VANCOUVER (miningweekly.com) – The US's largest gold producer, Newmont Mining, has poured first gold at its new Long Canyon mine, in Nevada, saying it expects to declare commercial production next week ahead of schedule and below budget.

The mine is located about 160 km from the NYSE-listed company’s existing Nevada mining complex, comprising the the most significant oxide gold discovery in Nevada in more than a decade, with characteristics similar to the Carlin Trend, where Newmont has been operating for more than 50 years.

The project was completed for just under C$225-million – about $50-million, or 18% below budget.

During the first phase, the company will produce between 100 000 oz/y and 150 000 oz/y of gold over an eight-year mine life at some of the lowest costs in its portfolio. Costs applicable to sales are expected to average between $400/oz and $500/oz and all-in sustaining costs are expected to average between $500/oz and $600/oz.

“Taking a phased approach lowered initial development capital, helping to generate a 26% rate of return and reducing the payback period to just over four years. The project was further optimised by using refurbished equipment instead of new, building a leach facility instead of a mill, and leveraging our established infrastructure, expertise and stakeholder relationships in Nevada,” commented CEO Gary Goldberg.

Over the past two years, Newmont has succeeded in expanding the Long Canyon resource base by 30%, from an initial resource of 2.6-million ounces in 2013 to reserves and resources of 3.4-million ounces as at the end of 2015. Drilling continues with up to 11 drill rigs operating at Long Canyon this year. Newmont geologists have increased the mineralised strike by 70% to a length of more than 5 km, and oxide mineralisation remains open in all directions.

Long Canyon is one of four profitable operations Newmont has added to its portfolio in the last three years, including Merian, in Suriname, which was acquired in October; Cripple Creek & Victor, in Colorado, acquired in August 2015; and Akyem, in Ghana, acquired in November 2013. The company also sold $2.8-billion in assets in the same timeframe.