Tag Archives: Gary Goldberg

World Gold Council formalises ESG standards for miners

The World Gold Council (WGC), the market development organisation for the gold industry, has announced the launch of its Responsible Gold Mining Principles.

The principles are a framework that set out expectations for consumers, investors and the downstream gold supply chain as to what constitutes responsible gold mining, the WGC said.

Working with the world’s leading gold mining companies – the WGC’s members – the council has set out the principles it believes address key environmental, social and governance (ESG) issues for the gold mining sector.

The principles focus on 10 key areas. Under the governance section, this includes ethical conduct, “understanding our impacts” and the supply chain. Social concerns include safety and health, human rights and conflict, labour rights and working with communities. The remaining three in the environmental bracket are environmental stewardship, biodiversity, and water, energy and climate change.

It is the World Gold Council’s aim that the Responsible Gold Mining Principles become a credible and widely recognised framework through which gold mining companies can provide confidence that their gold has been produced responsibly, the WGC said, acknowledging that ESG considerations are becoming increasingly important to consumers.

Companies implementing the Responsible Gold Mining Principles will be required to obtain external assurance from a third party, independent assurance provider. This will provide further confidence to purchasers of gold that the gold they buy is responsibly mined and sourced, it said.

Gary Goldberg, CEO of Newmont Goldcorp, who oversaw this initiative on behalf of the Board of the World Gold Council, said: “Adherence to strong ESG principles should be a key part of any responsible gold mining business and, as such, the members of the World Gold Council have collaborated, along with key industry stakeholders, to develop the Responsible Gold Mining Principles.

“Given the Members’ sustained focus on improving ESG performance, the formalisation of the Responsible Gold Mining Principles is a natural evolution of our daily working practices. It is my hope that these principles will be widely adopted, not only by member companies, but by the industry more broadly.”

Terry Heymann, Chief Financial Officer of the WGC, said it was the council’s aim that the principles reinforce trust in gold and the gold mining industry.

“Consumers, investors and the downstream gold supply chain will be able to know, with confidence, that their gold has been responsibly sourced,” he said. “The principles incorporate feedback from more than 200 organisations and individuals over two rounds of consultation and are designed to support the efficient operation of the gold market.”

Barrick and Newmont Goldcorp launch Nevada Gold Mines

Barrick Gold and Newmont Goldcorp have officially launched their Nevada Gold Mines LLC joint venture, just over three months since the two signed an implemtentation agreement.

The new JV, owned 61.5% and operated by Barrick, and owned 38.5% by Newmont Goldcorp, will rank as the largest global gold producing complex by a “wide margin”, according to Barrick, with three of the world’s top 10 Tier One gold assets (Goldstrike/Carlin, Cortez and Turquoise Ridge/Twin Creeks) and potentially another one in the making (Goldrush), the company said.

Nevada Gold Mines’ assets in north-eastern Nevada comprise 10 underground and 12 open-pit mines, two autoclave facilities, two roasting facilities, four oxide mills, a flotation plant and five heap leach facilities. In 2018, these operations produced a total of 4.1 Moz of gold, approximately double that of the industry’s next largest gold mine (Muruntau, in Uzbekistan).

The company has a reserve and resource base with proven and probable reserves of 48.3 Moz; measured and indicated resources of 27.4 Moz; and a further 7.5 Moz of inferred resources with still more potential, Barrick said.

Nevada Gold Mines is targeting production of between 1.8-1.9 Moz at a preliminary estimated cost of sales of $940-970/oz and all-in sustaining cost of $920-950/oz for the second half of 2019.

Barrick President and Chief Executive Officer, Mark Bristow, who is chairman of the new company, says the establishment of Nevada Gold Mines was designed to combine, arguably, the industry’s best assets and people in order 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.”

Gary Goldberg, Newmont Goldcorp’s Chief Executive Officer, said: “This innovative joint venture represents a unique opportunity to generate additional long-term value for our shareholders, employees, and the communities of northern Nevada. By combining our assets and talent in Nevada, the joint venture will extend safe, profitable and responsible production much further than what each company could have done on its own. We look forward to actively participating in and supporting the JV to deliver a positive step-change in results.”

Identified synergies are expected to deliver up to $500 million/y over the first five years from 2020, stepping down over time after that. 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.

Barrick said: “Second half guidance builds in those synergies that the company believes it should be able to realise within the next six months, representing approximately half of the targeted annual cash flow improvements. With the closing of the JV now complete, the company will look to incorporate further synergies to benefit 2020 and beyond.”

The future benefits include longer profitable mine lives, longer-term employment opportunities, longer-term benefit-sharing with local communities and longer-term advantages for Nevada’s economy, according to Barrick.

