26-Aug-2023: Some excellent points there @Bushmanpat and it will be interesting to see what Newmont do with the three Newcrest mining centres. Clearly, Cadia is Newcrest's best mine by a country mile, and Lihir is a distant second. Telfer is basically a basket case and everybody is expecting Newmont to sell off Telfer fairly quickly after they gain full control of Newcrest. Cadia is high grade and very profitable, so it's in Newmont's interests to spend whatever they need to - to fix the dust and any other issues there - but you're right - dust is the main problem there and dust is far from easy to control from OP mining. Cadia would undoubtedly be the MAIN reason why Newmont is acquiring Newcrest. They like big and highly profitable gold mines - like Boddington.

Newmont's Boddington Gold Mine in WA is one of Australia’s largest producing gold mines. Commercial production of gold and copper concentrate began in 2009 and the mine reached two million ounces of gold production in August 2012. 2moz in 3 years is a decent mine!! Newmont also own the Tanami Gold Mine in the NT, around 540km from Alice Springs in the Tanami Desert.

And they're no mugs, being the largest gold miner on Earth. The second largest, Barrick Gold, have sold ALL of their Australian assets and have indicated that Australia is too competitive for them and they have no plans to operate in Australia in the foreseeable future. That's the view of Barrick Gold's CEO & President Mark Bristow anyway. Newmont are bigger than Barrick and Australia doesn't scare them, and they are in the process of acquiring the world's 7th largest gold mining company, Australia's Newcrest Mining, to consolidate their position as the world's largest gold miner.

Further Reading: Top 10 largest gold mining companies in Q1 2023 - report | Kitco News

Australia only has one other company in that top 10, and that's Northern Star Resources (NST) at #10, soon to move up to #9 (when Newcrest are removed from that list) and I would expect them to move even higher once they complete their recently announced (Board-approved) $1.5 billion expansion of their Fimiston Mill in the WA Goldfields, which is part of their "Super Pit" operations alongside Kalgoorlie. NST believe that paves the way for them to become one of the world's top five gold producers. See here: Northern Star Resources approves $1.5 billion upgrade to KCGM's Super Pit Fimiston processing plant - ABC News [22 June 2023]

The expansion of NST's Fimiston Mill is expected to more than double Fimiston's processing capacity from 13 million tonnes a year to 27 million. The self-funded expansion is already underway and is due to be completed in 2026, at which point the Super Pit would supersede Newmont's Boddington Gold Mine as Australia's largest gold operation.

The 35-year-old Fimiston Mill has struggled to meet the output of NST's mining operations in the area, which has resulted in a backlog of about 120 million tonnes of pre-mined ore, estimated to hold about 3 million ounces of gold. That stockpile would be a "key feed source" for the new mill and would provide some clear visibility around future production. NST's chief technical officer (CTO) Steven McClare was quoted (in that ABC News article I've provided a link to above) as saying, "If we stopped mining today, we could process that material and it would take more than nine years to actually get through that stockpile. As we are continuing to mine in the open pit and underground, that stockpile continues to build."

Anyway, that's NST, and their bright future (and Yes, I am an NST shareholder, and it's one of my largest positions both here and IRL), but this straw is supposed to be about Cadia and open pit dust. I guess that also does apply to NST's Super Pit, considering it's one of Australia's two largest open pits (Newmont's Boddington Gold Mine being the other one), AND because it (the Super Pit) sits right alongside Kalgoorlie, the larger half of the city of Kalgoorlie-Boulder - see here: Home » City of Kalgoorlie-Boulder (ckb.wa.gov.au), being the largest population centre in the WA goldfields. So, it's something they all have to deal with.

But my point is that Cadia is too valuable an asset to NOT sort that sh!t out - i.e. even if Newcrest has failed to fix it by the official hand-over-the-keys date, the mine's new owner, Newmont Gold, the world's largest gold mining company, WILL sort it out. I have NEVER had any faith in Newcrest (NCM) management - they've been paid FAR too well for mostly turning what was once a great Australian gold miner with a high ROE and great metrics into a very mediocre gold miner that has destroyed a huge amount of value and potential shareholder wealth in the process. That is why they have in recent years had so much shareholder activism at their AGM's and had so many shareholders (including "Subs" & Instos) vote AGAINST their remuneration reports - see here: Newcrest Mining cops another strike on executive pay (afr.com) [9th November 2022]

