Newmont steps up pressure against W. Australia’s royalty hike
The head of Newmont Mining (NYSE:NEM), Australia’s No.1 gold producer, will meet West Australian Premier Colin Barnett on Tuesday in an effort to persuade him of avoiding extra imposts on the gold industry.
CEO Gary Goldberg warned last week that a royalty hike would jeopardize the profitability of Australia’s two largest gold mines: the Superpit in Kalgoorlie-Boulder and Boddington. And he believes gold miners are to blame.
According to The Weekly Times, Newmont’s chief has said that industry’s failure to properly disclose the costs of doing business is partly responsible for the wave of royalty increases recently imposed in other countries, such as Ghana and Indonesia, where the company also operates.
The US-based gold giant, which also owns the Tanami mine in the Northern Territory, has recently scaled back its Australian portfolio by selling the Jundee mine to ASX-listed Northern Star.
One for all, all for one
Last week, a coalition of WA gold miners launched an advertising campaign against any royalty increase, adopting the tactics used nationally in the attack on the mining tax.
The so-called “Heart of Gold” campaign will involve radio advertising, an online petition and social media.
Gold miners operating in the state fear the royalty hike might be doubled as part of a current government review of the regime.
An independent analysis by advisory firm Deloitte Access Economics shows that a gold royalty increase of only 5% would reduce Western Australia’s gross state production by an initial A$110-million in 2015/16 and A$240-million in 2016/17.
Western Australia’s goldfields have powered the Kalgoorlie region for more than 130 years and the industry hopes the new campaign will underline how important gold mining is to the state.