(Adds production, cost forecasts, byline)
By Susan Taylor
TORONTO, Feb 15 (Reuters) - Barrick Gold Corp ABX.TO reported better-than-expected profits and ambitious debt reduction plans on Wednesday, saying its balance sheet is now healthy enough to boost dividends and exploration spending.
The Toronto-based miner, which is hiking its dividend to 3 cents from 2 cents a share, said it will expand its hunt for new gold beyond trusted core districts and projects, to so-called 'greenfield' areas.
Such uncharted territory represents a higher risk of failure, but bigger potential rewards for sizeable discoveries. Some 80 percent of the $185-$225 million exploration budget is earmarked for the Americas, with much of the remainder for its African unit, Acacia.
In 2016, it budgeted $125-$155 million for exploration.
Barrick, the world's biggest gold miner, reported an adjusted profit of 22 cents a share, ahead of the consensus analyst estimate of 19 cents per share, and up from 8 cents a share in the same period last year.
Revenue increased to $2.32 billion from $2.24 billion.
Barrick, which has been selling non-core assets to help cut debt, plans to further reduce its debt by $2.9 billion by the end of 2018, decreasing its debt load to $5 billion from $7.9 billion currently.
Cash flow from operations, non-core asset sales and new joint ventures and partnerships will finance the effort, which reduced debt by $2 billion in 2016.
Barrick estimates its 2017 all-in sustaining costs, a measure of the effective day-to-day cost of producing gold, at $720-$770 an ounce, below an earlier estimate of $740-$775.
The cost of fourth-quarter production was $732 an ounce, down from $848 in the same period last year. Barrick has been pushing to improve efficiency and incorporate more technology into its operations.
Barrick expects to produce 5.6-5.9 million ounces of gold in 2017, up from 5.52 million in 2016, and above its earlier target of 5-5.5 million ounces.
Production in 2018 is expected to drop to 4.8-5.3 million ounces, and to 4.6-5.1 million ounces in 2019.
Fourth-quarter gold production declined to 1.52 million ounces from 1.62 million last year. Full-year copper output was 415 million pounds, with fourth-quarter production of 101 million pounds.
Proven and probable gold reserve estimates fell 6.5 percent, to 85.9 million ounces at the end of 2016, from 91.9 million ounces in 2015. Last year, some 1.9 million ounces was divested and 6.8 million ounces depleted through mining, Barrick said.