It doesn't surprise me that Newcrest have dragged their feet on fixing the dust issues at Cadia. Their attitude at Telfer is to virtually defund the mine and force them to band-aid fix everything so it can keep limping along. It keeps producing, but equipment that needs to be replaced is always repaired instead, and rarely properly, just temporary repairs, and it's a horrible place to work and to live (it's a FIFO operation). People always get sick there from either the water or the food - it's like Australia's Bali, but without any of the Beaches or good stuff. People get Telfer-Belly, usually the first and second time they work there. Some people seem to get over it after that. My brother has done shuts (shutdown maintenance work) there on a number of occasions and now refuses to go there. They can't even provide the night shifts with sleeping quarters that are quiet during the day. It's just a horrible place to be, even when they're not working. Two of the mining contractors (companies) that Newcrest had doing the mining at Telfer actually walked off the job or pulled out and broke their contracts before Macmahon (MAH) took it on. Then MAH threatened to leave as well if Newcrest refused to renegotiate and pay higher rates. That dispute was settled to Macmahon's satisfaction and they now claim to be making money at Telfer when they were previously struggling to hit breakeven there and actually losing money some years. One of their biggest issues was finding people willing to work there, and then go home, and then come back again. Many never came back for their second "week on". It meant offering more money, and Newcrest didn't want to pay more money, hence the dispute. Macmahon have got a lot smarter with the way they structure contracts now, as all the succesful mining services companies have had to, and the clients now have to wear the extra costs in situations like that, either through schedule-of-rates adjustments (that are built into the contracts, i.e. that rates may increase if the labour market moves or higher rates are otherwise required to attract suitable workers) or other cost-pass-through mechanisms that have become standard for such ongoing contracts nowadays. Without such mechanisms, companies would go broke if they continued to work at a loss for these miners.

But back to Regis: I think the extra hoops that Regis are being forced to jump through to get McPhillamys up is a positive for the industry and the environment - the less miners pollute and bother their neighbours the better. Ideally, in a couple of hundred years, the area should have been returned to either productive farmland or else native bushland with no adverse environmental impacts. Unfortunately, that has NOT been the experience of the vast majority of communities across the globe when mines have eventually shut down - but that history doesn't need to be repeated. We CAN do better, and we MUST do better, and that all starts with stronger legislation and permitting conditions, and that's what we're seeing with McPhillamys. The downside is the length of time it all takes, but it will be worth it.

P.S. I sold my Regis (RRL) shares here on Friday, to buy more GNG (GR Engineering) - I'll do a straw on them (GNG) and LYL (Lycopodium) shortly - I still hold RRL in my three largest RL portfolios (including my SMSF) but they are likely going lower during the next year, in part because they still have some very low priced hedging to close out over the next 10 months, and also because McPhillamys will likely take longer than many might have expected, and people will lose interest and sell. There is a possibility that RRL might try to acquire another gold mine, or another gold mining company to help provide the cashflow to fund the McPhillamys build, because I don't think Duketon + 30% of Tropicana is going to be enough myself - without an additional dilutive CR - but if that M&A were to happen it might create even further downward pressure on the RRL SP because they would be the acquirer, not the target, and the market believes they overpaid for (30% of) Tropicana and will likely think the same about a subsequent acquisition, if they were to make one. I'm just going to hold them through IRL because I think the upside with McPhillamys is worth the wait, but they're smaller positions, not like NST which is always a larger position because the near-term upside is so much better (and clearer).

My issue here is that I'm dealing with a capped pool of capital - with my virtual portfolio here on SM - I can't buy something unless I sell something, and I definitely want to increase my exposure to GNG & LYL here before they go ex-div (GNG does on Sep 4th, LYL on Sep 21st), because their dividend yields are outstanding! And they are both growing, especially LYL, so growth PLUS income, so I had to sell something - in fact two somethings - and RRL was an obvious choice because I figure I've got some time (like at least 10 months) and I can buy back in and probably at a lower level - before the McPhillamys-induced positive market re-rating of Regis occurs, which I think it will, but not just yet. The other one I tried to sell, and still have for sale, is Macmahon (MAH), the mining contracting company that Newcrest use to do all of the mining at Telfer - and Regis + AngloGold Ashanti use to do all the mining at Tropicana - because, again, they (MAH) haven't done much lately, and I'm starting to wonder if they're going to do much over the next 12 months, or AS much as a company like LYL is likely to. Much, as in their share price, and their total shareholder return (including dividends). I like the odds with GNG and LYL over the next 12m better than with MAH and RRL, but I reserve the right to hold all 4 of them in the future. I still hold MAH in one RL portfolio, but they are under review. Macmahon just seem to be treading water more than powering ahead. The past year has been VERY good for gold miners, with gold hitting it's highest price EVER in both US and Australian Dollars, and a mining services contractor who specialises in gold mining should also be doing pretty well in that environment. Now we have seen the gold price come off a bit from those all-time highs, and it's still a very competitive environment for these contracting companies, so I'm starting to think that MAH may not be one of my best ideas for the next 1 to 5 years. I'm still working through that argument, however I've made the decision (on Friday) to exit MAH here on SM to load up on LYL instead.

27-Aug-2023: Correction: I've corrected Mr. Bristow's first name above (to Mark instead of Dennis). The CEO & President of Barrick Gold is Dennis Mark Bristow, but he is known as Mark Bristow, not Dennis Bristow. He uses his middle name rather than his first given name.