Newmont reports lower gold output, higher costs

Gold mining firm Newmont Mining has announced lower gold output and reserves for 2007 compared with the previous year.

The company said it produced 6.1 million ounces of the yellow metal last year, compared with nearly 7.2 million in 2006.

It also reported reserves of 86.5 million ounces of gold last year, down 7.9 per cent on 2006's total of 93.9 million.

In addition, the firm warned that its Boddington mine will see higher costs this year as a result of "labour and commodity cost escalation" and the negative effect of the Australian dollar exchange rate.

Newmont's report of lower gold reserves - which it said was down to being unable to replace all of the gold produced - may be a further indication of the overall global drop in gold mining production that has been noted by executives and analysts alike, potentially having implications for gold prices.

Nick Holland of Gold Fields recently told Mining Weekly that the effect of the energy crisis in South Africa could result in a drop in output of up to 20 per cent this year.

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