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Newmont to sell two WA gold mines

spartan gold

Newmont has revealed plans to divest six gold mines and two gold projects, two of which are in Western Australia.

The soon-to-be divested mines include Éléonore, Musselwhite and Porcupine – which are all in Canada – the Cripple Creek and Victor mine in the US, the Akyem mine in Ghana and the Telfer mine in WA, the latter of which Newmont inherited from its acquisition of Newcrest that concluded last November.

The US gold giant will also divest the 70 per cent stake it holds in the Havieron project in WA, which it inherited from Newcrest. Greatland Gold owns the remaining 30 per cent.

Newmont also plans to sell the Coffee project in Canada.

As reported by The Australian Financial Review, Newmont president and chief executive officer Tom Palmer said the mines are being divested as they don’t meet the company’s criteria of Tier-1 assets.

“We have a number of Tier-2 assets that are very good assets, run by very good people, but that don’t make our Tier-1 category,” he said.

Newmont has reportedly already received interest from potential buyers for the mines and projects.

The divestment announcement coincided with the release of Newmont’s 2023 full-year report, which detailed a strong outlook for the future following the acquisition of Newcrest concluding last November.

The US gold giant produced 5.5 million gold ounces (moz) and 891,000 gold equivalent ounces from copper, silver, lead and zinc in 2023. The results are in-line with Newmont’s revised guidance range following the inclusion of Newcrest’s assets.

Newmont generated $US2.8 billion of cash from continuing operations and brought in $US88 million in free cash flow. The company also delivered $US1.4 billion in dividends to shareholders.

However, the company’s net loss totalled $US2.5 billion, which was driven by $US1.9 billion in impairment charges, $US1.5 billion in reclamation charges and $US464 million in Newcrest transaction and integration costs.

Despite this, Newmont declared an increase in total reserves and resources. It now has 136moz in reserves and 174moz in resources.

“(The year) 2023 was a transformational year for Newmont, and for all of our stakeholders,” Palmer said.

“With the acquisition of Newcrest now complete, our principal focus for 2024 is to integrate and transform our leading portfolio of Tier-1 assets into a unique collection of the world’s best gold and copper operations and projects.”

Newmont currently holds $US8 billion in debt, so it has set a near-term debt-reduction target of $US1 billion for 2024. The company has also identified an additional $US500 million of cost and productivity improvements.

“With stable production and structured reinvestment throughout the year, we are strongly positioned to deliver on our commitments in 2024 and set the stage for meaningful growth in 2025 and beyond,” Palmer said.

Newmont anticipates its 2024 production guidance to equal about 6.9moz for its total portfolio, which will be underpinned by 5.6moz from its Tier-1 Portfolio.

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