Dual-listed Barrick Gold and Newmont Goldcorp have successfully concluded the transaction to establish Nevada Gold Mines.
Barrick holds 61.5% of the new company and is also the operator, while Newmont Goldcorp owns 38.5% of Nevada Gold Mines.
Barrick said in a statement issued on Monday that the new joint venture (JV) will rank as the largest global gold producing complex by a wide margin, as it owns three of the world’s top ten tier one gold assets –Goldstrike/Carlin, Cortez and Turquoise Ridge/Twin Creeks – and potentially another one in the making, being Goldrush.
Its assets in north-eastern Nevada comprise ten underground and 12 openpit mines, two autoclave facilities, two roasting facilities, four oxide mills, a flotation plant and five heap leach facilities.
In 2018, these operations produced a combined 4.1-million ounces of gold, nearly double that of the industry’s next largest gold mine, being Muruntau, in Uzbekistan.
The company has a strong reserve and resource base with proven and probable reserves of 48.3-million ounces; measured and indicated resources of 27.4-million ounces; and a further 7.5-million ounces of inferred resources with still more potential, Barrick pointed out.
Nevada Gold Mines is targeting production of between 1.8-million and 1.9-million ounces a year at a preliminary estimated cost of sales of $940/oz to $970/oz and all-in sustaining costs of $920/oz to $950/oz for the second half of this year.
Barrick president and CEO Mark Bristow, who is also chairperson of Nevada Gold Mines, said the new company had been designed to combine “arguably the industry’s best assets and people to deliver the best value to stakeholders”.
“Its creation was driven by a compelling logic which had long been evident to all but had been elusive for two decades until we finally achieved a breakthrough this year,” Bristow said.
“Over the past months, we have selected and set Nevada Gold Mines’ leadership in place. The company now has one team that shares one vision, and who are more than ready to race out of the starting blocks. We have also identified the very significant synergy opportunities which are immediately available and those which have been targeted for the future.”
Identified synergies are expected to deliver up to $500-million a year over the first five years from 2020.
These will come mainly from integrated mine planning, optimised mining and processing, cost reductions and the combination of the adjacent Turquoise Ridge and Twin Creeks, which will be operated as a single mine.
Beyond 2020, the JV company is likely to benefit from longer profitable mine lives, longer-term employment opportunities, longer-term benefit-sharing with local communities and longer-term advantages for Nevada’s economy.
Bristow noted that the Nevada Gold Mines management team included executives from both JV partners.
The Executive MD is Greg Walker, formerly head of operations and technical excellence for Barrick’s North American region.
Barrick has three board seats and Newmont Goldcorp two, with the board supported by technical, finance and exploration advisory committees on which both companies have equal representation.