Newmont Seeks Extension for Cadia Mine, Australia’s Largest Underground Gold Operation
Leading gold miner Newmont (NEM) has taken a significant step towards securing the future of its Cadia operation, Australia’s largest underground mine. The company has applied to extend the permit for the mine, located near Orange in New South Wales (NSW), until 2050. This move signifies a commitment to Cadia’s crucial role in Newmont’s portfolio and the broader Australian mining sector.
Cadia is a powerhouse in the Australian mining landscape, producing nearly 600,000 ounces of gold annually, along with a substantial portion of the country’s copper. The mine’s economic impact extends far beyond its production, generating over 2,100 full-time jobs and supporting hundreds of regional suppliers. Newmont’s annual expenditure on employee salaries at Cadia reaches approximately $135 million, highlighting the significant contribution the mine makes to the local economy.
Suzy Retallack, Newmont’s Chief Sustainability Officer, emphasized the positive implications of the extension, stating, “The extension of Cadia’s operations would be a tangible boost for responsible mining that contributes to global net zero goals, local jobs, and economic growth.”
The NSW Department of Planning, Housing, and Infrastructure will review Newmont’s application, which was submitted under the federal Environment Protection and Biodiversity Conservation Act. Cadia’s extension has already been designated as a state-significant project, aligning with state and federal priorities for regional economic stability.
Newmont’s commitment to sustainable practices at Cadia has been recognized through the mine’s recent receipt of the Copper Mark and the Molybdenum Mark, signifying its adherence to the highest standards in environmental, social, and governance practices. “Our global customers can now choose to source copper concentrate from an independently evaluated mine that meets the highest standards in environmental, social, and governance practices, responding to the increasing demand for sustainable supply chains,” stated Retallack.
Cadia stands as Australia’s sole operating source of molybdenum, a critical mineral vital for strengthening steel without adding excessive weight. The mine’s processing plant, with an investment of $85 million, has the capacity to produce approximately 4.1 million pounds of molybdenum annually.
Newmont’s decision to pursue the extension of Cadia aligns with its strategic focus on Tier 1 assets. Following the industry-shaking merger with Newcrest, whose flagship asset was Cadia, CEO Tom Palmer announced the company’s intention to divest from non-strategic operations. This strategy was recently demonstrated through the sale of the Akyem operation in Ghana to Zijin Mining, a transaction expected to generate approximately $1 billion to reduce debt and support investments in core assets.
While Newmont’s stock has seen a 14.74% increase year-to-date, it lags behind the performance of gold, a top-performing asset in 2023. The SPDR Gold Trust (GLD) has witnessed a remarkable 34% year-to-date gain. This indicates that despite the company’s commitment to Cadia and its focus on core assets, investors are still seeking greater returns from gold in the current market conditions.
