DENVER--(BUSINESS WIRE)--Newmont Mining Corporation (NYSE: NEM) (Newmont or the Company) has completed construction of the Merian gold mine in Suriname on time and more than $150 million or nearly 20 percent below its initial development capital budget. First gold was poured and Newmont declared commercial production on October 1, having achieved sustained average mill throughput of 80 percent and gold recovery of more than 90 percent over the last 30 days. Stockpiled ore represents nearly 160,000 contained ounces of gold.
Merian contains gold reserves of 5.1 million ounces1 and annual production is expected to average between 400,000 and 500,000 ounces of gold at competitive costs in the first five full years of production (100 percent basis). Costs are expected to be among the lowest in the portfolio, averaging between $575 and $675 per ounce in costs applicable to sales and between $650 and $750 per ounce in all-in sustaining costs in the first five years.2 Exploration has extended mine life from 11 to 13 years, and continues to identify further upside potential within Newmont's 500,000 hectare Area of Interest, including a new discovery at Sabajo.
'We took an optimized approach to project development and benefitted from being one of the only gold producers investing in growth during the lower price cycle,' said Gary Goldberg, President and Chief Executive Officer. 'Our team built Merian safely, on schedule and significantly below budget - and delivered our strategy to strengthen the portfolio by adding more than a decade of profitable production and creating a foothold in a prospective new gold district. This accomplishment is also the result of strong partnerships with the government and people of Suriname, and the extensive experience G-Mining brought to project development.'
The government of Suriname exercised its option to participate in a fully-funded 25 percent equity ownership stake in Merian in November 2013. Suriname manages its participation through Staatsolie, a Surinamese corporation that is wholly owned by the government.
Merian will operate under the banner of Newmont Suriname and be managed as part of Newmont's South America region in accordance with leading safety, technical, social and environmental standards. Its current workforce includes just over 1,100 employees, 20 percent of whom are indigenous Pamakkans, and 200 contractors. The team has taken a proactive approach to minimizing its environmental impact and engaged experts to inform its biodiversity offset programs. Newmont also signed an agreement with the Pamakkan community that establishes local hiring and procurement targets, as well as a community development fund.
Merian is one of Newmont's five self-funded growth projects - along with Long Canyon, expansions at Tanami and Carlin, and the recently completed expansion at Cripple Creek & Victor. Taken together, these projects are expected to add one million ounces of lower cost gold production over the next two years.
About Newmont
Newmont is a leading gold and copper producer with operations in the United States, Australia, Ghana, Peru, Indonesia and Suriname. Newmont is the only gold producer listed in the S&P 500 Index and was named the mining industry leader by the Dow Jones Sustainability World Index in 2015 and 2016. The Company is also an industry leader in value creation, supported by its leading technical, environmental, social and safety performance. Newmont was founded in 1921 and has been publicly traded since 1925.
Legal Cautionary Statement Regarding Forward-Looking Information
This release contains 'forward-looking statements' within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended, which are intended to be covered by the safe harbor created by such sections and other applicable laws. Such forward-looking statements may include, without limitation: (i) estimates of future production and sales; (ii) estimates of future costs applicable to sales and all-in sustaining costs; (iii) estimates of future capital expenditures; (iv) expectations regarding the development, growth and exploration upside potential and future production potential of Newmont Mining Corporation's (the Company) operations and projects, including, without limitation, relating to Merian (including at Sabajo), Long Canyon, expansions at Tanami, Carlin and Cripple Creek & Victor; (v) expectations regarding mine life; and (vi) expectations regarding project funding and returns. Estimates or expectations of future events or results are based upon certain assumptions, which may prove to be incorrect. Such assumptions, include, but are not limited to: (i) there being no significant change to current geotechnical, metallurgical, hydrological and other physical conditions; (ii) permitting, development, operations and expansion of the Company's projects being consistent with current expectations and mine plans, including without limitation receipt of export approvals; (iii) political developments in any jurisdiction in which the Company operates being consistent with its current expectations; (iv) certain exchange rate assumptions; (v) certain price assumptions for gold, copper and oil; (vi) prices for key supplies being approximately consistent with current levels; and (vii) the accuracy of our current mineral reserve and mineral resource estimates. Where the Company expresses or implies an expectation or belief as to future events or results, such expectation or belief is expressed in good faith and believed to have a reasonable basis. However, such statements are subject to risks, uncertainties and other factors, which could cause actual results to differ materially from future results expressed, projected or implied by the 'forward-looking statements'. Such risks include, but are not limited to, gold and other metals price volatility, currency fluctuations, increased production costs and variances in ore grade or recovery rates from those assumed in mining plans, political and operational risks, community relations, conflict resolution and outcome of projects or oppositions and governmental regulation and judicial outcomes. For a more detailed discussion of such risks and other factors, see the Company's 2015 Annual Report on Form 10-K, filed with the SEC on or about February 17, 2016, as well as the Company's other SEC filings. The Company does not undertake any obligation to release publicly revisions to any 'forward-looking statement,' including, without limitation, outlook, to reflect events or circumstances after the date of this news release, or to reflect the occurrence of unanticipated events, except as may be required under applicable securities laws. Investors should not assume that any lack of update to a previously issued 'forward-looking statement' constitutes a reaffirmation of that statement. Continued reliance on 'forward-looking statements' is at investors' own risk.