Newmont Mining Corp. Announces 2008 Gold Sales and Boddington Mine Acquisition

Newmont Mining Corp., a leading US gold producer, announced its 2008 gold sales of around 5.2 million troy ounces, in line with expectations. The company also acquired the remaining 33.3% stake in the Boddington mine in Western Australia from joint venture partner AngloGold Ashanti Ltd. Newmont's capital costs for Boddington are estimated at $2.6 billion to $2.9 billion.

The acquisition of the Boddington stake was funded through a $1.2 billion capital raising, which included public offerings of common stock and convertible notes. Securities in dual-listed Newmont fell up to 14% on the Australian Stock Exchange before recovering to trade at $6.14. Gold prices were also down overnight, and Newmont's share price on the New York Stock Exchange fell by about 4%.

The Boddington mine is expected to start production mid-year, with a nameplate capacity of 1 million ounces for the first five years of operation. The acquisition of the remaining stake in Boddington was seen as positive by analysts, with the company delivering gold sales in line with expectations.

Key Takeaways:

Newmont Mining Corp. announced 2008 gold sales of around 5.2 million troy ounces, in line with expectations.
The company acquired the remaining 33.3% stake in the Boddington mine in Western Australia from AngloGold Ashanti Ltd.
Capital costs for Boddington are estimated at $2.6 billion to $2.9 billion.
Newmont raised $1.2 billion through a capital raising, including public offerings of common stock and convertible notes.
Securities in dual-listed Newmont fell up to 14% on the Australian Stock Exchange before recovering to trade at $6.14.
Goldman prices were also down overnight, and Newmont's share price on the New York Stock Exchange fell by about 4%.
The Boddington mine is expected to start production mid-year, with a nameplate capacity of 1 million ounces for the first five years of operation.
Richard O'Brien, Newmont's president and CEO, stated that gold sales and costs were consistent with expectations for the year.

Statistics:

2008 gold sales: around 5.2 million troy ounces.
Capital costs for Boddington: estimated at $2.6 billion to $2.9 billion.
Number of ounces: 1 million (nameplate capacity for the first five years of operation).
Decrease in securities price: up to 14% on the Australian Stock Exchange.
Decrease in New York Stock Exchange share price: about 4%.
Consolidated capital expenditure for 2008: $1.9 billion.
Expected consolidated capital expenditure for 2009: $1.4 billion to $1.6 billion.

Sources:

Dow Jones Commodities News via Comtex, "Newmont Mining Corp. (NEM) Announces 2008 Gold Sales and Boddington Mine Acquisition", January 27, 2009.
Comtex SmarTrend Alert, "UPTREND on 11-24-2008 for NEM @ $31.47", January 23, 2009.