material. For a breakdown of reserves and resources
by category and additional information relating to
reserves and resources, see pages 128136 of this
Financial Report 2006. 14§ Managements Discussion and Analysis
    
    Barrick Financial Report 2006




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##### 



Executive Overview and 2007 Outlook
  Key Factors Affecting Earnings
 For the years ended December 31
    
    Refer($ millions)
    
    to pageNet income  2005
    
    
    
    
    
    
    
    
    
    $
    401Increase (decrease)Higher market gold prices1
    
    
    7
    
    
    $
    1,342Less: impact of gold sales contracts1
    
    
    7
    
    
    
    (476
    )Higher sales volumes gold2
    
    
    20
    
    
    
    429Higher earnings from copper sales
    
    
    20
    
    
    
    767Higher total cash costs
    
    
    20
    
    
    
    (461
    )Higher interest expense
    
    
    
    
    
    
    (119
    )Higher exploration and project
development expense
    
    
    37
    
    
    
    (149
    )Higher income tax expense3
    
    
    42
    
    
    
    (387
    )Special items1,4
    
    
    16
    
    
    
    265Other
    
    
    
    
    
    
    (106
    )Total increase
    
    
    
    
    
    
    
    
    
    $
    1,105Net income  2006
    
    
    
    
    
    
    
    
    
    $
    1,506
 
 1.
    
    Our realized gold price was reduced
during the year for the opportunity cost
of deliveries into fixed-price Corporate
Gold Sales Contracts of $367 million,
combined with Placer Dome gold hedge
accounting adjustments of $165 million. Had it not
been for these items, our realized price
would have been approximately $63 per
ounce higher in 2006. The opportunity cost
of deliveries into fixed-price Corporate
Gold Sales Contracts and the Placer Dome
gold hedge accounting adjustments have
been excluded from the special items line
on this table.2.
    
    Impact of changing sales volumes
on margin between selling prices, total
cash costs and amortization, but
excluding inventory purchase accounting
adjustments.3.
    
    Excluding the impact of the tax
effects of special items.4.
    
    Special items are presented on a
post-tax basis. See page 16 for a
description of the special items. Barrick Financial Report 2006
    
    Managements Discussion and Analysis §  15




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##### 



Special Items  Effect on Earnings Increase (Decrease) ($ millions)
  Refer to
    
    
    2006
    
    
    2005
    
    
    2004page
    
    
    Pre-tax
    
    
    Post-tax
    
    
    Pre-tax
    
    
    Post-tax
    
    
    Pre-tax
    
    
    Post-taxGain on sale of South Deep
    
    
    19
    
    
    $
    288
    
    
    $
    288
    
    
    $
    
    
    
    $
    
    
    
    $
    
    
    
    $
    Opportunity cost of deliveries into Corporate
Gold Sales Contracts
    
    
    7
    
    
    
    (367
    )
    
    
    (352
    )
    
    
    (56
    )
    
    
    (55
    )
    
    
    (89
    )
    
    
    (88
    )Hedge accounting adjustments related to the acquired
Placer Dome gold hedge position
    
    
    7
    
    
    
    (165
    )
    
    
    (112
    )
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Impairment charges on investments and other
long-lived assets
    
    
    40
    
    
    
    (23
    )
    
    
    (18
    )
    
    
    (16
    )
    
    
    (16
    )
    
    
    (144
    )
    
    
    (99
    )Inventory purchase accounting adjustments
    
    
    
    
    
    
    (108
    )
    
    
    (87
    )
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Changes in asset retirement obligation cost estimates
at closed mines
    
    
    41
    
    
    
    (53
    )
    
    
    (35
    )
    
    
    (15
    )
    
    
    (11
    )
    
    
    (22
    )
    
    
    (17
    )Non-hedge derivative gains
    
    
    41
    
    
    
    
    
    
    
    29
    
    
    
    6
    
    
    
    4
    
    
    
    5
    
    
    
    9Highland vend-in
    
    
    19
    
    
    
    51
    
    
    
    51
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Peruvian voluntary contribution
    
    
    27
    
    
    
    (8
    )
    
    
    (6
    )
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Deferred stripping accounting changes
Cumulative effect
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    6
    
    
    
    6
    
    
    
    
    
    
    
    Resolution of Peruvian tax assessmentOutcome of tax uncertainties
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    141Reversal of other accrued costs
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    21
    
    
    
    15Deferred tax credits due to change in tax status
    
    
    64
    
    
    
    
    
    
    
    31
    
    
    
    
    
    
    
    5
    
    
    
    
    
    
    
    81Total
    
    
    
    
    
    $
    (385
    )
    
    $
    (211
    )
    
    $
    (75
    )
    
    $
    (67
    )
    
    $
    (229
    )
    
    $
    42
 16§  Managements Discussion and Analysis
    
    Barrick Financial Report 2006




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##### 



2007 Outlook
 For the year ended December 31($ millions except as otherwise indicated)
    
    2007EGoldProduction (millions of ounces)
    
    
    8.18.4Total cash costs1($  per ounce)
    
    $
    335$350Amortization2($  per ounce)
    
    $
    95CopperProduction (millions of pounds)
    
    
    400Total cash costs1($  per pound)
    
    $
    0.90Amortization2($  per pound)
    
    $
    0.30Corporate administration expense
    
    $
    140Exploration expense
    
    $
    170Project development expense3
    
    $
    190Other operating expenses
    
    $
    115Interest income4
    
    $
    130Interest expense5
    
    $
    95Capital expenditures6
    
    $
    1,100$1,800Tax rate7
    
    
    30
    %
 
 1.
    
    Guidance reflects our equity share of
production. Gold production is expected to be
slightly lower in the first half of 2007 than
in the second half of 2007. Total cash costs
per
ounce/pound/ton exclude amortization expense and
inventory purchase accounting adjustments charged
to cost of sales. Total cash costs per
ounce/pound/ton is a performance measure that is
used throughout this MD&A. For more information
see pages 34 to 36.2.
    
    Increase in rates per ounce in 2007
principally reflects the final purchase price
allocation for Placer Dome mines.3.
    
    Increase in 2007 mainly reflects higher
development activity levels at projects.4.
    
    Higher interest income in 2007 mainly reflects
expected higher average cash balances.5.
    
    Net of amounts capitalized of $140 million.
Interest costs incurred are expected to
increase in 2007 due to higher levels of debt
outstanding after debt issuances in 2006.
Interest expense is expected to decrease in
2007 as more interest is capitalized at
acquired late-stage exploration and other
projects including Cortez Hills, Donlin
Creek, Pueblo Viejo, Buzwagi, Sedibelo, and
Reko Diq.6.
    
    Higher capital expenditures in 2007 include
construction costs expected at Buzwagi,
Pascua-Lama and Pueblo Viejo totaling $900
million. Range is subject to the Company
receiving the timely receipt of permits and
construction approvals.7.
    
    Represents the underlying effective tax rate
excluding the impact of deliveries into
corporate gold sales contracts, as well as
the impact of tax rate changes and changes in
deferred tax valuation allowances. The
effective tax rate for the full year is
expected to be approximately 45% when the
$629 million opportunity cost of delivering
into gold sales contracts in a low tax-rate
jurisdiction is included. As a result of
these deliveries the tax expense in first and
second quarters is expected to be based on
the 30% underlying effective tax rate on
income excluding this opportunity cost.  Acquisitions and Divestitures
  Acquisition of Placer Dome
   Barrick Financial Report 2006
    
    Managements Discussion and Analysis § 17




---



##### 



§

    
    Administration and offices
globally  We expect this area to contribute
about 25% of the total synergies. In 2006, we
closed redundant offices around the world,
including Placer Domes Brisbane office in
Australia; Santiago office in Chile; and Reno
and Denver offices in the US. Most head
office functions have been transferred from
Vancouver to Toronto. We have also begun to
realize synergies from other consolidating
activities around IT services, consolidated
annual reporting, and establishment of
regional shared service centers.§
    
    Exploration  This area contributes about
25% of the total synergies. In 2006,
synergies were realized mainly from a
reduced total exploration expenditure on
new mine exploration due to overlapping
budgets and reduced exploration on existing
Barrick and Placer projects as a result of
more rigorous approval criteria for the
combined company.§
    
    Operations and technical services  This
area comprises about 20% of the total
synergies. Value is being driven from
sharing of operational and maintenance best
practices;
project optimization; continuous improvement;
strategic sourcing and supply chain management.§
    
    Finance and tax  We captured significant
value by capitalizing on opportunities for
debt consolidation, reduced fees and costs,
tax-related savings and insurance savings,
which comprise about 30% of the total
synergies.
   18§ Managements Discussion and Analysis
    
