Newmont Mining has given the go-ahead for development of its Merian open-pit gold mine in northeast Suriname, with production planned to average 300,000 to 400,000 oz/y of gold over a project life of 11 years. During the first five years of operation, higher-grade ore will lift production to an average of 400,000 to 500,000 oz/y of gold. Pending receipt of the required "Right of Exploitation" from the government of Suriname, Merian production is scheduled to begin in late 2016.

Development of the Merian project represents entry into a new geographic region for Newmont. The project is located within the Guiana Shield of northeast South America, near the Suriname-French Guiana border and 66 km south of the town of Moengo. Newmont's current major gold operations are located in Nevada, Australia, Peru and Ghana.

Total capital investment to develop the Merian project is estimated at $900 million to $1 billion. The government of Suriname has the option to earn a 25% fully funded equity ownership stake, including all project capital and operating expenses and an initial earn-in contribution. Newmont expects to fund its share of development through available cash balances and projected cash flows.

Total capital investment to develop the Merian project is estimated at $900 million to $1 billion. The government of Suriname has the option to earn a 25% fully funded equity ownership stake, including all project capital and operating expenses and an initial earn-in contribution. Newmont expects to fund its share of development through available cash balances and projected cash flows.

Project development will include three open pits, a processing plant, and the associated infrastructure, including waste rock disposal areas, a tailings storage facility, and a worker accommodation camp. The processing rate is planned at 12 million mt/y during the first five years of operation. Total material moved over that period will average 50 million mt/y.

Average costs applicable to sales of Merian gold production are expected to be in the range $650 to $750/oz during the first five years and between $725 and $850/oz life of mine. Average all-in sustaining costs are estimated at between $750 and $850/oz during the first five years and between $825 and $960/oz life of mine.

Merian has 4.2 million oz of gold in reserves at an average grade of 1.22 g/mt. Newmont's "Mineral Agreement" with the government Suriname includes an area of interest of 500,000 ha that offers promising exploration upside.

Merian will operate under the bannerof Surgold, a wholly owned Newmontsubsidiary. Initial development will include upgrading of roads and preparation of the camp, mine and mill sites. The project is expected to employ 2,500 people during development and 1,300 duringfull operation.

Newmont President and CEO Gary Goldberg said, "The decision to develop Merian marks an important milestone in our portfolio optimization process-we have divested nearly $800 million in non-core assets to help fund the next generation of lower-cost projects in our portfolio. Equally important, we established community agreements and are working with experts to minimize our impact on the environment-getting it right from the beginning is critical."

Newmont is forecasting company-wide attributable gold production of 4.7 million to 5 million oz for 2014.

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