S&P rates Barrick Gold notes A-

Standard & Poor's said it assigned an A- debt rating to the $1.25 billion unsecured notes, $400 million at 4.95% due 2020 and $850 million at 5.95% due 2039, issued by Barrick (PD) Australia Finance Pty Ltd. and guaranteed by Barrick Gold Corp.

The A- long-term corporate credit rating on Barrick is unchanged.

The outlook is stable.

Ratings reflect the company's position as the world's largest gold producer, with a broad base of operations, below-average cash costs and a modest financial risk profile characterized by strong profitability and liquidity, the agency said.

These strengths are counterbalanced by the company's narrow product diversity and the attendant exposure to volatile gold and copper prices, rising operating costs and large capital expenditure plans, the agency said.

If prices drop to below the base-case assumption for 2010 in the current phase of mine construction, the consequent negative free flow could push net debt-to-EBITDA ratio up to 2x and total debt-to-EBITDA ratio to 2.5x, which could pressure the ratings or outlook, the agency said.

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