    Barrick Financial Report 2006




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##### 



Sale of Certain Placer Dome Operations to Goldcorp
  Acquisition of Interest in Reko Diq
  Sale of South Deep Mine to Gold Fields Limited
  Vend-in of assets to Highland
  Barrick Financial Report 2006
    
    Managements Discussion and Analysis § 19




---



##### 



Consolidated Gold and Copper Production, Sales and Costs
    Consolidated Cost of Sales/Total Cash Costs of Gold 1,2
 in millions
    
    
    per ounceFor the years ended December 31
    
    2006
    
    
    2005
    
    
    2004
    
    
    2006
    
    
    2005
    
    
    2004Cost of goods sold1,2,3
    
    $
    2,388
    
    
    $
    1,357
    
    
    $
    1,217
    
    
    $
    285
    
    
    $
    255
    
    
    $
    248Currency/commodity hedge gains
    
    
    (100
    )
    
    
    (110
    )
    
    
    (100
    )
    
    
    (12
    )
    
    
    (21
    )
    
    
    (19
    )By-product credits
    
    
    (123
    )
    
    
    (132
    )
    
    
    (146
    )
    
    
    (15
    )
    
    
    (25
    )
    
    
    (30
    )Royalties/production taxes
    
    
    177
    
    
    
    81
    
    
    
    65
    
    
    
    21
    
    
    
    16
    
    
    
    13Accretion/other costs
    
    
    28
    
    
    
    11
    
    
    
    11
    
    
    
    3
    
    
    
    2
    
    
    
    2Cost of sales/Total cash costs1
    
    $
    2,370
    
    
    $
    1,207
    
    
    $
    1,047
    
    
    $
    282
    
    
    $
    227
    
    
    $
    214
 
 1.
    
    Total cash costs and cost of sales both exclude amortization and
inventory purchase accounting adjustments  see page 36.2.
    
    Excludes costs of sales related to discontinued operations and
non-controlling interests.3.
    
    At market currency exchange and commodity rates.  20§ Managements Discussion and Analysis
    
    Barrick Financial Report 2006




---



##### 



Results of Operating Segments
    Regional Production and Total Cash Costs
 Production
    
    
    Total cash costs(000s ozs/millions lbs)
    
    
    ($ per oz/lb)Year ended December 31
    
    2006
    
    
    2005
    
    
    2004
    
    
    2006
    
    
    2005
    
    
    2004GoldNorth America
    
    
    3,372
    
    
    
    2,863
    
    
    
    2,963
    
    
    $
    314
    
    
    $
    244
    
    
    $
    223South America
    
    
    2,104
    
    
    
    1,234
    
    
    
    646
    
    
    
    147
    
    
    
    126
    
    
    
    111Australia Pacific
    
    
    2,220
    
    
    
    934
    
    
    
    999
    
    
    
    353
    
    
    
    257
    
    
    
    229Africa
    
    
    914
    
    
    
    398
    
    
    
    350
    
    
    
    315
    
    
    
    336
    
    
    
    284Other
    
    
    33
    
    
    
    31
    
    
    
    
    
    
    
    481
    
    
    
    303
    
    
    
    Total
    
    
    8,643
    
    
    
    5,460
    
    
    
    4,958
    
    
    
    282
    
    
    
    227
    
    
    
    214Copper1South America
    
    
    308
    
    
    
    
    
    
    
    
    
    
    
    0.62
    
    
    
    
    
    
    
    Australia Pacific
    
    
    59
    
    
    
    
    
    
    
    
    
    
    
    1.53
    
    
    
    
    
    
    
    Total
    
    
    367
    
    
    
    
    
    
    
    
    
    
    $
    0.79
    
    
    $
    
    
    
    $
    
 
 1.
    
    The 2005 and 2004 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. Barrick Financial Report 2006
    
    Managements Discussion and Analysis §  21




---



##### 



Consolidated Operational Trends  Gold
  
 
 1.
    
    All amounts presented are based on equity production. 
 
 1.
    
    All amounts presented are based on equity production.2.
    
    New mines include: Tulawaka, Lagunas Norte, Veladero and Cowal.  22§ Managements Discussion and Analysis
    
    Barrick Financial Report 2006




---



##### 



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. Average
mill head grades for new mines include those
mines that have commenced production
beginning in 2005 and into 2006 (Tulawaka,
Lagunas Norte, Veladero and Cowal). 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. 2004 and 2005
data exclude reserve grades for former Placer
Dome mines. 2006 data includes reserve grade
data for Placer Dome mines based on reserve
data from Placer Domes fourth quarter 2005
report.  
 
 1.
    
    Total cash costs per ounce/pound/ton
statistics exclude amortization and inventory
purchase accounting adjustments. Total cash
costs per ounce/ pound/ton is a performance
measure that is used throughout this MD&A.
For more information see pages 34 to 36.  Barrick Financial Report 2006
    
    Managements Discussion and Analysis § 23




---



##### 



Operating
Segments  GoldNorth America
 
 Producing Mines
   24§ Managements Discussion and Analysis
    
    Barrick Financial Report 2006




---



##### 



Significant Projects
 1
 2
 
 1.
    
    For a breakdown of reserves and resources by
category and additional information relating
to reserves and resources, see pages 128136
of this Financial Report 2006.2.
    
    Excluding capitalized interest. Barrick Financial Report 2006
    
    Managements Discussion and Analysis §  25




---



##### 



1 2
 3
  
 1.
    
    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 128136 of this
Financial Report 2006.2.
    
    For a breakdown of reserves and resources by
category and additional information relating
to reserves and resources, see pages 128136
of this Financial Report 2006.3.
    
    Excluding capitalized interest. 26§ Managements Discussion and Analysis
    
    Barrick Financial Report 2006




---



##### 



1 1
 South America
 
 Producing Mines
   
 1.
    
    For a breakdown of reserves and resources by
category and additional information relating
to reserves and resources, see pages 128136
of this Financial Report 2006. Barrick Financial Report 2006
    
    Managements Discussion and Analysis §  27




---



##### 



Significant Projects
  1 1 2
 
 1.
    
    For a breakdown of reserves and resources by
category and additional information relating
to reserves and resources, see pages 128136
of this Financial Report 2006.2.
    
    Excluding capitalized interest. 28§ Managements Discussion and Analysis
    
    Barrick Financial Report 2006




---



##### 



Australia Pacific
 
 Producing Mines
     Barrick Financial Report 2006
    
    Managements Discussion and Analysis § 29




---



##### 



Africa
 
 Producing Mines
  30§ Managements Discussion and Analysis
    
    Barrick Financial Report 2006




---



##### 



Barrick Financial Report 2006
    
    Managements Discussion and Analysis § 31




---



##### 



Significant Projects
 1 2
 Operating Segments  Copper
 
   
 1.
    
    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,
Buzwagi is classified as mineralized
material. For a breakdown of reserves and
resources by category and additional
information relating to reserves and
resources, see pages 128136 of this
Financial Report 2006.2.
    
    Excluding capitalized interest. 32§ Managements Discussion and Analysis
    
    Barrick Financial Report 2006




---



##### 



Other Significant Projects
 1 1
 2 2
  
 1.
    
    For a breakdown of reserves and resources by
category and additional information relating
to reserves and resources, see pages 128136
of this Financial Report 2006.2.
    
    Calculated as at December 31, 2006 in
accordance with National Instrument 43-101 as
required by Canadian securities regulatory
authorities. Calculations have been prepared
by or under the supervision of Hannes
Henckel, Manager Exploration and Geology of
Barrick. Sedibelo measured and indicated
resources have been estimated using varying
cut-off rates, as applicable, depending on
the ore type, and other relevant factors. Barrick Financial Report 2006
    
    Managements Discussion and Analysis § 33




---



##### 



1 1
 Exploration Strategy
  1 1
 Total Cash Costs Performance Measures
  
 1.
    
