Boddington Gold Mine, Perth, Australia

The Boddington Gold Mine (BGM) is about 130km south-east of Perth in Western Australia. The largest undeveloped gold mine in the country, it is poised to become the highest producing mine once production ramps up over the next few years.

The $2.4bn project was initially a three-way joint venture between Newmont Mining, AngloGold Ashanti and Newcrest Mining. In 2006 Newmont bought Newcrest’s 22.22% share, bringing its interest to 66.67% and ending any Australian ownership. AngloGold owns the remaining 33.33%.

The original, mainly oxide open-pit mine was closed at the end of 2001.

The project has an attributable capital budget of between A$0.8bn and A$0.9bn. On 23 July 2009, the project, including the construction of the treatment plant, was completed. Production began in the third quarter of 2009. The first gold and copper concentrate was produced in August 2009.

Approximately 100,000t of ore was processed by mid-August. Gold production began on 30 September 2009. By 19 November 2009, the mine achieved commercial production.

The project has an attributable capital budget of between A$0.8bn and A$0.9bn. At year-end, the overall project was approximately 65% complete, with engineering and procurement activities nearing completion. Construction of the treatment plant was approximately 32% complete. At its peak the project is expected to employ some 2,000 workers.

Based on the current plan, mine life is estimated to be more than 20 years, with attributable life-of-mine gold production expected to be greater than 5.7Moz.

Newmont and Anglo have focussed their exploration activities on the poorly explored areas of the greenstone belt outside the already identified Boddington Expansion resource. The exploration strategy is to identify the resource potential of the remainder of the greenstone belt, with the emphasis on high-grade lode-type deposits.

Geology and reserves

The BGM is located within the Saddleback Greenstone Belt (SGB), a fault-bounded sliver of Archaean volcanic and shallow level intrusive rocks, surrounded by granitic and gneissic rocks. The SGB produced over 6Moz of gold and is a highly prospective exploration area for further gold mineralisation in both large tonnage stock-work gold resources and high-grade lode-type gold resources.

As of the end of 2009, proven ore reserves at Boddington were 184 million tons graded at 0.025oz/t. Probable reserves stood at 781 million at grade 0.021oz.

Mining

Built on the footprint of the original Boddington Gold Mine, the operation involves open cut mining from two large pits and is expected to produce an average 850,000oz of gold and 30,000t of copper a year for more than 20 years.

Production is due to commence in late 2008/early 2009 under the management of the Boddington Gold Mine Management Company, a 100% Newmont-owned company.

Production

Average attributable gold production in the first five years will be 1,000,000oz a year, while on an average life-of-mine basis, attributable production is estimated to be between 250,000oz and 270,000oz a year. Copper production, which will be sold as concentrate, is expected to be around 30,000t per year. In 2009, approximately 103,300oz of gold and 9.0 million pounds of copper were sold from Boddington.

Processing

Copper and gold containing ore will be crushed to a coarse size before the ore is sent to the treatment plant via a conveyor. At the treatment plant, the ore is crushed further and ground finely to slurry. The ore is initially processed by flotation, which produces copper/gold concentrate with about 18% copper.

Fine liberated gold is recovered by processing flotation concentrates through a gravity circuit before it is de-watered and stored. It is then ship-loaded for delivery to the smelters. The residual gold content found in the flotation tailings is recovered through carbon-in-leach circuit.