Bristow noted that the Nevada Gold Mines management team included executives from both joint venture partners. The Executive Managing Director 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.

Newmont powers up at Tanami gold mine in Australia

Newmont Mining says it has completed the Tanami power project, in the Northern Territory of Australia, safely and on schedule.

The project included the installation of two power stations, a 66 kV interconnected power line, and a 450 km natural gas pipeline. The pipeline was built and will be maintained by Australian Gas Infrastructure Group, while the power stations were constructed and will be operated by Zenith Energy. Capital costs are estimated at approximately $245 million with annual cash lease payments over a 10-year term beginning in 2019.

The successfully completed project is expected to provide the Tanami gold mine a safe and reliable energy source while lowering power costs and carbon emission by 20%, Newmont said. The project is expected to generate net cash savings of $34/oz from 2019 to 2023, delivering an internal rate of return of greater than 50%.

Newmont Chief Executive Officer, Gary Goldberg, said: “In addition to lowering costs and carbon emissions, the completed Tanami power project will pave the way to further extend the life of the operation.

“Consistent execution and delivery remain the hallmark of our ability to generate free cash flow and create long-term value for our shareholders and other stakeholders. Completion of the project coincides with Tanami pouring its 10 millionth ounce of gold on the back of record production of 500,000 oz last year. This achievement is a testament to the skill of our team as well as our valued partnership with the Walpiri people, the Traditional Owners of the land.”

Tanami is Australia’s second largest underground gold mine and one of the most cost competitive gold producers in the world, according to Newmont. Newmont’s continued exploration work at Tanami has created the potential to extend mine life beyond 2028, with additional upside through a possible second expansion project the company expects to make a full funding decision on in the second half of 2019. Last year, more than 800,000 oz of gold resources were converted into reserves from Tanami’s Auron orebody.

Barrick and Newmont agree on Nevada gold joint venture

Barrick Gold and Newmont Mining have signed an implementation agreement that should see the two companies’ Nevada mining operations, assets, reserves, and talent combine under a joint venture.

The joint venture will, according to the two companies, allow them to capture an estimated $500 million in average annual pre-tax synergies in the first five full years of the combination, which is projected to total $5 billion pre-tax net present value over a 20-year period.

“The joint venture is an historic accord between the two gold mining companies, which have operated independently in Nevada for decades, but have previously been unable to agree terms for cooperation,” they said.

Barrick Gold had previously made an offer to take over Newmont, which itself is in the middle of trying to complete the acquisition of fellow gold miner Goldcorp. The company has agreed to withdraw this offer, in addition to proposals for the Newmont annual general meeting that it submitted on February 22. These included, according to Newmont, an amendment to Newmont’s by-laws to lower the share ownership threshold necessary to requisition shareholder meetings to 15% from the current 25% and to repeal all by-law amendments implemented since October 24, 2018.

Barrick President and Chief Executive Officer, Mark Bristow, said the Nevada agreement marked the successful culmination of a deal that had been more than 20 years in the making. “We listened to our shareholders and agreed with them that this was the best way to realise the enormous potential of the Nevada goldfields’ unequalled mineral endowment, and to maximise the returns from our operations there.

“We are finally taking down the fences to operate Nevada as a single entity in order to deliver full value to both sets of shareholders, as well as to all our stakeholders in the state, by securing the long-term future of gold mining in Nevada.”

Gary Goldberg, Chief Executive Officer of Newmont, said the logic of combining the two companies’ operations was compelling. “This agreement represents an innovative and effective way to generate long-term value from our joint assets in Nevada, and represents an important step forward in expanding value creation for our shareholders. Through the joint venture, we will also continue to pursue the highest standards in safety, along with responsible and meaningful engagement with our employees, communities, and other stakeholders,” he said.

Following the completion of the joint venture, the Nevada complex will be the world’s single-largest gold producer, with a pro-forma output of more than 4 Moz in 2018, three Tier One assets, potentially another one in the making, and 48 Moz of reserves.

The establishment of the joint venture is subject to the usual conditions, including regulatory approvals, and is expected to be completed in the coming months.

The joint venture will exclude Barrick’s Fourmile project and Newmont’s Fiberline and Mike deposits, pending the determination of their commercial feasibility.

More major gold M&A as Newmont agrees to buy Goldcorp for $10 billion

Newmont Mining has agreed to acquire Goldcorp in a friendly all-stock deal valuing the Canada-headquartered company at $10 billion.

Under the terms of the agreement, Newmont will acquire each Goldcorp share for 0.3280 of a Newmont share, which represents a 17% premium based on the companies’ 20-day volume weighted average share prices.

The deal comes just weeks after Barrick Gold merged with Randgold Resources to create a new industry giant.