    For a breakdown of reserves and resources by
category and additional information relating
to reserves and resources, see pages 128136
of this Financial Report 2006. 34§ Managements Discussion and Analysis
    
    Barrick Financial Report 2006




---



##### 



Barrick Financial Report 2006
    
    Managements Discussion and Analysis §  35




---



##### 



Illustration of Impact of Excluding Certain Costs from Total Cash Costs per Ounce/Pound/Ton
 For the three months
    
    
    For the years endedended December 31
    
    
    December 31($ millions, except per ounce/pound/ton
    
    Gold
    
    
    Copper
    
    
    Gold
    
    
    Copper1information in dollars)
    
    2006
    
    
    2005
    
    
    2006
    
    
    2006
    
    
    2005
    
    
    2004
    
    
    2006Cost of sales2
    
    $
    652
    
    
    $
    367
    
    
    $
    108
    
    
    $
    2,343
    
    
    $
    1,214
    
    
    $
    1,047
    
    
    $
    393Cost of sales at South Deep included in discontinued operations
    
    
    12
    
    
    
    
    
    
    
    
    
    
    
    101
    
    
    
    
    
    
    
    
    
    
    
    Cost of sales attributable to non-controlling interests3
    
    
    (11
    )
    
    
    (2
    )
    
    
    
    
    
    
    (63
    )
    
    
    (7
    )
    
    
    
    
    
    
    Inventory purchase accounting adjustments included in cost of sales4
    
    
    1
    
    
    
    
    
    
    
    (26
    )
    
    
    (11
    )
    
    
    
    
    
    
    
    
    
    
    (97
    )Cost of sales as adjusted
    
    
    654
    
    
    
    365
    
    
    
    82
    
    
    
    2,370
    
    
    
    1,207
    
    
    
    1,047
    
    
    
    296Amortization at producing mines  consolidated
    
    
    180
    
    
    
    124
    
    
    
    31
    
    
    
    627
    
    
    
    409
    
    
    
    425
    
    
    
    66Amortization at South Deep included in discontinued operations
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    18
    
    
    
    
    
    
    
    
    
    
    
    Amortization at producing mines attributable to
non-controlling interests3
    
    
    (2
    )
    
    
    (2
    )
    
    
    
    
    
    
    (16
    )
    
    
    (5
    )
    
    
    
    
    
    
    Amortization at producing mines  equity basis
    
    
    178
    
    
    
    122
    
    
    
    31
    
    
    
    629
    
    
    
    404
    
    
    
    425
    
    
    
    66Inventory purchase accounting adjustments4
    
    
    (1
    )
    
    
    
    
    
    
    26
    
    
    
    11
    
    
    
    
    
    
    
    
    
    
    
    97Cost of sales including amortization and inventory purchase
accounting adjustments  equity basis
    
    $
    831
    
    
    $
    487
    
    
    $
    139
    
    
    $
    3,010
    
    
    $
    1,611
    
    
    $
    1,472
    
    
    $
    459
 Total cash costs per ounce/pound
    
    For the three months
    
    
    For the years endedended December 31
    
    
    December 31Gold
    
    
    Copper
    
    
    Gold
    
    
    Copper1(Per ounce/pound information in dollars)
    
    2006
    
    
    2005
    
    
    2006
    
    
    2006
    
    
    2005
    
    
    2004
    
    
    2006Ounces/pounds sold  consolidated (thousands/millions)
    
    
    2,314
    
    
    
    1,663
    
    
    
    100
    
    
    
    8,566
    
    
    
    5,353
    
    
    
    4,936
    
    
    
    376Sales attributable to non-controlling interests3
    
    
    (31
    )
    
    
    (13
    )
    
    
    
    
    
    
    (176
    )
    
    
    (33
    )
    
    
    
    
    
    
    Ounces/pounds sold  equity basis
    
    
    2,283
    
    
    
    1,650
    
    
    
    100
    
    
    
    8,390
    
    
    
    5,320
    
    
    
    4,936
    
    
    
    376Total cash costs per ounce/pound  equity basis
    
    $
    287
    
    
    $
    221
    
    
    $
    0.82
    
    
    $
    282
    
    
    $
    227
    
    
    $
    214
    
    
    $
    0.79Amortization per ounce/pound  equity basis
    
    
    77
    
    
    
    74
    
    
    
    0.31
    
    
    
    76
    
    
    
    76
    
    
    
    86
    
    
    
    0.17Inventory purchase accounting adjustments per ounce/pound
    
    
    
    
    
    
    
    
    
    
    0.26
    
    
    
    1
    
    
    
    
    
    
    
    
    
    
    
    0.26Cost of sales and amortization per ounce/pound attributable
to non-controlling interests3
    
    
    1
    
    
    
    
    
    
    
    
    
    
    
    2
    
    
    
    
    
    
    
    
    
    
    
    Total costs per ounce/pound5 consolidated basis
    
    $
    365
    
    
    $
    295
    
    
    $
    1.39
    
    
    $
    361
    
    
    $
    303
    
    
    $
    300
    
    
    $
    1.22
 Total cash costs per ton
    
    For the years endedDecember 31Gold
    
    
    Copper1(Per ton information in dollars)
    
    2006
    
    
    2005
    
    
    2004
    
    
    2006Tons processed consolidated (millions of tons)
    
    
    158
    
    
    
    98
    
    
    
    84
    
    
    
    28Tons attributed to non-controlling interests (millions of tons)3
    
    
    (1
    )
    
    
    
    
    
    
    
    
    
    
    Tons processed  equity (millions of tons)
    
    
    157
    
    
    
    98
    
    
    
    84
    
    
    
    28Cost per ton  equity basis
    
    $
    15
    
    
    $
    12
    
    
    $
    12
    
    
    $
    11Amortization per ton
    
    
    4
    
    
    
    4
    
    
    
    5
    
    
    
    2Inventory purchase accounting adjustments
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    3Cost of sales and amortization per ton attributable to non-controlling interests3
    
    
    1
    
    
    
    
    
    
    
    
    
    
    
    Cost per ton5 consolidated basis
    
    $
    20
    
    
    $
    16
    
    
    $
    17
    
    
    $
    16
 1.
    
    The 2005 and 2004 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 30% interest
in Tulawaka and a 50% interest in South Deep.4.
    
    Based on our equity interest.5.
    
    Includes amortization, amounts attributable to non-controlling interests and inventory purchase
accounting adjustments.
 36§ Managements Discussion and Analysis
    
    Barrick Financial Report 2006




---



##### 



Other Costs and Expenses
 Exploration Expense
 ($ millions)
    
    2006
    
    
    2005
    
    
    2004
    
    
    Comments on significant variancesExplorationNorth America
    
    $
    64
    
    
    $
    34
    
    
    $
    30
    
    
    2006 vs. 2005  Expenditures are higher in 2006 due to activities at Goldstrike, Cortez, Bald Mountain, Round Mountain and Pueblo Viejo.South America
    
    
    22
    
    
    
    19
    
    
    
    20
    
    
    2006 vs. 2005  Expenditures are higher in 2006 due to activities at Lagunas Norte and Veladero.Australia Pacific
    
    
    44
    
    
    
    13
    
    
    
    17
    
    
    2006 vs. 2005  Expenditures are higher in 2006 due to activities at Porgera and other Papua New Guinea exploration properties, Cowal, Plutonic and Kalgoorlie.Africa
    
    
    22
    
    
    
    34
    
    
    
    23
    
    
    2006 vs. 2005  Lower activity at Buzwagi, partly offset by higher expenditures at Nyanzaga. 2005 vs. 2004  Higher activity at Bulyanhulu.Other
    
    
    19
    
    
    
    9
    
    
    
    6
    
    
    2006 vs. 2005  Higher activity in Indonesia and Eurasia.Total
    
    $
    171
    
    
    $
    109
    
    
    $
    96
 Project Development Expense
 ($ millions)
    
    2006
    
    
    2005
    
    
    2004
    
    
    Comments on significant variancesMine development
    
    $
    78
    
    
    $
    2
    
    
    $
    15
    
    
    2006 vs. 2005  In 2006, expenditures were higher principally due to activities at acquired Placer Dome projects including Donlin Creek, Pueblo Viejo and Sedibelo. 2005 vs. 2004  In 2004, Lagunas Norte
development costs were expensed for part of the year.Non-capitalizable project costs
    
    
    24
    
    
    
    20
    
    
    
    12
    
    
    Non-capitalizable costs mainly represent items incurred in the development/construction phase that cannot be capitalized. 2006 vs. 2005  Costs are higher in 2006 due to higher start-up costs at Buzwagi,
Taseevskoye and Pascua-Lama. 2005 vs. 2004  Higher amounts for Cowal, Pascua-Lama and Veladero.Business development/other
    
    
    17
    
    
    
    10
    
    
    
    18
    
    
    In 2006, expenditures were higher due to increase in research and development activity.Total
    
    $
    119
    
    
    $
    32
    
    
    $
    45
 Barrick Financial Report 2006
    
    Managements Discussion and Analysis § 37




---



##### 



Amortization Expense
 ($ millions)
    
    
    
    
    
