Mining giant Newmont to spend half a billion dollars expanding Australia's largest gold mine
/ By Bridget FitzgeraldMining giant Newmont will spend $500 million to expand the South Pit at its Boddington mine site.
Newmont Boddington Gold lies about 130 kilometres south-east of Perth and is the largest producing gold mine in Australia.
The funding, approved by the Newmont board this week, will improve long-term sustainability and extend the life of the mine.
The mine expansion is a significant turnaround for the company, which last year reported that its Asia Pacific division could consider relocating projects overseas if the gold price did not improve.
Mr Bates said fuel prices and exchange rates had worked in favour of the company.
But he said Newmont had also been focussed on improving efficiency measures.
"[We have started] optimisation of our milling circuits and using different materials," he said.
"And additionally, we are running the plant for longer so really, [we've had] great gains in our maintenance efficiencies."
Mr Bates said the expansion was a great vote of confidence in the future of the mine and would extend the mine's life until at least 2025.
He said the funds would be used to extend the wall of the South Pit at Boddington and expand the site waste dump.
Newmont has already been granted state and federal government approval for the project, which is set to begin in early 2016.
Mr Bates said the expansion plan had "always been in [Newmont's] business plans".
But he said, based on recent gold price performance, the board had to decide whether expansion plans remained viable.
"It does make economic sense so we've gone and asked for [funding] and indeed we've received it," he said.
"It's absolutely the timeline we were aiming for."
The spot gold price was at US$1,166 an ounce at the time of publication.