Newmont Mining Corporation has started commercial production at Long Canyon project, Nevada, US.
Long Canyon is a higher grade oxide mine in the gold district, located less than 100 miles from its present
The company announced commercial production based on sustaining plant availability of more than 85% and reaching a minimum of 70% of modelled leach recovery.
The project was completed two months before schedule with an investment of within $225m, which is approximately $50m or 18% below budget.
In the first phase, the mine is expected to generate around 100,000oz and 150,000oz of gold per anuum over an eight-year mine-life at estimated costs applicable to sales of between $400 and $500 per ounce, as well as all-in sustaining cost of between $500 and $600 per ounce.
The company took phased development approach to optimise the project by using refurbished equipment instead of new machinery. It has also built a leach facility rather than a mill.
Long Canyon project is expected to provide 26% rate of return with a payback period of less than four years at present gold prices.
The operation comprises a surface mine and heap leach pad that holds one million tonnes of ore at an average estimated grade of 1.13g of gold per tonne.
Development of the project was funded through free cash-flow and available cash balances, as well as by leveraging the company’s existing infrastructure and expertise.
Newmont president and CEO Gary Goldberg said: “Long Canyon marks the fourth profitable new operation we’ve added to the portfolio in the last three years, including Merian in Suriname last month, Cripple Creek & Victor in Colorado last year, and Akyem in Ghana in late-2013.
“We have completed these organic growth projects on or ahead of schedule and at or below budget; delivered a profitable expansion at Cripple Creek & Victor earlier this year; and are on track to complete value-adding expansions at Tanami by 2017 and at Carlin by 2018.
“These portfolio improvements set the stage for Newmont to continue generating superior free cash-flow, which gives us the means to continue investing in profitable growth, retiring debt and returning cash to shareholders.”
The company claimed that Long Canyon is one of the most significant oxide gold discoveries in Nevada during the last decade.
Currently, Long Canyon Phase 2 studies and evaluation are underway. Newmont intends to complete and secure permission before Phase 1 is depleted.
Image: Aerial view of a gold mine. Photo: courtesy of Uncle Kick-Kick (Patrick Huber)/ Wikipedia.