    Increase (decrease)due toFor the years ended
    
    2006
    
    
    Sales
    
    
    
    
    
    
    2005December 31
    
    Amount
    
    
    volumes1
    
    
    Other2
    
    
    Amount
    
    
    Comments on other variancesGold minesNorth America
    
    $
    242
    
    
    $
    15
    
    
    $
    14
    
    
    $
    213
    
    
    Mainly due to amortization of
purchase price adjustment related to property, plant and equipment acquired with Placer Dome.South America
    
    
    127
    
    
    
    47
    
    
    
    (21
    )
    
    
    101
    
    
    Higher amortization included in closing inventory at Pierina, combined with an increase in reserves.Australia Pacific
    
    
    175
    
    
    
    109
    
    
    
    20
    
    
    
    46
    
    
    Mainly due to amortization of purchase price adjustment related to property, plant and equipment acquired with Placer Dome.Africa
    
    
    83
    
    
    
    35
    
    
    
    (1
    )
    
    
    49
    
    
    Impact of capital additions in 2006, more than offset by increase in reserves and amortization of purchase price adjustment related to property, plant and equipment acquired with Placer Dome.Copper minesSouth America
    
    
    49
    
    
    
    34
    
    
    
    15
    
    
    
    
    
    
    Due to amortization of purchase price adjustment related to property, plant and equipment acquired with Placer Dome.Australia Pacific
    
    
    17
    
    
    
    10
    
    
    
    7
    
    
    
    
    
    
    Due to amortization of purchase price adjustment related to property, plant and equipment acquired with Placer Dome.Sub total
    
    
    693
    
    
    $
    250
    
    
    $
    34
    
    
    
    409Corporate assets
    
    
    42
    
    
    
    
    
    
    
    
    
    
    
    18
    
    
    Due to amortization of purchase price adjustment related to supply con- tract intangible assets and property, plant and equipment acquired with Placer Dome.Total
    
    $
    735
    
    
    
    
    
    
    
    
    
    
    $
    427
 Amortization Expense
 ($ millions)
    
    
    
    
    
    Increase (decrease)due toFor the years ended
    
    2005
    
    
    Sales
    
    
    
    
    
    
    2004December 31
    
    Amount
    
    
    volumes1
    
    
    Other2
    
    
    Amount
    
    
    Comments on other variancesGold minesNorth America
    
    $
    213
    
    
    $
    (27
    )
    
    $
    1
    
    
    $
    239
    
    
    Impact of capital additions in 2005, partly offset by increase in reserves.South America
    
    
    101
    
    
    
    (2
    )
    
    
    (4
    )
    
    
    107
    
    
    Mainly due to increase in reserves.Australia Pacific
    
    
    46
    
    
    
    (4
    )
    
    
    5
    
    
    
    45
    
    
    Impact of capital additions in 2005.Africa
    
    
    49
    
    
    
    13
    
    
    
    2
    
    
    
    34
    
    
    Impact of capital additions in 2005.Copper minesSouth America
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Australia Pacific
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Sub total
    
    
    409
    
    
    
    (20
    )
    
    
    4
    
    
    
    425Corporate assets
    
    
    18
    
    
    
    
    
    
    
    
    
    
    
    27Total
    
    $
    427
    
    
    
    
    
    
    
    
    
    
    $
    452
 1.
    
    For explanation of changes in sales volumes refer to page 20.2.
    
    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 60).
 38§ Managements Discussion and Analysis
    
    Barrick Financial Report 2006




---



##### 



Corporate Administration, Interest Income and Interest Expense
 ($ millions)For the years ended December 31
    
    2006
    
    
    2005
    
    
    2004
    
    
    Comments on significant trends and variancesCorporate
administration
    
    $
    142
    
    
    $
    71
    
    
    $
    71
    
    
    2006 vs. 2005  Increase in 2006 relates to the increase in scale of the Company after the Placer Dome acquisition, and stock option expense in 2006 of $18 million.Interest income
    
    
    101
    
    
    
    38
    
    
    
    25
    
    
    2006 vs. 2005  Higher interest income in 2006 was mainly due to higher cash balances in 2006. Also, in the first five months of 2006, a $19 million financing fee was paid by Goldcorp representing, in part,
compensation for interest costs incurred by us to carry the cost of financing related to certain operations sold to Goldcorp. 2005 vs. 2004  Increase in the average cash balance, combined with an increase in market interest rates.Interest costsTotal incurred
    
    
    251
    
    
    
    125
    
    
    
    60
    
    
    2006 vs. 2005  Higher interest costs in 2006 were mainly due to $1.3 billion of debt assumed on the acquisition of Placer Dome, combined with interest relating to funds drawn under a credit facility that were
used for the cash component of the cost of acquisition of Placer Dome and interest paid under our copper-linked notes issued in October 2006. 2005 vs. 2004  Increase mainly due to new financing put in place in 2004 and 2005.Capitalized
    
    
    102
    
    
    
    118
    
    
    
    41
    
    
    2006 vs. 2005  In 2006, interest was capitalized at our development projects, Pascua-Lama, Cowal and Ruby Hill. Also in 2006, we began to capitalize interest costs at projects acquired from third parties
including Cortez Hills, Donlin Creek, Pueblo Viejo, Sedibelo, Reko Diq and Buzwagi. 2005 vs. 2004  Increased amounts were capitalized in 2005 at Pascua-Lama, Cowal, Veladero, and Lagunas Norte development projects as construction costs were
incurred
 and capitalized. Capitalization of interest at Lagunas Norte ceased in third quarter 2005, while capitalization of interest at Veladero ceased in fourth quarter 2005.Interest expense allocated to
discontinued operations
    
    
    23
    
    
    
    
    
    
    
    
    
    
    Primarily relates to interest allocated to South Deep.Expensed
    
    $
    126
    
    
    $
    7
    
    
    $
    19
    
    
    2006 vs. 2005  Higher interest costs in 2006 were mainly due to higher levels of debt outstanding after debt assumed with the acquisition of Placer Dome combined with lower amounts of interest capitalized to
development projects in 2006 compared to 2005.
 Barrick Financial Report 2006
    
    Managements Discussion and Analysis § 39




---



##### 



Other Operating Expenses
 ($ millions)For the years ended December 31
    
    2006
    
    
    2005
    
    
    2004
    
    
    Comments on significant trends and variancesRegional business unit overheads
    
    $
    88
    
    
    $
    36
    
    
    $
    24
    
    
    2006 vs. 2005  Higher overhead costs incurred in 2006 due to impact of the acquisition of Placer Dome, including: increase in headcount at regional head offices; IT costs associated with coordinating and
standardizing communications and network systems; and recruitment and relocation costs.Community development costs
    
    
    15
    
    
    
    
    
    
    
    
    
    
    Relates to amounts accrued for a voluntary contribution to be paid to benefit Peruvian communities and amounts to be paid under a Mining Development Agreement to the Tanzanian Government.Environmental remediation cost
    
    
    8
    
    
    
    13
    
    
    
    14World Gold Council fees
    
    
    13
    
    
    
    10
    
    
    
    9
    
    
    Higher production levels in 2005 and 2006Total
    
    $
    124
    
    
    $
    59
    
    
    $
    47
 Impairment of Long-lived Assets
 ($ millions)For the years ended December 31
    
    2006
    
    
    2005
    
    
    2004
    
    
    Comments on significant trends and variancesEskay Creek
    
    $
    
    
    
    $
    
    
    
    $
    58
    
    
    In 2004, we completed an impairment test for the Eskay Creek mine, due to a downward revision to reserves, the continued weakening of the US dollar that impacts Canadian dollar operating costs, and upward revisions
in asset retirement obligation costs.Peruvian exploration properties
    
    
    17
    
    
    
    
    
    
    
    67
    
    
    In 2006, the carrying amount of Cuerpo Sur, an extension of Pierina, was tested for impairment on completion of the annual life of mine planning process. An impairment charge of $17 million was recorded to reduce
the carrying amount to the estimated fair value. In 2004, we completed an impairment test on a group of Peruvian exploration-stage properties based on finalization of the exploration program for the year and an updated assessment of future plans for
the
 property.Other
    
    
    
    
    
    
    
    
    
    
    14
    
    
    2004 includes write-down on various exploration-stage properties.Total
    
    $
    17
    
    
    $
    
    
    
    $
    139
 40§ Managements Discussion and Analysis
    
    Barrick Financial Report 2006




---



##### 



Other Income
 ($ millions)For the years ended December 31
    
    2006
    
    
    2005
    
    
    2004
    
    
    Comments on significant trends and variancesNon-hedge derivative gains
    
    $
    
    
    
