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Newmont Goldcorp (NEM) Halts Operations at Penasquito Mine

Zacks Equity Research
Newmont Goldcorp (NEM) is committed to good-faith dialogue with blockade leaders.

Newmont Goldcorp Corporation NEM plans to temporarily halt operations at the Penasquito mine, Mexico. The move is in response to the pending resolution of an illegal blockade by a trucking contractor and certain members of the Cedros community that started on Mar 27, 2019.

Newmont Goldcorp is committed to good-faith dialogue with blockade leaders. It continues to work with Mexican authorities for resolving the situation safely and on time. Per the company, a comprehensive contingency plan will enable the safe and orderly resumption of operations after the illegal blockade is lifted.   

Notably, the mine produced 272,000 ounces of gold in 2018. It also operates according to the national and international standards for environmental stewardship, safetyand social responsibility.

Newmont Goldcorp is among the prominent players in the gold mining industry along with Barrick Gold Corporation GOLD, Agnico Eagle Mines Limited AEM and Kinross Gold Corporation KGC. The company recorded net income from continuing operations of $113 million or 21 cents per share in first-quarter 2019, down from $170 million or 32 cents in the year-ago quarter.

Barring one-time items, adjusted earnings were 33 cents per share, which beat the Zacks Consensus Estimate of 26 cents.

Newmont Goldcorp expects attributable gold production of 5.2 million ounces in 2019.

The company expects all-in sustaining costs to be $935 per ounce for 2019. Also, costs applicable to sales expectation for gold is $710 per ounce.

The company’s attributable copper production forecast for 2019 is 45,000 tons. Copper costs applicable to sales (CAS) is expected to rise to $2.05 per pound in 2019, while all-in sustaining costs (AISC) is projected to rise to $2.45 per pound.

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