Global bullion major Newmont has flagged delays and cost increases at its expansion projects in Australia and Africa, citing current market conditions for labour and materials, as well as delayed land access in Ghana.

The $395-million Tanami Expansion 2 project, in Australia’s Northern Territory, will cost 25% more than the prior estimate, Newmont said on Monday, stating that the cost blowout was the result of significant impacts from Covid-related restrictions and protocols, as well as the current market conditions for labour and materials.

Newmont is the latest company operating in Australia to warn of a competitive labour market. BHP, Rio Tinto, Whitehaven Coal, Yancoal Australia and South32 all flagged pandemic-led labour disruptions during the most recent quarter.

Newmont pushed out commercial production for the project, which will extend Tanami’s life beyond 2040, to early 2025.

Tanami Expansion 2 entails a new 1 460 m hoisting shaft and supporting infrastructure to process 3.3-million tonnes a year, increasing the mine’s output by 150 000 oz/y to 200 000 oz/y for the first five years and reduce operating costs by about 10%.

At Ahafo North, in Ghana, where Newmont is building four new openpit mines and a standalone mill about 30 km from the Ahafo South operations, the schedule is also behind, and costs are rising.

The gold miner reported that development costs since approval, excluding capitalised interest, were $142-million, of which $75-million related to the six months ended June 30. Newmont said that capital costs would be about 15% above the prior estimate, citing costs associated with delayed land access.

Commercial production for the project, which will add between 275 000 oz/y and 325 000 oz/y in the first five full years of production, is now expected to be in mid-2025.

“Ahafo North is the best unmined gold deposit in West Africa with approximately 3.5-million ounces of reserves and more than one-million ounces of measured, indicated and inferred resources and significant upside potential to extend beyond Ahafo North’s current 13-year mine life,” the company said.

Newmont would provide formal updates to Tanami Expansion 2 and Ahafo North’s capital estimates and estimated project completion dates later in the year.

Meanwhile, Newmont will late this year announce investment decisions for two more projects – the $2.5-billion Yanacocha Sulphides, in Peru, and the $350-million to $450-million Pamour project, in Canada.

Yanacocha Sulphides will develop the first phase of sulphide deposits and an integrated processing circuit, including an autoclave to produce 45% gold, 45% copper and 10% silver. The project is expected to add average gold production of 525 000 gold equivalent ounces a year for the first five full years.

The first phase focuses on developing the Yanacocha Verde and Chaquicocha deposits to extend Yanacocha’s operations beyond 2040 with second and third phases having the potential to extend life for multiple decades.

Pamour will extend the life of the Porcupine mine and maintains production, beginning in 2024. The project will optimise mill capacity, adding volume and supporting high-grade ore from Borden and Hoyle Pond, while supporting further exploration in a highly prospective and proven mining district.

Newmont is also advancing the Cerro Negro District Expansion project, in Argentina, which entails the simultaneous development of the Marianas and Eastern districts to extend the mine life of Cerro Negro beyond 2030.

The project is expected to improve production to above 350 000 oz, starting in 2024.