    $
    6
    
    
    $
    5Gains on asset sales
    
    
    9
    
    
    
    5
    
    
    
    36
    
    
    In 2006, we sold various properties in Canada and Chile. In 2005, we sold certain land positions in Australia. In 2004, we sold various mining properties, including the Holt-McDermott mine in Canada and certain land
positions around our inactive mine sites in the United States.Gains on investment sales
    
    
    6
    
    
    
    17
    
    
    
    6
    
    
    $10 million of the gains recorded in 2005 related to the sale of investments held in a rabbi trust for a deferred compensation plan. Other gains in all years mainly relate to the sale of various other
investments.Gain on Kabanga transaction
    
    
    
    
    
    
    15
    
    
    
    
    
    
    Gain recorded in 2005 relates to the closing of a transaction with Falconbridge relating to Kabanga.Gain on vend-in of assets
to Highland Gold
    
    
    51
    
    
    
    
    
    
    
    
    
    
    In 2006 we exchanged various interests in mineral properties for 34.3 million Highland shares with a fair value that exceeded the carrying amount of assets exchanged by $76 million, resulting in a gain of $51
million.Royalty income
    
    
    10
    
    
    
    6
    
    
    
    2Sale of water rights
    
    
    5
    
    
    
    
    
    
    
    Other
    
    
    8
    
    
    
    
    
    
    
    Total
    
    $
    89
    
    
    $
    49
    
    
    $
    49
 Other Expense
 ($ millions)For the years ended December 31
    
    2006
    
    
    2005
    
    
    2004
    
    
    Comments on significant trends and variancesImpairment charges
on investments
    
    $
    6
    
    
    $
    16
    
    
    $
    5
    
    
    2006 impairment charge relates to the write-down of two investments, both of which were considered to be impaired. 2005 impairment charge relates to the write-down of two investments which were determined to be
impaired.Changes in AROs at closed mines
    
    
    53
    
    
    
    15
    
    
    
    22
    
    
    In 2006, we recorded charges for changes in estimates of Asset Retirement Obligations ("AROs") at closed mines of $37 million for the Nickel Plate property in British Columbia, Canada and $16 million for other
properties.Accretion expense at closed mines
    
    
    8
    
    
    
    10
    
    
    
    7Currency translation (gains) losses
    
    
    (2
    )
    
    
    (3
    )
    
    
    1Placer Dome integration costs
    
    
    12
    
    
    
    
    
    
    
    Corporate transaction costs
    
    
    7
    
    
    
    
    
    
    
    Other items
    
    
    12
    
    
    
    18
    
    
    
    12
    
    
    2005 and 2004 include litigation costs for major litigations.Total
    
    $
    96
    
    
    $
    56
    
    
    $
    47
 Barrick Financial Report 2006
    
    Managements Discussion and Analysis § 41




---



##### 



Income Taxes
 
 2006
    
    
    2005
    
    
    2004Income tax
    
    
    
    
    
    
    
    
    
    
    Income tax
    
    
    
    
    
    
    
    
    
    
    Income taxEffective income tax rates
    
    Pre-tax
    
    
    Effective
    
    
    expense
    
    
    Pre-tax
    
    
    Effective
    
    
    expense
    
    
    Pre-tax
    
    
    Effective
    
    
    expenseon elements of income
    
    income
    
    
    tax rate
    
    
    (recovery)
    
    
    income
    
    
    tax rate
    
    
    (recovery)
    
    
    income
    
    
    tax rate
    
    
    (recovery)Income tax expense
before elements below
    
    $
    1,560
    
    
    
    27
    %
    
    $
    420
    
    
    $
    462
    
    
    
    21
    %
    
    $
    97
    
    
    $
    43
    
    
    
    56
    %
    
    $
    24Change in Australian tax status
    
    
    
    
    
    
    
    
    
    
    (31
    )
    
    
    
    
    
    
    
    
    
    
    (5
    )
    
    
    
    
    
    
    
    
    
    
    (81
    )Tax rate changes
    
    
    
    
    
    
    
    
    
    
    12
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Outcome of tax uncertainties
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (141
    )Release of deferred
tax valuation allowances
recorded in prior years
    
    
    
    
    
    
    
    
    
    
    (53
    )
    
    
    
    
    
    
    
    
    
    
    (32
    )
    
    
    
    
    
    
    
    
    
    
    (5
    )Total
    
    
    
    
    
    
    
    
    
    $
    348
    
    
    
    
    
    
    
    
    
    
    $
    60
    
    
    
    
    
    
    
    
    
    
    $
    (203
    )
     42§ Managements Discussion and Analysis
    
    Barrick Financial Report 2006




---



##### 



Quarterly Information
 2006
    
    
    2005Q4
    
    
    Q3
    
    
    Q2
    
    
    Q1
    
    
    Q4
    
    
    Q3
    
    
    Q2
    
    
    Q1Sales
    
    $
    1,348
    
    
    $
    1,573
    
    
    $

1,5111
    
    
    $

1,2041
    
    
    $
    776
    
    
    $
    627
    
    
    $
    463
    
    
    $
    484Net income from continuing operations
    
    
    132
    
    
    
    393
    
    
    
    458
    
    
    
    226
    
    
    
    175
    
    
    
    113
    
    
    
    47
    
    
    
    60Net income from continuing operations per
share  basic (dollars)
    
    
    0.15
    
    
    
    0.46
    
    
    
    0.53
    
    
    
    0.29
    
    
    
    0.33
    
    
    
    0.21
    
    
    
    0.09
    
    
    
    0.11Net income from continuing operations per
share  diluted (dollars)
    
    
    0.15
    
    
    
    0.45
    
    
    
    0.52
    
    
    
    0.29
    
    
    
    0.32
    
    
    
    0.21
    
    
    
    0.09
    
    
    
    0.11Net income
    
    
    418
    
    
    
    405
    
    
    
    459
    
    
    
    224
    
    
    
    175
    
    
    
    113
    
    
    
    47
    
    
    
    66Net income per share  basic (dollars)
    
    
    0.48
    
    
    
    0.47
    
    
    
    0.53
    
    
    
    0.29
    
    
    
    0.33
    
    
    
    0.21
    
    
    
    0.09
    
    
    
    0.12Net income per share  diluted (dollars)
    
    
    0.48
    
    
    
    0.46
    
    
    
    0.53
    
    
    
    0.29
    
    
    
    0.32
    
    
    
    0.21
    
    
    
    0.09
    
    
    
    0.12
 1.
    
    Adjusted for the impact of reclassifying sales from our South Deep mine to discontinued
operations.
  Barrick Financial Report 2006
    
    Managements Discussion and
Analysis §   43




---



##### 



Fourth Quarter Results
   Effect on Earnings Increase (Decrease)
 Three months ended December 31($ millions)
    
    2006
    
    
    2005Pre-tax
    
    
    Post-tax
    
    
    Pre-tax
    
    
    Post-taxNon-hedge derivative
gains (losses)
    
    $
    5
    
    
    $
    11
    
    
    $
    (1
    )
    
    $
    (1
    )Gain on sale of South Deep
    
    
    288
    
    
    
    288
    
    
    
    
    
    
    
    Impairment charges on
long-lived assets
and investments
    
    
    (23
    )
    
    
    (18
    )
    
    
    (13
    )
    
    
    (13
    )Inventory purchase
accounting adjustments
    
    
    (25
    )
    
    
    (21
    )
    
    
    
    
    
    
    Change in asset retirement
obligation estimates
    
    
    (15
    )
    
    
    (10
    )
    
    
    (2
    )
    
    
    (3
    )Deferred tax credits
Change in Australian
tax status
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    5Highland vend-in
    
    
    51
    
    
    
    51
    
    
    
    
    
    
    
    Peru voluntary contribution
    
    
    (8
    )
    
    
    (6
    )
    
    
    
    
    
    
    Opportunity cost of deliveries
into fixed-price Corporate
Gold Sales Contracts
    
    
    (327
    )
    
    
    (312
    )
    
    
    (33
    )
    
    
    (33
    )Hedge accounting adjustments
related to the acquired
Placer Dome gold
hedge position
    
    
    (18
    )
    
    
    (11
    )
    
    
    
    
    
    
    Total
    
    $
    (72
    )
    
    $
    (28
    )
    
    $
    (49
    )
    
    $
    (45
    )
  44 § Managements Discussion and Analysis
    
    Barrick Financial Report 2006




---



##### 



Liquidity, Capital Resources and Financial Position
 Cash Flow
 Operating Activities
  Key Factors Affecting Operating Cash Flow
 Impact on comparative($ millions)
    
    
    
    
    
    
    
    
    
    
    
    
    
    operating cash flowsFor the years ended
    
    
    
    
    
    
    
    
    
    
    
    
    
    2006 vs.
    
