Indonesia businessman asks court to block sale of local company’s Newmont stake – by Eveline Danubrata and Yuddy Cahya (Reuters U.S. – April 12, 2016)

JAKARTA, April 12 An Indonesian businessman has filed a request to a Jakarta court to put on hold any deal that would involve transferring ownership of a nearly 18 percent stake held by a local company in Newmont Mining Corp’s Indonesian operations.

Gustaaf Merukh, who owns a stake in the local company PT Pukuafu Indah, is suing other shareholders in Pukuafu, including his own relatives, according to court documents dated Feb. 5 seen by Reuters and an interview with his spokesman.

Merukh says these shareholders faked his consent to use Pukuafu’s 17.8 percent stake in Newmont’s local unit, PT Newmont Nusa Tenggara, as collateral to get a $600 million loan in 2012 from the U.S. parent, Choky Simanjuntak, head of Merukh’s legal and public relations team, told Reuters by phone.

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Slow Suffocation of the US Mining Space – by Christopher Ecclestone (Investorintel – January 19, 2016)

The old adage about the frog in the boiling water slowly getting cooked without jumping out is a good metaphor for the mining industry in the US over the last 12 months.

While the big story in commodity circles has been the oil price decline, a far more potent force has been the currency moves. The rampant US dollar has “saved” the bacon of many a miner in Australia, Canada, South Africa and elsewhere while brutally pressure-cooking those that are focused on the mining space in the US.

The chart above sourced from US Global Investors shows the last twelve months’ move in the gold price in various currencies. The USD gold price is clearly the laggard while Brazil has been stellar. It’s a pity there are not more Brazilian gold mining opportunities on offer. Ironically the strength of the Real for the preceding five years meant that Brazil was not such a good place for junior explorers to spend their drilling dollar.

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Once booming, Nevada gold output falls to 1988 level – by Sean Whaley (Las Vegas Review Journal – September 12, 2015)

CARSON CITY — Gold production in Nevada fell to less than 5 million ounces in 2014, the first time since 1988 that output of the precious metal has dipped so low.

A new state Division of Minerals report shows 4.94 million ounces of the precious metal was taken from 30 Nevada mines in 2014. There was about 5.5 million ounces of gold produced in Nevada in 2013.

The peak year in recent memory was 1998, with just under 9 million ounces.

Richard Perry, administrator of the Division of Minerals, said it appears production has leveled off in the 5 million ounce range over the past five years. While production has fallen, Nevada mines still throw of gold valued at $5.5 billion, at $1,100 per ounce, he said.

“We need better gold prices to see more projects and new mining,” Perry said. The lower gold production is due largely to the price of gold, which hit a high of nearly $1,800 per ounce in 2012 but has dropped to about $1,100 as of Friday.

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History of the Carlin Trend (Elko Daily Free Press – May 1, 2015)

CARLIN — On May 4, 1965, with little fanfare, Newmont poured its first bar of gold from the Carlin Mine. The pomp and circumstance of the official commissioning of the mine would have to wait a few more weeks. That first bar marked the start of one of the largest and longest-lived mining districts in the world.

In summer 1961, geologists John Livermore and Alan Coope arrived in Carlin to visit the Blue Star mine and the Gold Quarry prospect. Livermore had recently heard a talk by U.S. Geological Survey geologist Ralph Roberts about an area in northern Eureka County that had the potential for hosting gold deposits.

The type of deposit they were searching for was similar to Getchell, Gold Acres and Bootstrap, deposits in which the gold was dispersed as microscopic particles that could not be found using a gold pan. After visiting and examining the local deposits, Livermore and Coope began exploring an area approximately 2¾ miles south of Blue Star on Popovich Hill. They postulated that gold would be found in the limestone rocks below a regional fault known as the Roberts Mountains Thrust.

Drilling on the project began in 1962 and on the third hole intersected 100 feet of mineralization averaging 1.03 ounces of gold per ton, marking the discovery of what would become the Carlin Mine. Drilling to outline the orebody progressed quickly and by the end of 1963 had identified 11 million tons of ore averaging 0.300 ounces of gold per ton, a grade sufficient for mining when gold was selling for $35 per ounce. Construction of the mine and mill began in 1964.

