Newmont Gold increases overall reserve base

One of America’s largest gold producers, Newmont Gold (NYSE), has increased its reserve base for the fifth consecutive year.

The cumulative reserve base has grown 50% since 1990.

Newmont ended 1995 with 28.8 million oz. gold in the proven and probable category, up 10% from 26.1 million at the end of 1994.

At its Carlin operation in Nevada, reserves increased to 20.9 million oz. gold from 18.5 million oz. a year earlier.

In Peru, reserves at Minera Yanacocha increased to 4.9 million oz. The company is preparing to bring its third mine, the San Jose, into production. Only four of the 14 known gold anomalies at Yanacocha have been fully delineated, and the potential for future discoveries is considered excellent.

In Indonesia, Newmont owns an 80% interest in the Batu Hijau project, which contains mineralized material totalling 14.7 million oz. gold, 27.6 million oz. silver and 11.2 billion lb. copper. The project is in the feasibility stage, and the company expects to make a development decision by year-end.

At the Minahasa project, also in Indonesia, construction is nearly complete, and mining has already begun. The first gold will be poured in April.

While overall reserves for the company increased in 1995, the amount of mineralized material declined to 25.9 million oz. from the previous year’s level of 30.2 million oz. This is explained by the fact that 4 million oz. were converted into reserves. Also, Newmont wrote off the Grassy Mountain deposit in Oregon, which accounts for 1 million oz.

In Mexico, Newmont’s inventory of mineralized material at its two 44%-owned gold projects, La Herradura and Mezcala, slid to 2.9 million oz. from 3.5 million oz. This is partly a result of a revision to the geological model.

Meanwhile, exploration drilling at the True North gold project in Alaska has led to an increase in the estimated gold resource. Reserves are now projected at 6.8 million tons grading 0.065 oz. per ton in the Hindenberg and Shepard orebodies, plus another 230,000-oz. resource.

Newmont holds a 65% interest in True North, with the remainder held by La Teko Resources (NASDAQ).

Newmont is planning a 14,000-ft. program of core drilling, to be followed by at least 50,000 ft. of reverse-circulation work, aimed at expanding known mineralization.