Newmont updates industry-leading reserve portfolio

Newmont (TSX: NGT; NYSE: NEM) has reported its 2020 year-end reserve and resource update, and its 94.2 million oz. of attributable gold reserves are the largest in the industry, the gold miner says. In addition, over 90% of the reserve inventory is in ‘top-tier’ jurisdictions, with an operating reserve life of over 10 years and at an average grade of 1.03 grams gold per tonne. 

Approximately 35% of the company’s gold reserves are in North America, 33% in South America, 20% in Australia and 12% in Africa.

The company also noted that it had significant gold reserves per share, with 117 oz. per 1,000 shares the “highest in the industry.”

“Newmont’s ability to replace reserves is underpinned by our disciplined operating model and world-class portfolio which will support stable production for decades to come,” Tom Palmer, the company’s president and CEO, said in a Feb. 10 press release.

In 2020, Newmont added 6 million oz. to reserves, with close to 5 million of these ounces added through drilling. Last year’s reserve depletion of 7.5 million oz. included divestments of the KCGM (Kalgoorlie Consolidated Gold Mines) and Red Lake operations in Australia and Ontario. The company has not yet reported 2020 production numbers, and its latest guidance was for 6 million gold oz. last year.

Exploration-driven reserve growth of 4.9 million oz. includes 800,000 oz. added at the Ahafo mine in Ghana, from drilling at Subika Underground. The Tanami underground mine in Australia added 600,000 oz., while the Nevada Gold Mines joint venture grew Newmont’s reserve portfolio by 800,000 ounces. A further 1.1 million gold oz. was added through mine plan improvements.

At Canadian operations, Eleonore added 1.3 million oz. to reserves, both due to positive drill results and cost improvements and Porcupine contributed 3 million oz., which more than offset depletion.

Measured and indicated gold resources total 69.6 million oz. and inferred resources add 31.6 million oz. to the portfolio. Exploration added 3.4 million measured and indicated oz. to the inventory and 3.5 million inferred ounces.

Beyond gold, Newmont also has 6.9 million tonnes of copper, 613 million silver oz., 1.3 million tonnes of lead, and 3.1 million tonnes of zinc in reserves.

The 2021 exploration spend is expected to be approximately US$215 million, with 80% of this total allocated towards near-mine expansion programs; 28% is budgeted for North America, 25% for South America and 20% for Australia.

Proven and probable reserves total 2.9 billion tonnes grading 1.03 grams gold per tonne; with a further 3.3 billion measured and indicated tonnes at 0.65 gram gold per tonne and 1.5 billion inferred tonnes at 0.65 gram gold per tonne.