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:: Newmont Pours First Gold at Long Canyon Ahead of Schedule and Below Budget
Newmont Mining Corporation poured first gold from Long Canyon ore on Tuesday, 8 November, and expects to declare commercial production next week. The operation is located 100 miles from Newmont’s existing Nevada complex and was completed two months ahead of schedule for just under $225 million – about $50 million or 18 percent below budget.
Long Canyon is the most significant oxide gold discovery in Nevada in more than a decade, with characteristics similar to the Carlin Trend where Newmont has been operating for more than 50 years. During the first phase, the Company will produce between 100,000 and 150,000 ounces of gold annually over an eight-year mine life at some of the lowest costs in its portfolio. Costs applicable to sales are expected to average between $400 and $500 per ounce and all-in sustaining costs are expected to average between $500 and $600 per ounce.i
“Our team built the first phase of Long Canyon safely, ahead of schedule and below budget. Taking a phased approach lowered initial development capital, helping to generate a 26 percent rate of return and reducing the payback period to just over four years,” said Gary Goldberg, President and Chief Executive Officer. “The project was further optimized by using refurbished equipment instead of new, building a leach facility instead of a mill, and leveraging our established infrastructure, expertise and stakeholder relationships in Nevada. We appreciate the strong support we have received from neighboring communities and government leaders including Nevada Governor Brian Sandoval, who dedicated the site on 28 September. We also acknowledge and thank local Goshute Tribe and Wells Band members for their collaboration in guiding a culturally sensitive approach to developing our newest mine.”
Newmont has grown the resource base at Long Canyon by 30 percent in two years; from an initial resource of 2.6 million ounces in 2013 to reserves and resources of 3.4 million ounces as of the end of 2015ii. Up to 11 drill rigs have been operating at Long Canyon this year. Newmont geologists have increased the mineralized strike by 70 percent to a length of more than five kilometers and oxide mineralization remains open in all directions.
Long Canyon is one of four profitable operations Newmont has added to its portfolio in the last three years, including Merian in Suriname in October 2016, Cripple Creek & Victor in Colorado in August 2015, and Akyem in Ghana in November 2013. The Company has also generated $2.8 billion in fairly valued asset sales in the same time frame. Taken together, these efforts have resulted in a lower cost, longer life asset portfolio, a stronger balance sheet, and among the highest free cash flow generation in the gold sector.
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