Tag Archives: Newmont Mining

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.

Diesel power up and running at Tanami gold project, Zenith Energy says

Zenith Energy says it has achieved completion on the diesel portion of its 62 MW power station for Newmont Mining’s Tanami gold mine in the Northern Territory of Australia.

The remote power generation specialist said it had energised the 42 km 66 kV interconnect between the Dead Bullock Soak and Granites sites, enabling transmission of power for the site in line with previous estimates.

The agreement between Zenith and Newmont – a build, own and operate (BOO) contract for a 62 MW power station at the mine – is the largest such power purchase agreement Zenith has signed to date. It is for an initial 10-year term, with an option to extend the contract for a further 10 years.

“Zenith is also delighted to confirm that the supply commencement milestone of Q1 2019 has been successfully achieved, with numerous complex design, engineering, logistics and construction challenges met and overcome, resulting in the on‐time, on‐budget and safe completion of this landmark project by Zenith’s world‐class team,” Zenith said.

The power station comprises 52 MW of gas‐fired and circa 10 MW of diesel (back‐up) power generation. Zenith said: “To put the scale of the power station in perspective, the average Australian household consumes circa 25 kWh/d of power, whereas the Tanami facility will produce upwards of 864,000 kWh/d.”

With the completion of this facility, Zenith has 428 MW of total generation capacity under control.

The design and construction phase for Tanami required the transport of three 150‐t Wartsila 34DF generators by road train from Fremantle in Western Australia; a 3,000 km journey (pictured) taking more than one week to complete, according to Zenith.

Managing Director of Zenith Energy, Hamish Moffat, said: “The construction of our 62 MW power station at Tanami, on time and within budget, is testament to the capability and commitment of the entire Zenith Energy team. As the largest BOO hybrid gas‐diesel project we have undertaken, completion of the Tanami power station is a major milestone for Zenith.

“Diesel-fuelled electricity supply from the facility has commenced and gas supply is imminent. We look forward to delivering cost‐effective, reliable power to Newmont’s Tanami operation for years to come.”

Newmont’s Tanami underground gold mine produced 419,000 oz of gold (attributable to Newmont) in 2017.

Gas starts flowing from AGIG’s 440 km Tanami pipeline

Australian Gas Infrastructure Group (AGIG) says it has commissioned Australia’s newest major natural gas pipeline project ahead of schedule.

The 440 km Tanami Natural Gas Pipeline was recently given the final signoff to start operating by the Northern Territory Government. It will fuel the power stations at Newmont Mining’s Tanami gold mine in the Northern Territory.

AGIG’s Chief Customer Officer, Andrew Staniford, said: “We have now commissioned the pipeline and gas is already flowing into Newmont’s Tanami mine site.”

Staniford said the final go-ahead for the pipeline to move into full operational mode followed the introduction of gas and extensive commissioning and testing of the pipe and the facilities at the pressure under which the pipeline will operate. Operations were initially expected to start up in the March quarter.

“These tests were successfully undertaken by AGIG and independently verified, thereby enabling the final approval to be given,” he said.

AGIG was, last year, awarded the contract by Newmont to build, own and operate the new 440 km pipeline, which transports gas to the Newmont mine site, about 540 km northwest of Alice Springs, in the Northern Territory.

Staniford said: “To deliver the project safely and ahead of schedule for Newmont and its operating gold mine is a feather in the caps of all involved and has further cemented AGIG’s proud position as a leading provider and operator of key energy infrastructure throughout Australia.”

The new NT pipeline follows the alignment of Tanami Road and passes through a mix of pastoral land, Aboriginal freehold land and Crown land.

Newmont’s Tanami underground gold mine produced 419,000 oz of gold (attributable to Newmont) in 2017.

Swick Mining boosts profits as it looks to drill deeper at Kirkland Lake Gold’s Fosterville mine

Swick Mining’s strategies of shifting drill rigs on to better performing contracts or new projects and reducing costs has continued to pay off with the underground and surface mineral drilling business posting a more than 100% year-on-year increase in EBITDA in the December quarter.

