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UPDATE 1-Newmont CEO says open to adding more copper production
September 24, 2013 / 9:30 PM / 4 years ago

UPDATE 1-Newmont CEO says open to adding more copper production

By Allison Martell

DENVER, Sept 24 (Reuters) - Newmont Mining Corp is open to adding more copper production to its core gold business, the company’s CEO said on Tuesday, as the biggest U.S. gold miner, along with its peers, seeks to revamp operations in a tough environment.

Newmont already has three copper-gold operations and as a result has “very good core capabilities that we can leverage into copper,” chief executive Gary Goldberg told delegates at the Denver Gold Forum, an industry conference.

“We’ve got good expertise, and I think the best thing to do for shareholders is to leverage that expertise and put copper on the list of things we would look at,” Goldberg told Reuters in an interview following the presentation.

Goldberg said the company will not target a specific percentage of revenue to come from copper.

Sliding gold prices and ballooning capital and operating costs have rocked the gold industry, making reliance on the precious metal alone less attractive.

“Two years ago you probably would not have been saying copper,” Goldberg said during the presentation. “There was a premium for gold producers.”

In late June, gold slid close to $1,180 an ounce, its lowest price in nearly three years. Gold is down more than 20 percent so far this year, while benchmark copper is down about 10 percent this year at $7,159 a tonne.

A move into copper may spook some investors after the disappointment that followed Barrick Gold Corp’s C$7.3 billion ($7.09 billion) takeover of Africa-focused copper miner Equinox Minerals in 2011.

The jewel at the center of that deal, the Lumwana mine in Zambia, has so far failed to live up to expectations, forcing Barrick to halt a planned expansion and book a $3.8 billion impairment charge on its value.

Goldberg said any copper asset purchase would have to help take Newmont “down the cost curve” and be in a jurisdiction where the company could manage the social, political and technical risks.


Peru’s minister of mining and energy was quoted in the Los Angeles times last week saying that Newmont’s Conga gold project could restart soon.

But Goldberg said that while the situation in Peru has improved, a restart is “not imminent.”

Newmont suspended construction in 2011 after violent protests, and later said it would focus on building water reservoirs and winning over the local population before moving forward.

“When you look at public opinion polls, they’re starting to move in our direction but we have a ways to go,” he told Reuters.

Goldberg said the earliest he would take the Conga project back to his board for a decision would be in early 2015, after elections in the region, and he would consult with local leaders and opinion polls at that point as well.

The project in northern Peru is a joint venture with Peruvian miner Companias de Minas Buenaventura.

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