Newmont Mining Corporation
) is laying off 56 employees in Nevada owing to increasing costs
and rising prices of gold, according to Associated Press. The
company had to take this stand to remain competitive in the
current business environment.
The employees affected by the move will be granted severance
packages and will also be provided access to services which will
aid other job placement. Initially, Newmont thought of reducing
its workforce through attrition that averages 10% a year. The
company, however, decided to let go a number of employees as
relying only on attrition would not enable it to reduce labor
Newmont, a prominent player in the gold mining industry along
Barrick Gold Corp.
Kinross Gold Corporation
), is also considering selling its underground Midas mine in
Nevada so that it can focus more on its core businesses by
disposing its non-core assets. In this process, Newmont is
working consistently in line with its strategy to deliver value
to the shareholders.
Newmont's Midas underground mine operates through roughly 200
employees and is located in north central Nevada, between Elko
and Reno. The company acquired the mine through its merger with
Normandy Mining in 2002.
A few days ago, Newmont signed a Letter of Intent to divest
its Midas operation in Nevada to Waterton Global Resource
Management, Inc. The proposed deal is subject to necessary
regulatory and third party approvals along with execution and
delivery of an acquisition agreement and completion of
confirmatory due diligence.
During the second quarter of 2013, gold production at the
Nevada mine increased 1% year-over-year to 383,000 ounces,
attributable to higher grade and throughput at Phoenix and new
production from Emigrant. However, the positives were partially
offset by lower tons and grade at Midas.
BARRICK GOLD CP (ABX): Free Stock Analysis
GOLDCORP INC (GG): Free Stock Analysis Report
KINROSS GOLD (KGC): Free Stock Analysis
NEWMONT MINING (NEM): Free Stock Analysis
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Newmont currently maintains a Zacks Rank #3 (Hold).