    2005 vs.December 31
    
    2006
    
    2005
    
    2004
    
    2005
    
    2004
    
    Comments on significant trends and variancesGold sales volumes (000s oz)
    
    
    8,390
    
    
    
    5,320
    
    
    
    4,936
    
    
    $
    666
    
    
    $
    75
    
    
    See page 20Market gold prices ($/oz)
    
    
    604
    
    
    
    444
    
    
    
    409
    
    
    
    1,342
    
    
    
    186
    
    
    See page 7Impact of gold sales contracts
    
    
    532
    
    
    
    56
    
    
    
    89
    
    
    
    (476
    )
    
    
    33
    
    
    See page 7Higher copper earnings
(millions lbs)
    
    
    376
    
    
    
    
    
    
    
    
    
    
    
    833
    
    
    
    
    
    
    See page 20Total cash costs gold ($/oz)
    
    
    282
    
    
    
    227
    
    
    
    214
    
    
    
    (461
    )
    
    
    (69
    )
    
    See page 20Sub-total
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    1,904
    
    
    
    225Other inflows (outflows)Higher expenses1
    
    
    556
    
    
    
    271
    
    
    
    259
    
    
    
    (285
    )
    
    
    (12
    )Purchase of copper put options
    
    
    26
    
    
    
    
    
    
    
    
    
    
    
    (26
    )
    
    
    Non-cash working capital
    
    
    42
    
    
    
    (66
    )
    
    
    (86
    )
    
    
    108
    
    
    
    20
    
    
    2006 vs. 2005  Increase in taxes payable. 2005 vs. 2004  Increase
in accounts payable in 2005 mainly due to timing of payments and
for mines that began production in 2005.Interest expense
    
    
    126
    
    
    
    7
    
    
    
    19
    
    
    
    (119
    )
    
    
    12
    
    
    See page 39Income tax payments
    
    
    280
    
    
    
    80
    
    
    
    45
    
    
    
    (200
    )
    
    
    (35
    )
    
    2006 vs. 2005  Increased payments in 2006 related to acquisition
of Placer Dome. 2005 vs. 2004  Increased payments in 2005 related
to higher gold prices and the start of Lagunas Norte production.Effect of other factors
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    14
    
    
    
    7Total
    
    
    
    
    
    
    
    
    
    
    
    
    
    $
    1,396
    
    
    $
    217
 1.
    
    Includes corporate administration, exploration, project development, and other operating
expenses.
 Barrick Financial Report 2006
    
    Managements Discussion and
Analysis §   45




---



##### 



Investing Activities
 ($ millions)For the years endedDecember 31
    
    2006
    
    2005
    
    2004
    
    CommentsProject capital expenditures1Pascua-Lama 
development costs
    
    $
    113
    
    
    $
    98
    
    
    $
    35
    
    
    Higher levels of activity since decision in mid-2004 to proceed with the project, as well
as capitalized interest since mid-2004.Cowal construction
    
    
    104
    
    
    
    258
    
    
    
    73
    
    
    Production start-up in second
quarter 2006 after a two-year construction phase, which began in second quarter 2004.Ruby Hill development costs
    
    
    29
    
    
    
    35
    
    
    
    
    
    
    Construction activity started in first quarter 2005.Cortez Hills
    
    
    26
    
    
    
    
    
    
    
    
    
    
    Construction activity at mine acquired with Placer Dome.Tulawaka construction
    
    
    
    
    
    
    5
    
    
    
    48
    
    
    Production start-up in first quarter 2005.Veladero construction
    
    
    
    
    
    
    213
    
    
    
    284
    
    
    Production start-up in fourth quarter 2005.Lagunas Norte construction
    
    
    
    
    
    
    100
    
    
    
    182
    
    
    Construction activity started in second quarter 2004. Production start-up in second
quarter 2005.Western 102 Power Plant
    
    
    
    
    
    
    80
    
    
    
    18
    
    
    Construction activity started in first quarter 2004. Production start-up in fourth quarter 2005.Other
    
    
    13
    
    
    
    
    
    
    
    
    
    
    Relates primarily to capitalized interest at Donlin Creek, Pueblo Viejo, Reko Diq,
Sedibelo and Buzwagi.Sub total
    
    
    285
    
    
    
    789
    
    
    
    640Regional capital expendituresNorth America
    
    
    202
    
    
    
    103
    
    
    
    86
    
    
    2006 vs. 2005  Higher expenditures due to the impact of Bald Mountain, Turquoise
Ridge and Golden Sunlight, partly offset by lower expenditures at Marigold. 2005 vs.
2004  Higher regional capital expenditures at Goldstrike in 2005, in particular, a 100-
ton shovel purchase and higher budgeted expenditures in general.South America
    
    
    248
    
    
    
    114
    
    
    
    8
    
    
    2006 vs. 2005  Higher expenditures in 2006 due to expenditures at Veladero related
to capitalized pre-production stripping of the Filo Federico pit, combined with expen-
ditures at Lagunas Norte and Zaldívar. 2005 vs. 2004  Purchases of equipment at
new mines.Australia Pacific
    
    
    255
    
    
    
    50
    
    
    
    37
    
    
    2006 vs. 2005  Higher expenditures due to the impact of Placer Dome mines, includ-
ing $79 million spent at Porgera primarily related to the remediation of the West
Wall cutback.Africa
    
    
    85
    
    
    
    40
    
    
    
    46
    
    
    2006 vs. 2005  Higher expenditures in 2006 due to the impact of North Mara and
higher expenditures at Bulyanhulu to install a carbon-in-leach plant.Other
    
    
    12
    
    
    
    8
    
    
    
    7Sub total
    
    
    802
    
    
    
    315
    
    
    
    184Total
    
    $
    1,087
    
    
    $
    1,104
    
    
    $
    824
 1.
    
    Includes both construction costs and capitalized interest.
  46   § Managements Discussion and Analysis
    
    Barrick Financial Report 2006




---



##### 



Financing Activities
  Liquidity
 Liquidity Management
   Capital Resources
   Barrick Financial Report 2006
    
    Managements Discussion and
Analysis  §   47




---



##### 



Capital Resources 1
 ($ millions)For the years ended December 31
    
    2006
    
    
    2005
    
    
    2004Opening capital resources
    
    $
    2,084
    
    
    $
    2,476
    
    
    $
    1,970New sourcesOperating cash flow
    
    
    2,122
    
    
    
    726
    
    
    
    509New and increases to financing facilities2
    
    
    1,550
    
    
    
    134
    
    
    
    1,056Proceeds from asset sales
    
    
    2,850
    
    
    
    
    
    
    
    8,606
    
    
    
    3,336
    
    
    
    3,535UsesAcquisition of Placer Dome
    
    
    (160
    )
    
    
    
    
    
    
    Other acquisitions3
    
    
    (364
    )
    
    
    
    
    
    
    Settlement of acquired Placer Dome hedge position
and repayment of debt4
    
    
    (2,254
    )
    
    
    
    
    
    
    Project capital5
    
    
    (285
    )
    
    
    (789
    )
    
    
    (640
    )Regional capital5
    
    
    (802
    )
    
    
    (315
    )
    
    
    (184
    )Dividends
    
    
    (191
    )
    
    
    (118
    )
    
    
    (118
    )Share buyback
    
    
    
    
    
    
    
    
    
    
    (95
    )Other
    
    
    48
    
    
    
    (30
    )
    
    
    (22
    )Closing capital resources
    
    $
    4,598
    
    
    $
    2,084
    
    
    $
    2,476Components of closing capital resourcesCash and equivalents
    
    $
    3,043
    
    
    $
    1,037
    
    
    $
    1,398Unutilized credit facilities6
    
    
    1,555
    
    
    
    1,047
    
    
    
    1,078Total
    
    $
    4,598
    
    
    $
    2,084
    
    
    $
    2,476
 1.
    
    Capital resources include cash balances
and sources of financing that have been arranged
but not utilized.2.
    
    In 2006, includes a second $50 million
Peruvian bond offering, $500 million increase
in our first credit facility and the issuance
of $1 billion of copper-linked notes. In 2005, includes the first $50 million Peruvian bond
offering and $84 million lease facility for
Lagunas Norte. In 2004, includes the $250
million Veladero project financing, $750
million bond offering, and $56 million lease
facility for Lagunas Norte.3.
    
