Newmont is expanding operations at the Tanami gold mine in Australia to add incremental gold production of approximately 80,000 ounces per year, while decreasing Tanami’s all-in sustaining costs by 5 to 10 percent in the first five years of production.
“Tanami is a Newmont success story. Since 2012, the team has more than doubled gold production while cutting costs by about two-thirds and significantly improving resource confidence. The expansion project continues this trajectory, offering robust returns of more than 35 percent at current gold prices,” says Gary Goldberg, President and Chief Executive Officer.
The expansion project includes building a second decline in the underground mine, along with expanding capacity in the processing plant, allowing access to 2 million additional ounces of profitable production and extending the life of the mine by three years. The project will also create a platform for exploration drilling to support future growth. In fact, recent exploration results demonstrate the potential to double current reserves and resources by expanding Tanami’s existing deposits and developing adjacent discoveries.
When the expansion is complete, Tanami will produce between 425,000 and 475,000 ounces of gold per year at all-in sustaining costs of between $700 and $750 per ounce in the first five years of production. The capital investment of between $100 million and $120 million will be funded through free cash flow and available cash balances.
Newmont has one of the strongest project pipelines in the gold sector, and remains on track to deliver profitable new production from Leeville in Nevada as the Turf Vent Shaft is completed in late 2015; from Cripple Creek & Victor’s expansion projects during 2016; from Merian in Suriname in late 2016; and from Long Canyon Phase 1 in Nevada beginning in 2017.
Tanami is located 590 miles southwest of Darwin and 350 miles northwest of Alice Springs in Australia’s Northern Territory. The expansion project falls within the existing Tanami operating footprint on the Granites and Dead Bullock Soak mineral leases. Newmont acquired its interest in 2002 through its merger with Normandy. In 2014, Tanami produced approximately 345,000 ounces of gold at all-in sustaining costs of $1,038 per ounce.
For more information about Newmont’s operations and results, please visit our website.
Cautionary Statement: The above contains “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended, which are intended to be covered by the safe harbor created by such sections and other applicable laws. Forward-looking statements may include, without limitation: (i) estimates of future production; (ii) estimates of future costs applicable to sales and all-in sustaining costs; (iii) estimates of future capital expenditures and investments; (iv) expectations regarding future sources of funding, free cash flow and available cash balances; (v) expectations regarding development, growth and exploration potential, future mineralization and future discoveries at Tanami; and (vi) expectations regarding future development and growth of the Company’s project pipeline, including at Turf Vent Shaft, Cripple Creek & Victor, Suriname and Long Canyon Phase 1. Estimates or expectations of future events or results are based upon certain assumptions, which may prove to be incorrect. Such assumptions include, but are not limited to: (i) there being no significant change to current geotechnical, metallurgical, hydrological and other physical conditions; (ii) permitting, development, operations and expansion of the Company’s projects being consistent with current expectations and mine plans, including, without limitation, receipt of export approvals; (iii) political developments in any jurisdiction in which the Company operates being consistent with its current expectations; (iv) certain exchange-rate assumptions for the Australian dollar to the U.S. dollar, as well as other exchange rates being approximately consistent with current levels; (v) certain price assumptions for gold, copper and oil; (vi) prices for key supplies being approximately consistent with current levels; and (vii) the accuracy of mineral reserve and resource estimates. Those assumptions remain subject to risks and uncertainties, which could cause actual results to differ materially from anticipated future results. For a discussion of risks, see the risk factors section included in the Form 10-Q, filed on July 23, 2015, with the Securities and Exchange Commission (SEC), as well as the Company’s other SEC filings. The Company does not undertake any obligation to release publicly revisions to any “forward-looking statement” to reflect events or circumstances after the date hereof, except as may be required under applicable securities laws. Investors should not assume that any lack of update to a previously issued “forward-looking statement” constitutes a reaffirmation of that statement. Continued reliance on “forward-looking statements” is at investors’ own risk.