Newmont suspends two Canadian mines, shelves forecasts

Mine haul trucks at the Eleonore gold mine in northern Quebec. Source: Newmont Goldcorp Corp.

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Newmont Goldcorp Corp. [NGT-TSX; NEM-NYSE] said Monday March 23 that it is withdrawing its full-year 2020 production forecasts and putting some operations temporarily into care and maintenance.

It said the move is part of an effort to protect the health and safety of its workforce, the families and neighbouring communities from the impact of the COVID-19 global pandemic.

Holding operations that result from Newmont Mining’s recent US$10 billion takeover of Canadian mining giant Goldcorp, Newmont Goldcorp now ranks as the world’s largest gold producer with assets across the Americas, Africa and Australia.

“We are also making sure that these short-term disruptions do not impact long-term business value while ensuring we are well positioned to safely and efficiently ramp-up operations in a timely manner once the worst of this global pandemic passes,” said Newmont Goldcorp President and CEO Tom Palmer.

The four suspended operations include Musselwhite (Opapamiskan Lake, Ont., Eleanore (James Bay, northern Quebec), Cerro Negro (Argentina) and Yanacocha (Peru), which together represent roughly 20% of the company’s 2020 production guidance.

In the first quarter of 2020, Newmont says it now expects to produce approximately 1.4 million attributable ounces of gold. So far this year, the company has produced 981,000 ounces.

On Monday, Newmont shares rose 8.3% or $4.82 to $62.57.  The shares are currently trading in a 52-week range of $70.42 and $40.01.

Newmont Goldcorp also noted that it is currently not experiencing any significant delays in shipping concentrate or transporting and refining doré bars. However, it warned that this may occur in the coming days/weeks if certain government shutdowns or border restrictions are required.

“We currently have no confirmed COVID-19 cases among our workforce and are taking significant, proactive measures including social distancing at all of our sites, removing substantial numbers of non-critical  workers from our operations, closing offices with employees working remotely, and stopping all non-essential business travel to ensure we don’t become a pathway for transmission to others,” Palmer said.

“These are unprecedented times for all industries, and while this pandemic brings a lot of uncertainty, Newmont is well positioned to safely and responsibly generate long-term value for all of our stakeholders,” he said.

At the Musselwhite operation, Newmont has decided to limit personnel on site to minimize fly-in/fly-out activity to prevent the possible transmission of the virus into communities, including nearby First Nations communities in northern Ontario. It said essential personnel will remain on site to maintain infrastructure, continue environmental management and provide security.

At Eleanore, the company said it has decided to limit personnel on site to comply with the Quebec government’s restrictions on non-essential travel within the province and to prevent the possible transmission of the virus into communities, including First Nations communities.

At Cerro Negro, Newmont said it will have to limit personnel on site due to the halt of all domestic flights and mass transportation in Argentina through March 31. Remaining on site will be essential personnel to maintain infrastructure, continue environmental management, and provide security and continue ground control activities.

At Yanacocha, as previously disclosed, mining operations were in the process of safely ramping down due to government travel restrictions in-country, while gold production from leach pads and critical safety, security and environmental management activities continue.

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