The merger cost Newmont $10 billion and is expected to spur similar mergers in the gold mining industry, and creates a company that has mines in the Americas, Australia, and Ghana and makes it the largest producer of gold in the world.
Both companies say they will sell up to $1.5 billion in assets over the next two years and Newmont also promised initial cost savings from the merger of $100 million a year.
Following the merger, GlobalData, a data and analytics company says the merger which formed Newmont Goldcorp Corporation, will have an estimated gold production of 8.4 million ounces in 2019, equivalent to 7.1 per cent of global production, versus 5.6 million ounces for Barrick Gold, and 2.8 million ounces for Kinross Gold.
Vinneth Bajaj, Mining Analyst at GlobalData, said in comments: “While $1-1.5 billion of assets are expected to be sold over the next two years, initially the new entity will possess 83 gold projects, including 29 operating and 15 currently under development. The majority of the operations will be in the Americas, with Canada and the US, collectively accounting for 67.5 per cent of the total assets, followed by Australia (6 per cent), Peru (6 per cent), and Argentina (3.6 per cent). With this, Newmont has also entered into new geographical markets for extraction of gold, including Argentina, Chile, Mexico, and Dominican Republic.”
In comparison, Barrick Gold has 84 gold projects, of which 21 are in operation and Kinross has 25, with 13 in operation, GlobalData added.
By Emmanuel K. Dogbevi
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