“The agreement will combine two gold industry leaders into Newmont Goldcorp, to create an unmatched portfolio of operations, projects, exploration opportunities, reserves and people in the gold mining sector,” Newmont said.

“Newmont Goldcorp’s world-class portfolio will feature operating assets in favourable jurisdictions, an unparalleled project pipeline, and exploration potential in the most prospective gold districts around the globe. In addition to providing shareholders the largest gold Reserves per share, Newmont Goldcorp will offer the highest annual dividend among senior gold producers.”

Gary Goldberg, Newmont’s Chief Executive Officer, said: “We have a proven strategy and disciplined implementation plan to realise the full value of the combination, including an exceptional pool of talented mining professionals, stable and profitable gold production of 6-7 Moz over a decades-long time horizon, the sector’s largest gold reserve and resource base, and a leading project and exploration pipeline.

“Our cultures are well aligned, with strong commitments to zero harm, inclusion and diversity, and industry-leading environmental, social and governance performance. We expect to generate up to $100 million in annual pre-tax synergies, with additional cost and efficiency opportunities that will be pursued through our proven full potential continuous improvement programme.”

Newmont Goldcorp’s reserves and resources will represent the largest in the gold sector, located in favourable mining jurisdictions in the Americas, Australia and Ghana, representing approximately 75%, 15% and 10%, respectively.

Newmont Goldcorp will also prioritise project development by returns and risk, while targeting $1.0 to 1.5 billion in divestitures over the next two years to optimise gold production at a sustainable, steady-state level of 6-7 Moz annually.

Goldcorp’s President and Chief Executive Officer, David Garofalo, said: “Newmont Goldcorp will be one of Canada’s largest gold producers and will have its North America regional office in Vancouver, and expects to oversee more than three million ounces of the combined company’s total annual gold production.”

Following the merger, Newmont Goldcorp’s management team will be appointed on a “best talent” basis, Newmont said, with Gary Goldberg as Chief Executive Officer and Tom Palmer as President and Chief Operating Officer.

As part of a planned and orderly leadership succession process, Goldberg and Newmont’s board have been engaged in discussions anticipating a CEO succession in early 2019. In October 2018, the company also announced Palmer’s promotion to President and Chief Operating Officer.

To ensure a smooth and successful combination, Goldberg has agreed to lead Newmont Goldcorp through closure of the transaction and integration of the two companies. The company expects this process to be substantially completed in the December quarter of 2019, when Goldberg plans to retire and Palmer will become President and Chief Executive Officer.

The Board of Directors will be proportionally comprised of Newmont and Goldcorp Directors, with Noreen Doyle as Chair and Ian Telfer as Deputy Chair.

Goldcorp’s Vancouver, Canada, office will become Newmont Goldcorp’s North America regional office, while Newmont Goldcorp’s South America regional office will be in Miami, US, the Australia regional office will be in Perth, and the Africa regional office will be in Accra, Ghana. Newmont Goldcorp will be a Delaware corporation with its corporate headquarters in Colorado, US.

The Boards of Directors of both companies have unanimously approved the transaction, including in the case of Goldcorp, on the unanimous recommendation of a special committee of independent directors of Goldcorp.

The transaction is expected to close in the June quarter, but closing is subject to approval by the shareholders of both companies; regulatory approvals in a number of jurisdictions including the European Union, Canada, South Korea and Mexico; and other customary closing conditions.

Newmont Mining named sustainability leader for fourth consecutive year

Newmont Mining Corporation has been named the Metals and Mining sector leader by the Dow Jones Sustainability World Index (DJSI) for a fourth year in a row.

Newmont was the first gold company named to the index in 2007, and has been included on the DJSI North America Index every year since 2006.

“This recognition is an important reflection of how well we are doing to create value and improve lives for all of our stakeholders,” Gary Goldberg, President and Chief Executive Officer, said. “Employees at our sites around the globe know that leading in profitability and responsibility go hand-in-hand, and that their day-to-day work can have positive and lasting impacts on local communities.

“Our focus is on the long-term success of our company and doing that requires integrating sustainability into all aspects of our business.”

In addition to being recognised as the Metals and Mining sector’s sustainability leader, Newmont achieved outstanding performance in a number of areas of the index including 100th percentile in the following:

  • Economic: corporate governance, risk and crisis management, and policy influence;
  • Environmental: biodiversity, climate strategy, and water-related risks;
  • Social: labour practice indicators, human rights, corporate citizenship and philanthropy, and asset closure management.

As part of the index calculations, RobecoSAM evaluated 600 data points for nearly 2,100 companies to determine inclusion and ranking on the DJSI.

Areas evaluated included corporate governance; risk and crisis management; supply chain management; climate strategy; human rights; talent attraction and retention; safety; environmental management and performance; codes of business conduct; local community development; and labour practices.