The Newcrest Mining Ltd (ASX: NCM) share price is down 3.7% in early trade.
Newcrest closed yesterday at $28.20 and is currently trading for $27.16.
Shares look to be coming under pressure amid a fall in gold prices, with bullion down 2.5% overnight. That’s seen the S&P/ASX All Ordinaries Gold Index (ASX: XGD) open down 3.3% today.
Below we take a look at how the S&P/ASX 200 Index (ASX: XJO) gold miner’s Canadian acquisition is progressing.
What’s the latest on the ASX 200 gold miner’s acquisition?
The Newcrest share price is dipping despite the miner reporting it has completed its acquisition of Pretium Resources Inc, known as Pretivm.
Following the transaction, Pretivm will be delisted from the New York Stock Exchange and Toronto Stock Exchange.
Via the acquisition, Newcrest gains ownership of Pretivm’s Brucejack mine, located in British Columbia, Canada. According to the release, Brucejack counts amongst the highest-grade operating gold mines in the world.
Newcrest expects Brucejack will result in an immediate increase in its gold production and cash flows, quoting expected synergy benefits of some US$12 to $16 million annually. The Canadian asset is forecast to produce 95–115 thousand ounces of gold during Newcrest’s ownership in the 2022 financial year.
Commenting on the acquisition, Newcrest’s CEO, Sandeep Biswas said:
Through this acquisition and the continued development of our outstanding organic growth pipeline, Newcrest’s base case gold production is expected to remain strong until at least 2030, and we have a range of further upside opportunities being progressed across the portfolio. This production profile is also expected to drive a major reduction in All-In Sustaining Costs, which makes Newcrest unique in the industry.
Moving forward, Biswas added, “Our exploration team will be progressing an extensive drilling campaign across the Brucejack mineral claims which make up one of the largest epithermal footprints we have ever seen. The land package is largely unexplored and very early in its life…”
Newcrest share price snapshot
On the back of soaring gold prices (which retreated 2.5% overnight), the Newcrest share price has gained 19% over the past month. By comparison, the ASX 200 is down 3% in that period.
Year-to-date Newcrest shares are up 13%.
The post Here’s why the Newcrest (ASX:NCM) share price is in the red today appeared first on The Motley Fool Australia.
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More reading
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The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.
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