Newmont Mining Reports Progress on Key Projects, Expects Up to $1.3 Billion Capex This Year
Newmont Mining Corporation (NYSE:NEM) (Denver, Colorado) is proceeding on schedule with several key projects, with the gold and copper producer expecting to spend at least $400 million this year on development capital projects. Industrial Info is tracking Newmont projects with a combined worth of $12.02 billion.
Total capital expenditures for this year are expected to run between $1.1 billion and $1.3 billion (compared with $1.4 billion in 2015). In addition to development capital, the company expects to spend between $650 million and $700 million on sustaining capital, compared with .
Chief Executive Officer Gary Goldberg said he expects sustaining capital to increase to between $800 million and $900 million in 2017 to cover equipment rebuilds, water treatment and tailings storage. Sustaining capital for 2018 through 2020 will range from $700 million to $800 million.
Company executives outlined the progress of several projects during Newmont's quarterly earnings conference call with investment analysts. The Merian (Suriname), Long Canyon (Nevada), Cripple Creek & Victor (Colorado) and Tanami (Australia) projects are progressing on schedule and are at or below budget, they said. The facilities will add up to 1 million ounces of gold production per year, Goldberg said.
The Merian project in Suriname is 90% complete, with commercial start anticipated in second half 2016, Goldberg said. "And we remain $100 million below initial budget estimates. On the ground, more than 100,000 contained ounces of gold have been stockpiled and commissioning is proceeding on course. This keeps us on track to begin commercial production in the second half of this year, with first gold poured in the first quarter." The $1 billion project includes three open pit gold mines, a processing plant and related site infrastructure to produce 400,000 ounces of gold per year.
In the U.S., the $293 million Long Canyon project in Nevada is 80% complete and is on track to reach commercial production in early 2017, he said. The grassroot, above-ground mining operation includes open pit mining with a 3,000 to 8,000 ton-per-day heap leach process to produce 150,000 ounces per year of gold with silver credits.
Meanwhile, the $585 million Cripple Creek & Victor Heap Leach Mine expansion and mill addition, to be completed this year, will extend the life of the existing 300,000 ounce-per-year operation to 2025.
An expansion of the Tanami mine in Australia is expected to reach full production next year.
Newmont reported $50 million in net income for the just-ended second quarter, compared with $63 million for the same period in 2015.
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