Newmont ups gold reserves by 26%

Exploration along the Carlin gold trend is paying off for Newmont Gold (NYSE), as shown by gold reserve figures released by the 90% owned subsidiary of Denver-based Newmont Mining (NYSE).

Going into 1990, the company said it had the largest reserve position of any North American gold producer with 20.5 million oz., compared with 16.3 million oz. last year.

Homestake Mining (NYSE) of San Francisco and Placer Dome (TSE) of Vancouver, North America’s other million-ounce gold producers, have 11.4 million and 20.2 million in proven and probable ounces of reserves respectively.

Newmont Chairman Gordon Parker attributed the 26% reserve increase to intensive exploration along the 45-mile Carlin gold trend where the company owns 15 deposits.

“In 1989 alone, we invested more than $20 million in exploration and reserve development at Newmont Gold,” said Parker who expects the company’s annual gold output to increase to 1.5 million oz. this year from 1.4 million oz. in 1989.

Some outstanding intersections were announced recently at Carlin’s Deep Star area, 500 yards north of Newmont’s Genesis gold mine (T.N.M., Oct. 9/89).

Since the Deep Star discovery hole intersected 350 ft. of grade 0.768 oz. per ton in August, other strong intersections have been reported, including 233 ft. of grade 0.476 oz., 253 ft. of grade 0.753 oz. and 174 ft. of grade 0.635 oz.

However, according to Parker, the largest gain in reserves was reported at the company’s Post deposit in the northern sector of its operations.

“The Post deposit is expected to have 6.1 million oz. at the end of 1989, compared with 1.6 million oz. at the end of 1988,” he said. Newmont’s Post claims adjoin American Barrick Resources’ (TSE) Goldstrike mine where reserves last year stood at 12 million oz.

Also, exploration in Nevada has expanded Newmont Gold’s geologic resources to an estimated 39.7 million oz. at year-end from 37.1 million oz. at the same time last year.

In addition to proven and probable reserves, gold resources include other mineralization for which no economic mining plan has yet been developed but whose extraction is considered feasible by management.

Newmont’s 1989 resource category included 10.5 million oz. of gold in refractory material whose grade ranges from 0.010 oz. to 0.060 oz., the company says.

Over the next three years, Newmont Gold expects to invest about $150 million on new equipment, including two new plants designed to treat refractor y ore, a tailings dam and dewatering facilities.

In addition to a 90% stake in Newmont Gold, Newmont Mining also owns 49% of gold producer Newmont Australia and 55% of Peabody Holding, the largest coal producer in the U.S.