Newmont's LatAm gold output set to fall in 2022

Newmont – the biggest gold producer in Latin America – expects output in the region to fall 15% next year on factors including lower grades and the shift to residual leaching at Yanacocha in Peru (in picture).

Attributable production from the US-based company’s five Latin American mines is expected at around 1.47Moz gold, down from 1.73Moz originally forecast for 2021.

The biggest fall is expected at Peñasquito in Mexico, to around 475,000oz from 660,000oz this year.

The mine is on track to meet 2021 guidance, with 520,000oz gold produced in the first nine months.

“Peñasquito is expected to deliver lower gold production in 2022 due to lower-grade, harder ore mined from the Chile Colorado pit and stripping the next phases of the Peñasco and Chile Colorado pits continuing through 2023,” Newmont, which is also the world’s largest gold producer, said in its guidance release.

Silver production at Peñasquito is expected at around 29Moz, down from 30Moz, along with 150Mlb (68,000t) lead and 350Mlb zinc, down from 190Mlb and 475Mlb, respectively, guided for this year.

SOUTH AMERICA

In its South American region, Newmont expects higher attributable output from Merian in Suriname, which is due to rise to around 350,000oz gold from 320,000oz on higher grades, with slightly lower production in the following years.

Cerro Negro in Argentina is expected to produce around 260,000oz, down from 270,000oz in 2021, with output then steadily rising on higher throughput and development rates, with a first expansion, including development of the Marianas and Eastern districts, adding new production from 2024.

Newmont’s 51.35% attributable production from Yanacocha is forecast at 105,000oz in 2022, down from 160,000oz this year.

“Yanacocha continues to deliver leach-only production while developing the first phase of the sulfides project,” the company said.

A construction decision on the US$2bn Yanacocha sulfides expansion, which would extend operations into the 2040s, is expected in 2H22, according to the release.

Newmont’s 40% interest in Pueblo Viejo in the Dominican Republic, operated by 60% owner Barrick Gold, is guided at 285,000oz gold, down from 325,000oz in 2021.

Companywide gold production is forecast at 6.2Moz for 2022, and in the 6.0-6.8Moz range in each of the following four years.

CAPEX UP

Newmont set consolidated capex guidance at US$2.40bn for 2022, up from the US$1.90bn originally forecast for 2021.

The figure includes US$475mn of development capex and US$25mn sustaining capex at Yanacocha, US$75mn in development capex and US$50mn sustaining capex at Cerro Negro, US$125mn in sustaining capex at Peñasquito and US$50mn of sustaining capex at Merian.