    Includes acquisition of equity method
investments, changes in available-for-sale
securities and other acquisitions, net of cash
acquired.4.
    
    Represents $1,840 million paid to settle
acquired Placer Dome hedge positions, $337 million
repayment of acquired Placer Dome credit facility
after which it was terminated, and $77 million
related to the redemption of Placer Dome preferred
shares.5.
    
    Project capital represents capital invested in
new projects to bring new mines into production.
Regional capital represents ongoing capital
required at existing mining operations. Sum of
project and regional capital equals capital
expenditures for the year.6.
    
    Represents available amounts under our first
credit facility of $1.5 billion and $55 million
available on Peruvian lease facilities.
 Credit Rating
 At February 21, 2007 from major rating agencies:Standard and Poors (S&P)
    
    
    AMoodys
    
    Baa1DBRS
    
    
    A
  Financial Position
 Key Balance Sheet Ratios
 As at December 31
    
    2006
    
    
    2005Non-cash working capital ($ millions) 1
    
    $
    764
    
    
    $
    231Net debt ($ millions) 2
    
    $
    1,064
    
    
    $
    764Net debt-to-equity ratio3
    
    
    0.07:1
    
    
    
    0.20:1Current ratio 4
    
    
    4.85:1
    
    
    
    3.64:1
 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.
  48  § Managements Discussion and Analysis
    
    Barrick Financial Report 2006




---



##### 



Shareholders Equity
 Outstanding Share Data
 Conversion forShares
    
    
    Barrick commonoutstanding
    
    
    sharesAs at February 7, 2007
    
    No. of sharesCommon shares
    
    
    863,957,797Special voting shares
    
    
    1Exchangeable shares1
    
    
    1,366,015
    
    
    
    723,989Stock options
    
    
    18,406,815
 1.
    
    Represents Barrick Gold Inc. (BGI)
exchangeable shares. Each BGI share is
exchangeable for 0.53 Barrick common shares.
  Dividend Policy
  Contractual Obligations and Commitments
 Comprehensive Income
    Payments due($ millions)
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    2012 andAt December 31, 2006
    
    2007
    
    
    2008
    
    
    2009
    
    
    2010
    
    
    2011
    
    
    thereafter
    
    
    TotalLong-term debt (1)Repayment of principal
    
    $
    737
    
    
    $
    97
    
    
    $
    101
    
    
    $
    52
    
    
    $
    25
    
    
    $
    2,883
    
    
    $
    3,895Interest
    
    
    225
    
    
    
    193
    
    
    
    185
    
    
    
    178
    
    
    
    175
    
    
    
    2,664
    
    
    
    3,620Asset retirement obligations (2)
    
    
    42
    
    
    
    64
    
    
    
    114
    
    
    
    79
    
    
    
    58
    
    
    
    536
    
    
    
    893Capital leases
    
    
    20
    
    
    
    16
    
    
    
    16
    
    
    
    16
    
    
    
    16
    
    
    
    5
    
    
    
    89Operating leases
    
    
    6
    
    
    
    2
    
    
    
    1
    
    
    
    1
    
    
    
    
    
    
    
    
    
    
    
    10Restricted share units
    
    
    6
    
    
    
    10
    
    
    
    27
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    43Other post-retirement obligations
    
    
    11
    
    
    
    6
    
    
    
    3
    
    
    
    3
    
    
    
    3
    
    
    
    18
    
    
    
    44Derivative liabilities (3)
    
    
    82
    
    
    
    35
    
    
    
    2
    
    
    
    111
    
    
    
    2
    
    
    
    
    
    
    
    232Royalty arrangements (4)
    
    
    167
    
    
    
    175
    
    
    
    171
    
    
    
    158
    
    
    
    137
    
    
    
    935
    
    
    
    1,743Purchase obligations for supplies
and consumables (5)
    
    
    261
    
    
    
    150
    
    
    
    33
    
    
    
    130
    
    
    
    7
    
    
    
    
    
    
    
    581Capital commitments (6)
    
    
    116
    
    
    
    1
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    117Total
    
    $
    1,673
    
    
    $
    749
    
    
    $
    653
    
    
    $
    728
    
    
    $
    423
    
    
    $
    7,041
    
    
    $
    11,267
 Barrick Financial Report 2006
    
    Managements Discussion and
Analysis  § 49




---



##### 



(1) Long-term Debt and Interest
  (2) Asset Retirement Obligations
  (3) Derivative Liabilities
  (4) Royalties
  (5) Purchase Obligations for
Supplies and Consumables
  (6) Capital Commitments
  Capital Expenditures Not Yet Committed
  Payments to Maintain Land Tenure and Mineral
Property Rights
  50  § Managements Discussion and Analysis
    
    Barrick Financial Report 2006




---



##### 



Contingencies  Litigation
  Financial Instruments
  Summary of Financial Instruments 1
 Principal/
    
    
    
    
    
    Amounts NotFinancial
    
    Notional
    
    Associated
    
    Amounts Recorded
    
    Recorded inInstrument
    
    Amount
    
    Risks
    
    in Earnings
    
    EarningsCash and equivalents
    
    $3,043 million
    
§  Interest rate
    
    Interest income less hedge gains on cash
    
    $Nil§  Credit
    
    hedging instruments  2006  $102 million;2005  $32 million; 2004  $6 millionInvestments in available-
    
    $646 million
    
§  Market
    
    Other income/expense  2006 
    
    $53 millionfor-sale securities
    
    
    
    
    
    $2 million gain; 2005  $1 million gain;
    
    gain in OCI2004  $1 million gainLong-term debt
    
    $3,244 million
    
§  Interest rate
    
    Interest costs  2006  $126 million expensed
    
    Carrying value($102 million capitalized); 2005  $7 million
    
    greater thanexpensed ($118 million capitalized); 2004 
    
    fair value by$19 million expensed ($41 million capitalized)
    
    $60 millionHedging instruments 
    
    C$586 million
    
§  Market/Liquidity
    
    Hedge gains in cost of sales, corporate
    
    $208 millioncurrency contracts
    
    A$2,867 million
    
§  Credit
    
    administration and amortization 
    
    in OCIZAR 46 million
    
    
    
    2006  $102 million; 2005  $120 million;2004  $112 millionCopper hedges
    
    300 million
    
§  Market/Liquidity
    
    $28 loss in revenue
    
    $57 millionpounds
    
§  Credit
    
    
    
    gain in OCIAcquired Placer Dome
    
    Nil ounces
    
§  Market/Liquidity
    
    $165 loss in revenue
    
    $17 milliongold hedges
    
    
    
§  Credit
    
    
    
    gain in OCIHedging instruments 
    
    Fuel 
    
§  Market/Liquidity
    
    Hedge gains in cost of sales  2006 
    
    $21 millionfuel and propane contracts
    
    4 million barrels
    
§  Credit
    
    $16 million; 2005  $10 million;
    
    gain in OCIPropane 
    
    
    
    2004  $4 million18 million gallonsDebt hedging instruments 
    
    $500 million
    
§  Market/Liquidity
    
    Change in fair value recorded in earnings 
    
    $17 millioninterest rate contracts
    
    
    
§  Credit
    
    2006  $1 million loss; 2005  $13 million
    
    loss in OCIloss; 2004  $2 million gainCash hedging instruments 
    
    $Nil
    
§  Market/Liquidity
    
    Hedge gains/losses in interest income 
    
    $3 million lossinterest rate contracts
    
    
    
§  Credit
    
    2006  $1 million loss; 2005  $6 million
    
    in OCIgain; 2004  $19 million gainNon-hedge derivatives
    
    Various
    
§  Market/Liquidity
    
    Gains in other income/expense  2006  $nil;
    
    $Nil§  Credit
    
    2005  $6 million; 2004  $5 million
 1.
    
    Refer to pages 52 to 55 for information on gold and silver sales contracts.
 Barrick Financial Report 2006
    
    Managements Discussion and
Analysis §  51




---



##### 



Placer Dome Gold Hedge Position
   Off Balance Sheet Arrangements
   52  § Managements Discussion and Analysis
    
    Barrick Financial Report 2006




---



##### 



Project Gold Sales Contracts
   Key Aspects of Project Gold Sales Contracts
 As of December 31, 2006Expected delivery dates1
    
    20102019, the approximate
terms of the expected financingFuture estimated average 
realizable selling price
    
    $391/oz2Mark-to-market value at
December 31, 2006
    
    ($3,187) million3
 1.
    
