THE GLOBAL SEARCH FOR GOLD SPECIAL — Newmont ups gold output and earnings

Record quarterly gold production has sparked an increase in earnings for Newmont Gold (NGC-N).

The company earned US$21.6 million for the second quarter (before a gain on an asset sale and writeoff), compared with US$18.6 million in the same period last year

Newmont attributed the increase partly to a US$2 rise in the realized price of gold.

The company’s share of production in the second quarter was 549,800 oz. gold — 30% more than in the same period last year. Gold was produced from four mines, which are situated in Carlin, Nev. (399,500 oz.), Yanacocha, Peru (81,200 oz.), Muruntau, Uzbekistan (42,200 oz.) and Minahasa, Indonesia (26,900 oz.).

The company recently signed a definitive agreement with Sumitomo Corp. to develop the Batu Hijau copper-gold deposit in Indonesia. Under the agreement, Newmont will have a 45% interest, Sumitomo 35%, and Indonesian-based P. Pukuafu Indah 20%. The project contains a resource of 14.7 million oz. gold and 11.2 billion lb. copper.

The Penmont joint venture, in which the company has a 44% interest, has begun engineering work for an open-pit gold mine at the Herradura deposit in northern Mexico. The deposit contains a resource of 1.8 million oz. gold and could support production of 150,000 oz. per year, beginning in 1998.

Meanwhile, exploration work is proceeding along the Carlin trend, as well as in Yanacocha, and at grassroots projects in Alaska, Latin America and Southeast Asia.