DENVER, CO - Newmont Mining Corporation has been mining gold in Nevada since 1965. Nevada operations include Carlin, located west of the city of Elko on the geologic feature known as the Carlin Trend, the Phoenix mine, located 10 miles south of Battle Mountain, the Twin Creeks mine, located approximately 15 miles north of Golconda, and the Midas mine near the town of the same name. Newmont also participates in the Turquoise Ridge joint venture with a subsidiary of Barrick Gold Corporation, which utilizes mill capacity at Twin Creeks.
Gary Goldberg, President and Chief Executive Officer reported that, ╥Gold production from Nevada was approximately 1.748 million ounces for 2012 with ore mined from nine open pit and seven underground mines. At December 31, 2012, we reported 35.1 million ounces of gold reserves in Nevada, with 77% of those ounces in open pit mines and 23% in underground mines. The company is advancing several development opportunities in Nevada, including Long Canyon.?
The Nevada operations produce gold from a variety of ore types requiring different processing techniques depending on economic and metallurgical characteristics. To ensure the best use of processing capacity, the company uses a linear programming model to guide the flow of both mining sequence selection and routing of ore streams to various plants. Refractory ores, which require more complex, higher cost processing methods, generated 82% of Nevada╒s gold production in 2012, compared with 79% in 2011 and 79% in 2010. With respect to remaining reserves, Newmont estimates that approximately 85% are refractory ores and 15% are oxide ores. Higher-grade oxide ores are processed by conventional milling and cyanide leaching at Carlin (Mill 5) and Twin Creeks (Juniper). Lower-grade material with suitable cyanide solubility is treated on heap leach pads at Carlin and Twin Creeks. Higher-grade refractory ores are processed through either a roaster at Carlin (Mill 6) or autoclaves at Twin Creeks (Sage). Lower-grade refractory ores are processed at Carlin by flotation or direct flotation at Mill 5. Mill 5 flotation concentrates are then processed at the Carlin roaster or the Twin Creeks autoclaves and additional gold is recovered from the flotation tails by cyanide leaching. The Phoenix mill produces a gravity gold concentrate and a copper/gold flotation concentrate and recovers additional gold from cyanide leaching of the flotation tails. Ore from the Midas mine is processed by conventional milling and Merrill-Crowe zinc precipitation. Activated carbon from the various leaching circuits is treated to produce gold dorÄ at the Carlin or Twin Creeks refineries. Zinc precipitate at Midas is refined on-site.
Goldberg said, ?Newmont owns, or controls through long-term mining leases and unpatented mining claims, all of the minerals and surface area within the boundaries of the present Nevada mining operations (except for the Turquoise Ridge joint venture). The long-term leases extend for at least the anticipated mine life of those deposits. With respect to a significant portion of the Gold Quarry mine at Carlin, we pay a royalty equivalent to 16.2% of the mineral production. We wholly-own or control the remainder of the Gold Quarry mineral rights, in some cases subject to additional royalties. With respect to certain smaller deposits in Nevada, we are obligated to pay royalties on production to third parties that vary from 1% to 8% of production.
The Long Canyon exploration project is located approximately one hundred miles from the Company╒s existing infrastructure at Carlin and we believe provides the potential for significant development and operating synergies. During 2012, the project entered into the selection and confirmation stage as we further develop our understanding of Long Canyon and the district. We have submitted a Plan-of-Operations to the BLM in support of our EIS for operations. We continue to make progress on the exploration program; total of 85 kilometers of drilling was completed in 2012 and we anticipate an additional 65 kilometers to be drilled in 2013. Our intention is to bring the project into production in 2017.?
Newmont has a 25% interest in a joint venture with Barrick in the Turquoise Ridge mine and an agreement to provide up to 2,000 tons per day of milling capacity at Twin Creeks to the joint venture.
Barrick is the operator of the joint venture. Gold production of 48,000 ounces in 2012 were attributable to Newmont. At Emigrant, in Elko County, construction is complete and commercial production was achieved on August 30, 2012. Gold production is expected to be 80,000 to 90,000 ounces per year. The Board of Directors authorized full funding for the Phoenix Copper Leach project in April 2012. Copper production is expected to be approximately 20 million pounds per year for the first five years of production at Costs applicable to sales of $1.75 to $2.00 per pound. First production is expected in the second half of 2013. During 2012, the project entered the selection and confirmation stage as
The company further develops the understanding of Long Canyon and the district. Newmont has submitted the Plan-of-Operations to the Bureau of Land Management in support of our Environmental Impact Statement. The company continues to make progress on the exploration program. A total of 85 kilometers of drilling
was completed in 2012 and the company anticipates an additional 65 kilometers to be drilled in 2013. The intention is to bring the project into production in 2017.
Goldberg added, ?We generated significant value in 2012, delivering net income from continuing operations of $1.9 billion and cash flow from operations of $2.4 billion on an attributable production base of 5.0 million ounces of gold and 143 million pounds of copper. Gold and copper production are expected to remain stable in 2013, but increases in Africa and Indonesia are expected to boost Newmont╒s free cash flow significantly in 2014 and 2015.
The company replaced reserve depletion for the fourth consecutive year and recently declared 99.2 million ounces of gold reserves and 9.5 billion pounds of copper reserves on an attributable basis. Key additions include 2.9 million ounces of gold reserves at our Merian project in Suriname and 2.6 million gold inferred resources at our Long Canyon project in Nevada. We reduced our exploration spending by 12 percent in 2012 and will trim it by another 25 percent in 2013 as we focus on our best opportunities.?