    The contract termination dates are in
2016 in most cases, but we currently expect to
deliver production against these contracts
starting in 2010, subject to 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 2010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 $632 per ounce and market interest rates.
    Barrick Financial Report 2006
    
    Managements Discussion and
Analysis §  53




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##### 



Corporate Gold Sales Contracts and Floating
Spot-Price Gold Sales Contracts
   Fixed-Price Silver Sales Contracts
 As of December 31, 2006Millions of silver ounces
    
    13Current termination date of silver sales contracts
    
    2016 in most casesAverage estimated realizable selling price at 2016
termination date
    
    $8.42/oz1Mark-to-market value at December 31, 2006
    
    ($82) million2
 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 $12.90 per ounce.
  Key Terms of Gold and Silver Sales Contracts
  §
    
    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 15 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 2016 in most cases).
 54  § Managements Discussion and Analysis
    
    Barrick Financial Report 2006




---



##### 



§
    
    We must maintain a minimum consolidated net
worth of at least $2 billion; it was $8.3 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 2:1; it was
0.5:1 at year end.
   Fair Value of Derivative Positions
 As at December 31, 2006
    
    Unrealized($ millions)
    
    Gain/(Loss)Corporate Gold Sales Contracts
    
    $
    (387
    )Project Gold Sales Contracts
    
    
    (3,187
    )Floating Spot-Price Gold Sales Contracts
    
    
    (260
    )Silver Sales Contracts
    
    
    (82
    )Floating Spot-Price Silver Sales Contracts
    
    
    (18
    )Foreign currency contracts
    
    
    176Interest rate and gold lease contracts
    
    
    49Fuel contracts
    
    
    29Gold positions offset but not financially settled1
    
    
    (160
    )Copper contracts
    
    
    81Total
    
    $
    (3,759
    )
 1.
    
    These are acquired Placer Dome contracts
which have been economically offset, but not yet
settled. Upon settlement, there will be a cash
impact of approximately negative $160 million, but
no material impact on earnings as the contract
values were captured as part of the fair value of
assets and liabilities recorded upon acquisition
of Placer Dome.
 Critical Accounting Policies and Estimates
   Barrick Financial Report 2006
    
    Managements Discussion and
Analysis  § 55




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##### 



Accounting Policy Changes in 2006
  FAS
123R, Share-Based Payment (FAS 123R)
     FAS 151, Inventory Costs (FAS 151)
  56  § Managements Discussion and Analysis
    
    Barrick Financial Report 2006




---



##### 



FAS
158, EmployersAccounting for Defined Benefit Pension and Other Post-retirement Plans
(FAS 158)
   a)
    
    Recognize in its balance sheet an asset for a plans overfunded status or a liability for the
plans underfunded status.
 b)
    
    Recognize as a component of other comprehensive income, the existing unrecognized net gains
or losses, unrecognized prior service costs or credits and unrecognized net transition assets
or obligations.
 c)
    
    Measure defined benefit plan assets and obligations as of the date of the employers fiscal
year-end balance sheet (with limited exceptions).
  Staff
Accounting Bulletin No. 108  Considering the effects of Prior Year Misstatements when
Quantifying Misstatements in Current Year Financial Statements (SAB 108)
  Future Accounting Policy Changes
  FASB
Interpretation No. 48, Accounting for Uncertainty in Income Taxes
 an interpretation of FASB
Statement No. 109 (FIN 48)
   Barrick Financial Report 2006
    
    Managements Discussion and Analysis § 57




---



##### 



FAS 157 Fair Value Measurements (FAS 157)
   FSP
No. AUG AIR-1  Accounting for Planned Major Maintenance Activities (FSP AIR-1)
  58 § Managements Discussion and Analysis
    
    Barrick Financial Report 2006




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##### 



Critical Accounting Estimates and Judgments
  Reserve
Estimates Used to Measure Amortization of Property, Plant and Equipment
    §
    
    Underground development costs incurred to access ore at underground mines are significant
and amortized using the units-of-production method; and§
    
    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.
 Barrick Financial Report 2006
    
    Managements Discussion and Analysis § 59




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##### 



Impact of Historic Changes in Reserve Estimates on Amortization
 2006
    
    
    2005Reserves
    
    
    Amortization
    
    
    Reserves
    
    
    AmortizationFor the years ended December 31
    
    increase
    
    
    increase
    
    
    increase
    
    
    increase($ millions, except reserves in millions of contained oz)
    
    (decrease)1
    
    
    (decrease)
    
    
    (decrease)1
    
    
    (decrease)North America
    
    
    1.7
    
    
    $
    (6
    )
    
    
    2.4
    
    
    $
    (3
    )South America
    
    
    0.1
    
    
    
    (35
    )
    
    
    0.3
    
    
    
    (22
    )Australia Pacific
    
    
    0.6
    
    
    
    (16
    )
    
    
    0.2
    
    
    
    (3
    )Africa
    
    
    3.0
    
    
    
    (18
    )
    
    
    0.1
    
    
    
    Total
    
    
    5.4
    
    
    $
    (75
    )
    
    
    3.0
    
    
    $
    (28
    )
 
 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 Investments
  Impairment Assessments of Operating Mines, Development Projects and Exploration Stage Properties
   §
    
    Estimated sales proceeds from the production and sale of recoverable ounces of gold or pounds
of copper contained in proven and probable reserves;§
    
    Expected future commodity prices and currency exchange rates (considering historical and
current prices, price trends and related factors);§
    
    Expected future operating costs and capital expenditures to produce proven and probable gold
or copper reserves based on mine plans that assume current plant
capacity, but exclude the impact of
inflation;§
    
    Expected cash flows associated with
value beyond proven and probable reserves, which includes
the expected cash outflows required to develop and extract the value beyond proven and probable
reserves; and§
    
    Environmental remediation costs excluded from the measurement of asset retirement obligations.
  60 § Managements Discussion and Analysis
    
    Barrick Financial Report 2006




---



##### 



Impairment Assessments of Goodwill
  Barrick Financial Report 2006
    
    Managements Discussion and Analysis § 61




---



##### 



Production Start Date
  §
    
    The level of capital expenditures compared to construction cost estimates§
    
    Completion of a reasonable period of testing of mine plant and equipment§
    
    Ability to produce minerals in saleable form (within specifications)§
    
    Ability to sustain ongoing production of minerals
  Fair
Value of Asset Retirement Obligations (AROs)
  62 § Managements Discussion and Analysis
    
    Barrick Financial Report 2006




---



##### 



AROs at December 31, 2006
 ($ millions)Operating mines
    
    $
    683Closed mines
    
    
    200Development projects
    
    
    10Total
    
    $
    893
 Barrick Financial Report 2006
    
    Managements Discussion and
Analysis §63




---



##### 



Deferred Tax Assets and Liabilities
 Measurement of Temporary Differences
  Valuation Allowances
    Valuation allowances at December 31
 ($ millions)
    
    2006
    
    2005United States
    
    $
    211
    
    
    $
    209Chile
    
    
    110
    
    
    
    124Argentina
    
    
    46
    
    
    
    46Canada
    
    
    59
    
    
    
    63Tanzania
    
    
    217
    
    
    
    204Australia
    
    
    2
    
    
    
    2Other
    
    
    13
    
    
    
    8Total
    
    $
    658
    
    
    $
    656
 United States:
 Chile and Argentina:
 Canada:
 64 § Managements Discussion and Analysis
    
    Barrick Financial Report 2006




---



##### 



Tanzania:
 Cautionary
Statement on
Forward-Looking Information
   Barrick Financial Report 2006
    
    Managements Discussion and
Analysis §   65




---



##### 



GLOSSARY OF TECHNICAL TERMS
 AUTOCLAVE:
 BACKFILL
 BY-PRODUCT:
 CONCENTRATE:
 CONTAINED OUNCES:
 CONTANGO:
 DEVELOPMENT:
 DILUTION:
 DORÉ:
 DRILLING:
 Core:
 In-fill:
 EXPLORATION:
 GRADE:
 Cut-off grade:
 Mill-head grade:
 Recovered grade:
 Reserve grade:
 HEAP LEACHING:
 HEAP LEACH PAD:
 MILL:
 66 § Managements Discussion and Analysis
    
    Barrick Financial Report 2006




---



##### 



MINERAL RESERVE:
 MINERAL RESOURCE:
 MINING CLAIM:
 MINING RATE:
 OPEN PIT:
 ORE:
 ORE BODY:
 OUNCES:
 RECLAMATION:
 RECOVERY RATE:
 REFINING:
 STRIPPING:
 TAILINGS:
 Barrick Financial Report 2006
    
    Managements Discussion and
Analysis §  67