The company delivered “strong unaudited results” for the three-month period, it said, with the drilling business’ earnings before interest, tax, depreciation and amortisation (EBITDA) up 109% to A$9.5 million ($6.8 million). This coincided with the company completing 263,690 m of drilling and the average fleet use coming in at 75% across the quarter.

Drilling business revenue of A$37.7 million was up 8% compared with the same quarter of 2017. Overall group revenue and EBITDA was marginally up on the drilling business numbers as the company’s mineral technology business, Orexplore, registered several commercial scans during the period.

In addition to shifting drill rigs and cutting costs, Swick benefitted from improved short-term rates at two existing underground drilling services contracts in the quarter – for Newmont and its Tanami and Mt Charlotte assets, where 11 rigs are deployed. Swick said: “These rates will run through to March 2019, to allow for a competitive tender process for the long-term contracts to be completed (in which Swick is participating).”

Swick Managing Director, Kent Swick (pictured), said: “The earnings rebound of our drilling business has continued and shows how we can unlock Swick’s potential when we target the right projects for the right clients and ensure we deliver value for money for our clients.

“The improved margins are a mixture of adjusted rates where needed and also from a 6% year-on-year reduction in our operating costs per shift in the underground division by focusing on manning levels, consumables usage, procurement processes and inventory management.”

The Swick MD added that its recently established deep exploration division, DeepEx, continued to move forward during the quarter with preparations underway to deploy two high-torque mobile drills this month at Kirkland Lake Gold’s Fosterville mine. This will further assist the deep underground exploration drilling it is already carrying out at the mine.

This came on top of an update on Orexplore, which in the eight months since launch has secured seven customers and numerous trial programmes with a range of miners, explorers and consultants, Kent Swick said.

He also said the gold spectrometer was undergoing testing at Orexplore’s R&D headquarters in Stockholm, Sweden, and that the company expects to have initial feedback on the in-machine prototypes performance during this quarter.

Newmont speeding up mine plan decisions with digital and VR technologies

Newmont Mining, in a recent blog, has provided more details of how it is using digital technology and strategic mine planning to improve decision making at its operations.

One of the examples the leading gold miner gave was how it is using Maptek’s Vulcan Stope Optimiser at its Tanami gold operation in Australia.

This software delivers full 3D capabilities on stope shape generation and block model analysis without manual digitising, according to Maptek.

“Used at our Tanami operation, Vulcan delivers an improved approach for open-pit ore control polygon optimisation and helps reduce design time by roughly 98%,” Newmont said, citing a Maptek case study.

Virtual reality is another technology helping the company make smarter decisions, faster, it added.

“Paraview software – an open-source, multi-platform data analysis and visualisation application – delivers 2D data maps at a 3D scale, helping engineers and technicians envision geology models with greater precision,” Newmont said.

“With virtual reality, we are better equipped to identify potential problem areas and make smarter planning decisions.”

Newmont says it makes investments in these technologies only after asking – and answering – this question: “Does it add value or reduce risk to the business?”

“To help us answer this question, we partner with academic and industry experts to develop, source and test tools for driving mine optimisation. Only after rigorous trials result in proven value creation can teams then consider a wider rollout across sites,” it said.

One example of Newmont’s technology research and development work is its partnership with Montreal’s McGill University to launch the COSMO Laboratory – a global consortium dedicated to advancing the mine of the future.

Newmont reaches golden milestone at Merian in Suriname

Newmont Suriname has reached 1 Moz of gold poured at the Merian gold mine in east Suriname, two years after commercial production began on October 1, 2016.

Merian was built safely, on time and approximately 20% below budget, with total development capital of $525 million invested by Newmont. Staatsolie, on behalf of the Government of Suriname, owns 25% of the operation. It is 60 km south of Moengo and predominantly in the Pamakan area, about 15 km west of the Marowijne River.

