Newmont agrees purchase of Ashanti’s Cripple Creek & Victor mine in Colorado for $820m

8 June 2015 (Last Updated June 8th, 2015 18:30)

Newmont Mining has agreed to acquire the Cripple Creek & Victor (CC&V) gold mine in Colorado, US, from AngloGold Ashanti in an $820m deal.

CC&V

Newmont Mining has agreed to acquire the Cripple Creek & Victor (CC&V) gold mine in Colorado, US, from AngloGold Ashanti in an $820m deal.

Newmont's deal also included a net smelter return royalty of 2.5% for gold production from potential future underground ore.

Net proceeds generated from a common equity issuance of 29 million shares would be used by the company to fund the acquisition.

Newmont president and CEO Gary Goldberg said: "CC&V represents a value-accretive opportunity for Newmont to improve mine life and costs in a favorable jurisdiction.

"Consistent with what we've achieved elsewhere, we believe we can lower direct mining costs by up to 10% through improved productivity and optimisation."

"We believe we can lower direct mining costs by up to 10% through improved productivity and optimisation."

AngloGold Ashanti has completed about two-thirds of the mine expansion, which includes a new leach pad and recovery plant, and a mill to boost production.

The acquisition of CC&V will add between 350,000oz and 400,000oz of gold per year in 2016 and 2017 for Newmont.

Subject to regulatory approvals, the transaction is due for completion in the third quarter of 2015.

The surface CC&V mine, which has been operational since 1995, is located near Colorado Springs in Teller County, Colorado.

Th initial mine expasion conclused in 2013, with the addition of an ore crusher and a leach facility.

AngloGold approved and initiated the second expansion in 2013 and expects the leach facility and associated recovery plant to be commissioned during the second half of 2016.


Image: Cripple Creek & Victor open-pit gold mine, north of Victor, Colorado, US. Photo: courtesy of Plazak.