Newmont hit with $1.6b write-off
US gold miner Newmont has made heavy write-offs against its Australian mines - Boddington and Tanami - totalling $US1.5 billion ($1.62 billion) following the slump in the gold price.
The group is in the process of cutting its global workforce by a third as it seeks to ensure it can survive with the downturn.
Locally, 38 jobs were cut at the regional head office in Perth in June, with 29 cut at the Tanami mine since the end of June, and 27 cut at Boddington over the past fortnight.
A further 80 jobs are to be cut at Boddington by the end of September, a spokesman for the company said this afternoon. These cuts do not include further positions cut by contractors.
“All our operations are actively reviewing costs in response to a lower gold price/higher cost environment," Newmont said in a statement.
"We expect this may result in a reduced scope of work in some areas and a possible reduction in employees and contractors.
“Rising costs ... and continued volatility in metal prices only reinforces the need to run our operations as safely and efficiently as possible to ensure success in any commodity cycle."
The write-offs, which total $US1.8 billion globally, come as other global gold miners such as Goldcorp and Newcrest have also made heavy write-offs and provisions against some of their higher cost mines amid pessimism over the near term outlook for the gold price.
In the June quarter, the Boddington mine in Western Australia produced 171,000 ounces of gold ast $US1307 an ouince and 16 million pounds of copper.
Gold and copper production declined by 5 per cent and 11 per cent respectively, it said, due to lower mill throughput partially offset by higher gold mill grade.
The outlook for the Boddington mine is poor unless there is a significant reduction in costs since all-in sustaining costs at the mine totalled $US1534 an ounce in the quarter.
Excluding the impact of the stockpile write-down, all-in sustaining costs were $US1088 per ounce, it said.
For 2013, the mine is expected to produce between 700,000 and 750,000 ounces of gold and 70 and 80 million pounds of copper.
