Exhibit 2.1
[Barrick Gold Corporation Letterhead]
October 27, 2004
Ontario Securities Commission
P. O. Box 55, Suite 800
20 Queen Street West
Toronto, Ontario
M5H 3S8
Dear Sirs:
Re: | Barrick Gold Corporation Preliminary Short-Form Base Shelf Prospectus dated October 27, 2004 Calculation of Interest Coverage |
The earnings of Barrick Gold Corporation (the “Corporation”) available to meet interest requirements on outstanding debt for the twelve month periods ended December 31, 2003 and September 30, 2004 are as follows:
Twelve months | Twelve months | |||||||
ended | ended | |||||||
December 31, 2003 | September 30, 2004 | |||||||
(in millions of | (in millions of | |||||||
U.S. dollars) | U.S. dollars) | |||||||
Calculation of Interest Coverage | ||||||||
Net income | $ | 200 | $ | 169 | ||||
Add (deduct): | ||||||||
Income tax expense (recovery) | 5 | (4 | ) | |||||
Interest expense | 44 | 26 | ||||||
Earnings available to meet interest requirements | $ | 249 | $ | 191 | ||||
Interest incurred(1) | $ | 49 | $ | 47 | ||||
Interest coverage | 5.1 | 4.1 | ||||||
Pro formainterest incurred (2) | $ | 57 | $ | 55 | ||||
Pro formainterest coverage (2) | 4.4 | 3.5 | ||||||
(1) | Reflects actual interest incurred on debt outstanding during the period. | |
(2) | Pro formainterest figures reflect actual interest incurred for the periods presented, adjusted to give effect to the $167 million drawdown of the Veladero project financing facility (which occurred in the third quarter of 2004) as if such drawdown had occurred on January 1, 2003 and October 1, 2003, respectively. |
Sincerely,
BARRICK GOLD CORPORATION
/s/ Richard Ball
Richard D. Ball
Vice President, Financial Reporting and
Risk Analysis
Vice President, Financial Reporting and
Risk Analysis