In 2018, the second phase of the Merian project was also completed safely, on time and within budget with the construction of a primary crusher to process harder ores that will be recovered, as the mine gets deeper.

Based on current gold reserves, Newmont Suriname projects a mine life of approximately 15 years for Merian. The company is also conducting exploration activities at Sabajo and in north and south Amazonia, which could further expand and extend production in Suriname.

In August 2016, Newmont established the Pamaka Community Development Foundation (CDF) to implement development projects in the Pamaka area. In support of the foundation, Newmont Suriname voluntarily contributes $1/oz sold. The board of directors of the CDF consists of two representatives of the Pamaka community, two Newmont representatives and two from the government.

Merian is due to produce between 485,000 and 540,000 oz of gold this year at all-in sustaining costs of $580-630/oz.

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.

Newmont Mining still weighing up LNG/diesel dual-fuel options

The use of LNG in the engines of mining haul trucks has been gaining serious traction of late with OEMs and mining companies, alike, considering dual-fuel options.

Newmont Mining stated in its 2017 sustainability report, released back in April, that it and Caterpillar were looking at such a project as part of the US-based mining company’s attempt to decrease its greenhouse gas (GHG) emissions.

The company believes the advancement of dual-fuel engines on haul trucks could displace, on average, 65% of diesel fuel with LNG.

A Newmont spokesman told IM this week that the company is still in the process of evaluating an LNG option and, at some point, it may “take the next step towards a meaningful pilot project”.

Teck Resources carried out such a trial at its Fording River coal operations in British Columbia, Canada.

The pilot test, which used a hybrid LNG/diesel fuel system in six haul trucks and concluded in December 2016, provided many valuable learnings to Teck, including “utilising LNG safely and integrating new technologies at our operations”, Greg Brouwer, General Manager, Technology and Innovation, recently told IM.

“While the particular LNG technology used in this pilot did not achieve the targeted emission reduction benefits, we remain committed to exploring the use of LNG as a haul truck fuel source to reduce GHG emissions and costs and we are currently assessing other technologies,” he said. (You can read more about Teck’s latest innovations in the upcoming IM October issue)

Just last month, GFS Corp reported increased interest in its EVO-MT® System for off-highway machinery. Much of this renewed interest is coming from the mining sector where the company’s products allow haul trucks, wheel loaders and drill rigs to operate on a combination of diesel and LNG or NG+D® as the company refers to it, GFS said.

Newmont goes for CEP renewable solution at Akyem gold mine in Ghana

Cambridge Energy Partners (CEP) has announced that Newmont Mining will use its redeployable Nomad solar PV tracker at its Akyem gold mine in Ghana as the US-based company looks to reduce carbon emissions and its energy consumption and costs.

CEP’s Nomad is a prefabricated and redeployable solar generator with single-axis tracking technology. It can be used in a variety of applications and is designed for quick deployment in scalable 30 kW segments.

“Energy generated by CEP’s Nomad is fully integrated into existing electrical networks to create a reliable and sustainable hybrid power system,” CEP said.

Akyem is in the Birim North District of the Eastern Region of Ghana, some 178 km northwest of Accra. It produced 473,000 oz of gold in 2017.

In Newmont’s 2017 sustainability report, the company said it had advanced a 110 kW solar project at Akyem to the contracting phase. This plant would power the camp and mess hall during daylight hours.

CEP confirmed to IM that Newmont has increased this project to 120 kW and four Nomad units had since been installed and commissioned by local staff.

Power is currently supplied to the Akyem mine site by a 161 kV overhead line system that connects Nkawkaw and Kwae and passes through the area. According to CEP, up to 60% of this power is sourced from diesel and other fossil fuel generating plants.

CEP CEO Tom Miller said the company’s vision is to deliver lower-cost energy to all remote mining sites with its Nomad solar technology.

“In addition, the mobility of our solar technology significant mitigates the risks often associated with permanent solar installations,” he said.