Newmont Reports 2019 Gold Mineral Reserves of 100 Million Ounces, Largest in Company History
DENVER— Newmont Corporation (NYSE: NEM, TSX: NGT) (Newmont or the Company) reported gold Mineral Reserves (reserves) of 100.2 million attributable ounces for 2019 compared to 65.4 million ounces at the end of 2018, an increase of 53 percent after successfully completing two historic transactions and through ongoing exploration success.
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Percentage of Gold Reserves by Jurisdiction (North America includes Nevada)
“Newmont has the largest gold reserve base in the industry underpinned by our world-class ore bodies in top tier jurisdictions. In 2019, we added almost 50 million ounces of gold reserves through the acquisition of Goldcorp, formation of the Nevada Gold Mines joint venture and the continuation of our leading exploration program,” said Tom Palmer, President and Chief Executive Officer. “Our reserve and resource base will support stable production of more than 6 million ounces per annum for decades to come.”
Key highlights and differentiators:
- Industry’s largest gold Mineral Reserves of 100.2 million ounces
- Gold reserves located in top-tier jurisdictions with 88 percent in Americas and Australia
- Gold reserve life at operating sites of >10 years underpinned by a strong base at Boddington, Tanami, Ahafo, Peñasquito, and Nevada Gold Mines, and further enhanced from our eight other operating mines and equity ownership in Pueblo Viejo
- Significant gold reserves per share with 124 ounces per 1,000 shares
- Tanami added 1.5 million ounces of gold reserves, 1.1 million ounces of Measured and Indicated gold resources and 1.6 million ounces of inferred resource
- Stable production profile underpinned by long life operating assets such as Boddington with 14 years; Tanami and Peñasquito with 12 years and Ahafo with 11 years
- Significant exposure to copper, silver, zinc, and lead with 63 million gold equivalent ounces (GEO)1
- Measured & Indicated gold Mineral Resources of 76.7 million ounces; Inferred of 31.3 million ounces
Reported figures include Red Lake and the Company’s 50 percent interest in Kalgoorlie Consolidated Gold Mines (KCGM). Newmont successfully completed the sale of KCGM in January 2020 and expects to close the divestment of Red Lake in the first quarter of 2020. Combined, these sites represented approximately 4.5 million ounces of gold reserves and 2.6 million ounces of Measured and Indicated gold Mineral Resources (resources), bringing Newmont’s adjusted 2019 gold Mineral Reserves to 95.7 and Measured and Indicated gold Mineral Resources2 to 74.1 million ounces.
Newmont’s reserve base is a key differentiator with 88 percent of gold reserves located in top-tier jurisdictions in the Americas and Australia, an operating reserve life of more than 10 years and average reserve grade of 1.05 grams per tonne. In addition, Newmont significantly increased its exposure to other metals, with an estimated 63 million gold equivalent ounces1 from copper, silver, zinc, lead and molybdenum.
In 2019, Newmont reported 100.2 million ounces of gold Mineral Reserves and 95.7 million ounces after adjusting for the KCGM and Red Lake divestments.
The Company added 42.2 million net ounces of gold reserves through its acquisition of Goldcorp and formation of the Nevada Gold Mines (NGM) joint venture, after adjusting for revisions at select Goldcorp operating sites, which were assessed using Newmont’s rigorous technical standards.
As previously disclosed, the Coffee project and Dome pit as part of the Century project were reclassified from Mineral Reserves to Mineral Resources, due to Feasibility study requirements. The project revisions were 1.7 million ounces and 4.4 million ounces, respectively.
Additions before revisions of 7.4 million ounces through exploration exceeded the Company’s target demonstrating drilling success and the prospectivity across the portfolio. Notable reserve additions for the year included: 2.5 million equity ounces from NGM, 1.5 million ounces at Tanami, 0.7 million equity ounces at NuevaUnión, 0.5 million ounces at Merian and 0.4 million ounces at Ahafo underground. Additions nearly offset depletion of 7.7 million contained ounces, which corresponds to Newmont’s 2019 attributable production outlook of 6.3 million ounces.
Newmont’s gold reserve grade was 1.05 grams per tonne compared to 1.19 grams per tonne in the prior year, largely due to the addition of polymetallic mines and projects including Peñasquito, NuevaUnión and Norte Abierto, which was partially offset by higher-grade reserves from the Company’s 38.5 percent equity ownership in NGM.
