Newmont records lower copper, gold production from Batu Hijau

US gold mining giant Newmont Mining Corp. reported on Wednesday its first quarter 2004 copper and gold production from the Batu Hijau mine in Sumbawa island West Nusa Tenggara decreased to 141 million pounds and 95,100 ounces, respectively, from 152 million pounds and 124,000 ounces in last year?s corresponding quarter.

Newmont said the decline in production was mainly due to the sequencing of increased stripping and lower grade ore processed.

Batu Hijau recorded an average realized copper price for the first quarter of $1.50 per pound, reflecting an average spot price of $1.24 per pound and provisional pricing and timing and other miscellaneous adjustments of $0.26 per pound.

Batu Hijau?s total copper cash cost increased sharply from US$0.42 per pound in last year?s first quarter to $0.66 per pound. The company said the increase in operating costs were due to Higher operating costs were incurred as a result of increased grinding costs due to harder ores, higher mining rates and higher mine maintenance costs as eight additional haul trucks were added to the fleet.

Newmont said in 2004, capital expenditure for Batu Hijau would range between $45-50 million, but it did not provide detail.

Newmont also said that Batu Hijau is expected to begin paying dividends in 2004 and this will result in a decrease in Newmont's reported economic interest from 56.25 percent to 52.875 percent, in recognition of the economic interest held by the project's Indonesian shareholder. (alex)