Newmont Mining(NEM) & Newmont Gold(NGC) Message Board

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Gold/Mining/Energy : Newmont Mining(NEM) & Newmont Gold(NGC)

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To: Traveling Man who wrote (464)	4/1/2002 4:22:21 PM
From: Tommaso	Read Replies (1) of 587

The debate (or quarrel) that has been going on over at the ABX thread is whether, when all expenses of running the company are factored in, they are producing gold at that figure ($217 per ounce for "The New Newmont"--see the table in the PDF URL that you provided). Some people assert that the real cost, taking into account amortization of properties and other things, is really a good bit higher. If you total Newmont's expenses for the year 2000 and divide that by the ounces of gold produced, you get a cost of production of over $300 an ounce. I don't know zip about accounting, gold company or otherwise, and am not espousing any view. I am just trying to figure what NEM ought to be worth as an investment at varying levels of gold prices. It LOOKs to me as if every increase in the price of gold over $305, approximately, ought to produce a leveraged effect on Newmont's income. . Would enjoy hearing from someone who understands gold company finance as well as, say, Jim_p understands oil company finance (see Biog Dog's Boom Boom thread).

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