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(Nevada Mining) Editorial: The Romance of Mining (Elko Daily Free Press – May 1, 2015)

(This editorial from 50 years ago is being republished in honor of Newmont Mining Corp.’s celebration of 50 years on the Carlin Trend.)

Historically, Nevada has been a mining state. The great Comstock Lode, which helped to bring this state into the Union, Tonopah’s silver and Goldfield’s gold are part of the romantic heritage which has come down through the years. The great copper mines of Ely and Weed Heights have added to the lustre, to say nothing of the wealth of this state and the nation.

There have been numerous other finds in the state’s history leading to the building of mining towns, some passing into oblivion almost overnight. Mountain City, the great Rio Tinto copper mine, Pioche, Austin, Eureka and such other romantic names as Tuscarora, Cornucopia, the Divide near Tonopah, Gold Aces and many others have passed in review.

As Dr. John Hulse said in his recently written “The Nevada Adventure”, “Nevada was basically unwanted and unloved in those days (before mining). It was a barrier to a promised land, rather than an asset in itself. But this soon changed.”

Yes, it changed with Virginia City and the mining finds which followed throughout the state. James Finney, whose real name may have been James Fennimore, according to Dr. Hulse, was exploring the hills at the head of Gold Canyon in the winter of 1858-1859 when he found a mound, soon to be named Gold Hill.

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UPDATE 3-Indonesia threatens to take over Newmont mine if output stays shut – by Wilda Asmarini and Fergus Jensen (Reuters India – July 18, 2014)

JAKARTA, July 17 (Reuters) – Newmont Mining Corp risks its Indonesian mining licence being taken over by a state-owned firm if the U.S. miner does not resume copper production, the Southeast Asian nation warned, escalating a six-month dispute over export rules.

The move represents a hardening of the stance of Indonesia’s outgoing government. The mining ministry earlier this week said it could terminate Newmont’s mining contract in response to the miner stopping production and filing legal arbitration over the export rules.

The developments mark the latest twist in the dispute between Indonesia and U.S. miners Newmont and Freeport-McMoRan Inc that has led to a halt in copper concentrate shipments from Southeast Asia’s biggest economy.

Indonesia plans to soon send a letter to Newmont saying that the company has defaulted on its contract, said Sukhyar, director general of coal and minerals at the mining ministry. “The default is due to the stopping of production, so we can say they are negligent,” Sukhyar told reporters on Thursday.

A Newmont spokesman did not comment on the risk of the company losing its mining licence at its Batu Hijau copper mine but said in an email that the company is eager to resume production as soon as the government issues it an export permit.

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Newmont Gives Glittering Opportunities for Ghana’s Talent – by Joe Kirschke (Engineering and Mining Journal – July 3, 2014)

Since Portuguese navigators first arrived in the 15th century, mining, production and export of gold have been integral to Ghana’s history. Through the later christening of a “Gold Coast” by British colonialists and the emergence of sub-Saharan Africa’s first sovereign nation in 1957, Ghana today also hosts the continent’s No. 2 reserves of the ore.

Yet as in all too many developing nations, Ghana’s gold mining business, representing 90% of 2011 mineral exports—and $2.7 billion by Q3 2013—is not always a kind one. Fatalities from artisanal mining have been toxic as its mercury, while unrest involving illegal Chinese miners culminated in 169 deportations to their mainland last year. “Gold is a curse to this nation!” thundered a columnist in The Chronicle, a local newspaper, shortly thereafter.

But many elements of Ghana’s mining culture—in particular Accra’s ratification of U.N. International Labor Organization (ILO) standards—reflect positive clarity, too. Others include worker apprenticeship programs at Newmont Mining Corp.’s Ahafo and Akyem projects—samples of how, via smart Corporate Social Responsibility (CSR), profits and prosperity are sparkling hand-in-hand in one of Africa’s most mature democracies.

