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Newmont Announces Acquisition of Buenaventura’s Stake in Yanacocha

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Newmont Announces Acquisition of Buenaventura’s Stake in Yanacocha







District Consolidation of Owned and Operated Asset Enhances World-Class Portfolio


Newmont Corporation (NYSE: NEM) (TSX: NGT) and Compañia de Minas Buenaventura S.A.A. (NYSE: BVN) (Lima Stock Exchange: BUE.LM) announced that the companies have entered into a definitive purchase agreement through which Newmont will acquire Buenaventura’s 43.65% interest in Minera Yanacocha.


“Newmont has successfully operated in Peru for more than 30 years and has deep knowledge of the asset and the value it brings to Newmont stakeholders. Buenaventura has been an exceptional partner and we look forward to continuing a strong relationship,” said Newmont President and CEO Tom Palmer. “This acquisition gives Newmont control of the Yanacocha district where we are positioning the sulfides project for profitable production and value generation for decades to come. We are committed to continuing to be a catalyst for sustainable development in Peru by working closely with communities in the Cajamarca region and the Peruvian government.”


Consistent with Newmont’s district consolidation strategy, the acquisition enhances the Company’s ownership of world-class assets. Newmont continues to advance its sulfides project at the pace the pandemic allows, investing more than half a billion dollars through 2022 as the project continues to progress toward a full-funds decision later this year. The sulfides project will increase Newmont’s copper position, supporting the transition to a green economy.


Under the terms of the agreement Newmont will acquire Buenaventura’s interest for $300 million plus contingent payments of up to $100 million, in part tied to higher metal prices. Concurrently, Newmont will transfer its ownership interest in the La Zanja joint venture to Buenaventura in exchange for royalties on any future production from the La Zanja operation. Newmont will also contribute $45 million to Buenaventura to cover future closure costs at La Zanja.


Newmont may also have an opportunity to fully consolidate ownership of Yanacocha, as Sumitomo is assessing whether to exercise a right in its 2018 purchase agreement to return its 5% interest to Yanacocha in exchange for the original purchase price.


Newmont 2022 and Long-term Capital Outlook


With the acquisition, Newmont is updating previously issued attributable development capital guidance to account for the sulfides project. All other guidance metrics remain unchanged from long-term outlook as announced on December 2, 2021.


Guidance Metric ($M) (+/- 5%) 2022   2023   2024   2025   2026
Attributable Sustaining Capital 925   825 – 1,025   825 – 1,025   825 – 1,025   825 – 1,025
Attributable Development Capital 1,400   1,300 – 1,500   1,100 – 1,300   400 – 600   100 – 300
Total Attributable Capital 2,325   2,225 – 2,425   2,025 – 2,225   1,325 – 1,525   1,025 – 1,225


The sulfides project will develop the first phase of sulfide deposits at Yanacocha through an integrated processing circuit, including an autoclave, to produce 45% gold, 45% copper and 10% silver. The project is expected to add average annual production of 525,000 gold equivalent ounces per year with all-in sustaining costs between $700 and $800 per ounce for the first five full years of production (2027-2031). An investment decision is expected in the second half of 2022 with a three-year development period. The first phase focuses on developing the Yanacocha Verde and Chaquicocha deposits to extend Yanacocha’s operations to 2040, with second and third phases having the potential to extend life for multiple additional decades.


About Newmont

Newmont is the world’s leading gold company and a producer of copper, silver, zinc and lead. The Company’s world-class portfolio of assets, prospects and talent is anchored in favorable mining jurisdictions in North America, South America, Australia and Africa. Newmont is the only gold producer listed in the S&P 500 Index and is widely recognized for its principled environmental, social and governance practices. The Company is an industry leader in value creation, supported by robust safety standards, superior execution and technical expertise. Newmont was founded in 1921 and has been publicly traded since 1925.


Posted February 8, 2022

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