Newmont reported attributable Measured and Indicated gold Mineral Resources of 76.7 million ounces and 31.3 million ounces of attributable Inferred gold Mineral Resources, an increase of 95 percent and 101 percent from the prior year, respectively, at a constant gold price. Adjusted for the divestitures of KCGM and Red Lake.
Measured and Indicated gold Mineral Resources are 74.1 million ounces and Inferred gold Mineral Resources are 29.4 million ounces.
The acquisition of Goldcorp and formation of the NGM joint venture added 26.5 million net ounces of Measured and Indicated gold Mineral Resources and 13.7 million net ounces of Inferred gold Mineral Resources.
Measured and Indicated gold Mineral Resources added through exploration and studies were 7.8 million ounces and included notable additions before revisions of 1.1 million ounces at Tanami, 0.9 million equity ounces at both NGM and Pueblo Viejo, 0.8 million ounces at each of Ahafo underground, NuevaUnión and Merian (equity ounces).
Additions before revisions of 5.2 million ounces of Inferred gold Mineral Resources notably included 1.6 million ounces at Tanami, 0.8 million equity ounces at NGM, and 0.7 million ounces at Peñasquito.
Newmont’s Measured and Indicated gold Mineral Resource grade increased to 0.72 grams per tonne compared to 0.69 grams per tonne in the prior year from higher grade resources from NGM and the underground mines from the Goldcorp acquisition. Inferred gold Mineral Resource grade decreased to 0.66 grams per tonne from 1.01 grams per tonne, largely due to lower grade ounces from acquired polymetallic mines and projects.
Newmont’s base metal reserves increased significantly with the addition of the Goldcorp assets. Copper reserves increased to 6.8 million tonnes from 1.3 million tonnes in 2018, primarily due to the additions at the NuevaUnión and Norte Abierto projects. Copper resources increased significantly, increasing to 6.8 million tonnes of Measured & Indicated and 3.5 million tonnes of Inferred from 4.1 million tonnes of Measured & Indicated and 0.5 million tonnes of Inferred.
Silver reserves also increased significantly to 652 million ounces from 86 million ounces, primarily due to additions at Peñasquito, but also supported by NuevaUnión, Norte Abierto, Cerro Negro and Pueblo Viejo. Silver resources increased to 481 million ounces of Measured & Indicated and 217 million ounces of Inferred from 128 million ounces of Measured & Indicated and 21 million ounces of Inferred.
The Company also had first time declarations totaling 3.4 million tonnes of zinc reserves and 1.5 million tonnes of lead reserves at Peñasquito, and 0.1 million tonnes of molybdenum at NuevaUnión. First time declarations of zinc and lead resources were 1.9 million tonnes of Measured & Indicated and 1.0 million tonnes of Inferred, and 0.8 million tonnes of Measured & Indicated and 0.5 million tonnes of Inferred, respectively.
Newmont’s total attributable exploration expenditure3 is expected to be approximately $230 million in 2020, a decrease of 13 percent from the prior year as the Company captures $25 million of exploration synergies from the Goldcorp acquisition and approximately $10 million from the divestiture of KCGM and Red Lake. Around 80 percent of total exploration investment will be dedicated to near-mine expansion programs and the remaining 20 percent will be allocated to the advancement of greenfield projects and innovation programs. Geographically, the Company expects to invest approximately 30 percent in North America, 25 percent in South America, 20 percent in Australia and the remainder in Africa and other locations.
Gold Reserve Sensitivity
A $100 increase in gold price would result in an approximate six percent increase in gold reserves while a $100 decrease in gold price would result in an approximate six percent decrease in gold reserves. These sensitivities assume an oil price of $60 per barrel (WTI), Australian dollar exchange rate of $0.75 and Canadian dollar exchange rate of $0.77.
For additional details on Newmont’s reported Gold, Copper, Silver, Zinc, Lead and Molybdenum Mineral Reserves and Mineral Resources, please refer to the tables at the end of this release.
1 Gold Equivalent Ounces calculated using Mineral Reserve pricing as shown at the end of this release and metallurgical recoveries for each metal on a site-by-site basis.
2 Totals may not sum due to rounding.
3 Includes capitalized and expensed exploration.
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