The apprenticeships date back to 2004 when 722 local men and women joined the construction phase of the Ahafo mine ahead of Q3 2006’s first production, said Adiki Ayitevie, communications director for Newmont Africa. The program was soon upgraded to a “Semi-Skilled Metals Construction Labor Program,” wherein 324 young men and women were trained in metal working and safety; the World Bank’s International Finance Corp. (IFC) investment wing noted Ahafo was already ahead of schedule, given strong community engagement.

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Frustration Builds for Newmont Investors – by ALISTAIR MACDONALD and JOHN W. MILLER (Wall Street Journal – July 9, 2014)

Shareholders Lose Patience, Urge Gold Miner to Break Itself Up or Revive Deal With Barrick

In the lobby of the local Elko, Nev., office of Newmont Mining Corp. NEM +2.42% , the world’s second-biggest gold miner by production, a series of posters celebrate almost a century of mining, exploration—and fighting takeovers.

But after another attempt to take over the company failed in April, many investors have lost patience. They are urging the miner to either rekindle this year’s aborted deal with No. 1 Barrick Gold ABX.T +0.35% Corp., or break itself up.

All gold miners are facing a lengthy list of problems—lower gold prices, high costs and declining accessible gold grades. Newmont, based in Greenwood Village, Colo., posted a loss of $2.5 billion last year, the biggest in its history, and its share price has fallen by half since 2011, making it one of the worst performers in the S&P 500.

Investors “are frustrated because they wanted something to happen, after being bruised and battered for the past 18 months,” said Dan Denbow, a portfolio manager for the San Antonio-based United Services Automobile Association, a Newmont shareholder.

Newmont “hasn’t communicated the specifics of what they’re doing,” he said. Now, as many Newmont shareholders clamor for action, the question is: what kind of change do they want?

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Elko-area mines still thriving despite continued slide in gold prices – by Sean Whaley (Las Vegas Review – Journal – June 21, 2014)

ELKO — Nevada’s mining industry might be taking a hit right now because of low gold prices, but walk through this city on any weekday about 6 a.m. and you wouldn’t know it.

Workers in pickups and mining rigs, most of them with the ubiquitous red warning flags called buggy whips, crowd Idaho Street, the main drag. Long lines of traffic roll in from the residential areas south of town along the Lamoille Highway as locals head to the mines for another workday.

Gold prices have plunged over the past 18 months, dropping from a high of about $1,800 an ounce in 2012 to about $1,315 Friday, but don’t tell the people of this mining-centric town in northeastern Nevada. Although some operations are struggling to stay open, here the boom continues for the most part unabated.

Mining is the ninth largest economic sector in Nevada based on gross domestic product, according to the U.S. Commerce Department. There were 12,600 direct mining jobs in Nevada in 2012.

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Gold Miners Feel Lucky in Search for Nevada Buried Riches – by Liezel Hill (Bloomberg News – June 18, 2014)

It’s not just gamblers, celebrity chefs and brides-to-be that find Nevada irresistible. About 400 miles north of the Las Vegas strip, the world’s two biggest gold producers are doing some prospecting too.

Even after more than a century and a half of exploration, Barrick Gold Corp. (ABX) and Newmont Mining Corp. (NEM:US) say there’s plenty of hidden gold still to be uncovered in Nevada, which already accounts for a third of their output and produces more of the metal than South Africa and Chile combined. The miners are refining exploration techniques, while looking deeper and in areas they’d previously dismissed to find new resources.

“In a lot of ways, even as mature as northern Nevada is, it’s still young from a discovery standpoint,” said Doug Livermore, Newmont’s regional project director for North America. The state accounts for more than 6 percent of global gold production.

With the 28 percent drop in gold prices last year forcing miners to look for lower-cost ways to increase output and cut exploration budgets, companies such as Barrick and Newmont are focusing more on existing holdings. Nevada’s deposits also offer lower investment risk than mines in less politically stable regions of the world.

One of the two potential new mines that Greenwood Village, Colorado-based Newmont is considering is in Nevada.

