Newmont bulks up US presence via Colorado acquisition

VANCOUVER — U.S.-based Newmont Mining (NYSE: NEM) has been on the lookout for low cost gold mines in favourable jurisdictions, and there likely isn't a friendlier place for the company than its home state of Colorado. On June 8 Newmont announced a deal with AngloGold Ashanti (NYSE: AU; ASX: AGG) that would see it pick up the long standing Cripple Creek and Victor mine located around 160 km due southwest of Denver.

Newmont will purchase the producing operation for US$820 million in cash and a 2.5% net smelter return (NSR) royalty for gold production from all future underground ore. The acquisition will be funded with proceeds of an equity issuance and supplemented with cash from the company's balance sheet.

The Cripple Creek gold district extends over 18 km² and has produced more than 25 million oz of gold since mining began there in the early 1890s. Today, Cripple Creek and Victor is the only major gold mine operating in Colorado and employs a non-union work force of roughly 550 people.

Read the complete article at NorthernMiner.com/news/newmont