Newmont Aims to Nearly Double Development Capex for 2022, Increase Gold Production

Researched by Industrial Info Resources (Sugar Land, Texas)--Gold miner Newmont Corporation (NYSE:NEM) (Greenwood Village, Colorado) plans to embark on what its executives say will be its most significant investment period in a generation as it seeks to catch up on projects that were delayed as a result of the COVID-19 pandemic, and greenlight other projects that are part of its long-term growth plan.

Industrial Info is tracking more than $10 billion worth of Newmont projects across four continents. Subscribers to Industrial Info's Global Market Intelligence (GMI) Metals & Minerals Project Database can click here for a list of detailed project reports.

Click on the image at right for a graph showing Newmont's project investments by country.

In its 2022 guidance presentation on December 2, company executives said Newmont's development capital for next year will amount to $1.4 billion, compared with $750 million in 2021. Exploration and advanced project spending will total $450 million in 2022, up from $390 million this year, while yearly sustaining capital expenditures will remain the same at $1 billion.

Chief Executive Officer Tom Palmer said the next two and a half years "are going to be the most significant investment period that Newmont has had in at least a generation."

He attributed the capex upswing partly to the COVID-19 pandemic causing projects to "stack up on each other, a bit more than would have been our intent," as well as the planned sequencing of new project rollouts.

The company expects production to ramp up from 7.2 million gold-equivalent ounces (GEOs) (including 6 million ounces of gold and 1.2 million ounces of co-products like silver and copper) in 2021 to 7.5 million GEOs in 2022. Newmont's guidance calls for production to rise to as much as 8.3 million GEOs by 2026.

Chief Financial Officer Nancy Buese said the planned capex increase is largely due to projects at Newmont's Tanami and Ahafo mining operations in Australia and Ghana, respectively, as well as the Yanacocha Sulfides project in Peru and others.

Subscribers can click here for details of the Tanami Stage 2 expansion in Australia, which is planned for completion in mid-2024, and here for details of the Ahafo North expansion, which is expected to reach completion in 2023.

Chief Operating Officer Rob Atkinson said a decision to fully fund the Yanacocha Sulfides mining project in Peru will be made in the second half of 2022. Click here for the project report.

Also in line for full financial approval in 2022 is a project to extend the mine life of Porcupine mine in Timmons, Ontario. The development of the Pamour open pit operation would extend the mine life through 2035 and add 1.6 million pounds of gold production. Click here for a related project report.

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