https://www.miningweekly.com

Newmont issues new 2020 guidance, lowers capex

19th May 2020

By: Mariaan Webb

Creamer Media Senior Deputy Editor Online

     

Font size: - +

US-based gold major Newmont has issued a new production guidance for 2020, as it began ramping up operations at four sites that were previously placed in care and maintenance.

CEO Tom Palmer reported in a media statement on May 19 that 13 sites of Newmont's 14 operating mines and joint ventures would be fully operational in the "coming weeks".

The only operation that remains suspended is the Musselwhite mine, in northern Ontario, Canada. The company idled operations at Musselwhite on March 23 to prevent the possible transmission of the coronavirus to the nearby First Nation communities. Newmont said it would agree a safe restart plan with First Nations.

Assuming that operations continue throughout the remainder of the year without major interruptions, the miner expects 2020 attributable production of 6-million ounces, down from the previous guidance of 6.4-million ounces.

Its gold cost applicable to sales guidance increased by $25/oz to $775/oz and its gold all-in sustaining cost guidance increased by $40/oz to $1 015/oz.

“The revised 2020 outlook includes the production and cost impacts from our five operations temporarily placed into care and maintenance for an average of 45 days. The second quarter is expected to be the lowest production and highest cost quarter of 2020 as the sites ramp up from care and maintenance,” the company stated.

Meanwhile, Newmont continued to progress the majority of its development and sustaining capital projects, including Tanami Expansion 2, in Australia, developing the sub-level shrinkage mining method at Subika Underground, in Ghana, and advancing laybacks at Australia’s Boddington and Ghana’s Ahafo.

However, as a result of Covid-19, total 2020 capital expenditure (capex) is now expected to be about $1.3-billion, owing to reductions in non-essential activities and changes to the development capital schedule for Tanami Expansion 2 and Boddington’s Autonomous Haulage, which defers some expenditures to 2021.

The gold major lowered its attributable sustaining capex guidance from $950-million to $775-million, and reduced the development capex budget from $575-million to $450-million.

For exploration and advanced projects, about 80% of Newmont’s exploration budget was allocated to near-mine with the majority of work suspended in March. However, near-mine drilling programmes are being ramped up and greenfield activities in French Guiana, Suriname, Ethiopia, Peru, Chile and Australia would resume "as soon as local restrictions are lifted".

The exploration teams have been working remotely focused on improving orebody and district scale models, as well as developing risk mitigation plans to restart activities under Covid-19 restrictions. Advanced project study work for Yanacocha sulphides and Ahafo North continues remotely, Newmont said.

Edited by Creamer Media Reporter

Comments

The functionality you are trying to access is only available to subscribers.

If you are already a subscriber, you can Login Here.

If you are not a subscriber, you can subscribe now, by selecting one of the below options.

For more information or assistance, please contact us at subscriptions@creamermedia.co.za.

Option 1 (equivalent of R125 a month):

Receive a weekly copy of Creamer Media's Engineering News & Mining Weekly magazine
(print copy for those in South Africa and e-magazine for those outside of South Africa)
Receive daily email newsletters
Access to full search results
Access archive of magazine back copies
Access to Projects in Progress
Access to ONE Research Report of your choice in PDF format

Option 2 (equivalent of R375 a month):

All benefits from Option 1
PLUS
Access to Creamer Media's Research Channel Africa for ALL Research Reports, in PDF format, on various industrial and mining sectors including Electricity; Water; Energy Transition; Hydrogen; Roads, Rail and Ports; Coal; Gold; Platinum; Battery Metals; etc.

Already a subscriber?

Forgotten your password?

MAGAZINE & ONLINE

SUBSCRIBE

RESEARCH CHANNEL AFRICA

SUBSCRIBE

CORPORATE PACKAGES

CLICK FOR A QUOTATION