Barrick, Newmont Complete Nevada Joint Venture
An agreement on a joint venture was reached earlier in the year when Newmont Mining rejected a takeover bid by Barrick, with the two companies instead deciding to form a joint venture for their Nevada properties in order to capture expected synergies, which officials are estimating at up to $500 million per year during the first five years. The new joint-venture company, owned 61.5% and operated by Barrick, and 38.5% by Newmont Goldcorp, was officially launched Monday.
The joint venture be world’s largest gold-producing complex, with three of the world’s top 10 Tier One gold assets -- Goldstrike/Carlin, Cortez and Turquoise Ridge/Twin Creeks -- and potentially another one in the making at Goldrush, officials said.
In all, assets in northeastern Nevada include 10 underground and 12 open-pit mines, two autoclave facilities, two roasting facilities, four oxide mills, a flotation plant and five heap leach facilities. In 2018, these operations produced a total of 4.1 million ounces of gold, approximately double that of the industry’s next largest gold mine (Muruntau in Uzbekistan).
Officials said Nevada Gold Mines is targeting production of between 1.8 million and 1.9 million ounces in the second half of 2019, with the preliminary estimate for all-in sustaining costs put at $920 to $950 per ounce.
“Its creation was driven by a compelling logic which had long been evident to all but had been elusive for two decades until we finally achieved a breakthrough this year,” said Mark Bristow, Barrick president and chief executive officer, who is chairman of the new joint-venture company.
Gary Goldberg, Newmont Goldcorp’s CEO, said the joint venture “will extend safe, profitable and responsible production much further than what each company could have done on its own.”
The Nevada Gold Mines management team included executives from both joint-venture partners. The executive managing director is Greg Walker, formerly head of operations for Barrick’s North American region. Barrick has three board seats and Newmont Goldcorp two, with the board supported by technical, finance and exploration advisory committees on which the two companies have equal representation.