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Newmont Suspends Indonesian Operations As Minerals Export Issue Remains Unresolved – by Trefis Team (Forbes Magazine – June 9, 2014)

Newmont Mining has announced the suspension of operations at its Batu Hijau mines in Indonesia. This follows the halt in production and processing of copper concentrate at its Indonesian operations after its copper concentrate storage facilities were filled to capacity.

The company had halted exports from Indonesia in January, as a law banning exports of unprocessed minerals from the country came into effect. Though last minute changes to the law permitted Newmont to export its copper concentrates, they imposed a 25% tax on exports which would rise to 60% by 2016. The company claimed that this tax violated the terms of its original investment agreement, or contract of work, with the Indonesian government.

The company is engaged in negotiations with the government regarding the export duty, leading to resumption of its exports from the country. The company invoked the force majeure clause of its contract of work, in order to suspend operations, after its storage facility was filled to capacity and production could not be continued.

The suspension of production will impact Newmont’s quarterly and annual results, though the extent of the impact will be determined by the duration for which operations remain suspended.

A law enacted in Indonesia in 2009 banned exports of unprocessed minerals from the country with effect from January12, 2014.

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Gold miners bump up their dividends – by Brenda Bouw (Globe and Mail – October 23, 2011)

The Globe and Mail is Canada’s national newspaper with the second largest broadsheet circulation in the country. It has enormous influence on Canada’s political and business elite.

VANCOUVER – Gold miners are sweetening their shareholder payouts in an attempt to lure investors as they dive back into the precious metal.

Barrick Gold Corp. and Newmont Mining Corp. two of the world’s top producers, announced increases to their dividends on Wednesday, while Goldcorp Inc. hinted a hike is in the works.

Gold companies traditionally have paid low dividends, but they’re stepping up payouts as they compete for investors in the precious metals industry.

More investors are turning to gold as a haven amid turmoil in global financial markets, which stems from worries about a replay of the last global recession.

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Gold miners seek to close the gap with bullion – by Brenda Bouw (Globe and Mail – September 20, 2011)

The Globe and Mail is Canada’s national newspaper with the second largest broadsheet circulation in the country. It has enormous influence on Canada’s political and business elite.

VANCOUVER— The world’s top gold miners are forging ahead with expansion plans and higher dividend payments, despite worries that bullion is bound for a correction after a spectacular runup beyond $1,900 (U.S.) an ounce earlier this month.

The companies are vowing to tackle the issue of share values that lag gold prices through aggressive growth plans, rising margins and sweetened dividends, despite the challenges of rising costs and increased competition for investors.

Executives believe that the price of gold will continue to rise and that equities will soon catch up and could even surpass physical gold in returns to investors.

“I do think the equities will respond,” Barrick Gold Corp.chief executive office Aaron Regent told investors at the Denver Gold Show in Colorado Springs, Colo., on Monday. “The equities have not reflected the strong fundamentals of the underlying businesses.”

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Newmont President and Chief Executive Officier Robert T. O’Brien on Sustainable Gold Mining

Newmont President and CEO Robert T. O’Brien - Company PhotoThere is a New Day Dawning at Newmont and each day affords us the opportunity to renew our commitment and dedication to be an industry leader as we strive to achieve our vision of becoming The Gold Company of Choice through industry leading performance. We have reaffirmed the values that guide us as we seek the most effective ways to provide sustainable value for our employees, our communities and our shareholders by “acting with integrity, trust and respect.”

In 2007, we began to redirect the company and our business strategy. We established a new management team and implemented initiatives that will enable us to dedicate ourselves to Newmont’s core gold business, to expand our growth and exploration opportunities and to unlock the value embedded in our capital structure, as well as reduce operating costs.

Key highlights during the year included:
• Producing 5.3 million equity ounces of gold, in line with our original guidance and expectations;
• Investing significantly in our business, including more than $1 billion in new gold projects and operating efficiency initiatives;
• Eliminating our gold hedge book, which positioned Newmont as the premier un-hedged gold company, and improved our financial strength and flexibility;

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