Newmont’s purpose is to create value and improve lives through sustainable and responsible mining. This report covers what we did to improve our performance on both fronts – and against a backdrop of ongoing market volatility – during my second year as Newmont’s President and Chief Executive Officer.
The safety and health of our people come first, and in 2014, we lowered our total injury rate by 17 percent to levels that are among the lowest in the mining industry. Despite this progress, our team suffered two tragic losses with the fatalities of Simon Donkor and George Ayamah at our operations in Ghana. The road to zero harm never ends, and some of the steps we took last year included launching a safety leadership coaching program for our supervisors, and leading collaborative efforts to prevent and contain the world’s worst Ebola outbreak.
The gold sector faced ongoing headwinds in 2014, and we rose to the challenge by delivering steady gold production of 4.85 million ounces, while lowering our all-in sustaining costs1 by 10 percent compared to 2013. We also improved the value and viability of our portfolio – both by selling non-core assets and by improving the cost and risk profile of our development projects. After 10 years of exploration and engagement, we broke ground on our newest mine, Merian, in partnership with the government of Suriname, which is a 25 percent stakeholder. We also broke through to the full depth of 2,050 feet at our Nevada Turf Vent Shaft.
Although Indonesia export issues were the subject of broad media coverage for much of the year – and ultimately forced us to shut down Batu Hijau for 10 weeks – both the ramp down and startup of our operations were executed safely and efficiently. We are now back up to full capacity and engaging with the new administration to reach our shared goal of maintaining steady operations.
Our people are dedicated to doing things right, and we refreshed our Code of Conduct and streamlined our policies and the way we express our values in 2014 to reflect the culture we want to maintain. I am proud that our employees reported industry leading engagement levels despite difficult decisions to streamline the organization. We have reduced our global workforce by more than 25 percent over the past two years to position Newmont for long-term success, but these reductions did not negatively impact our progress toward improving diversity. Female representation in executive ranks has increased across Newmont and national representation in leadership ranks has improved in Africa and South America.
We worked to improve the way we engage with stakeholders in host countries by doing a better job of listening to their concerns and explaining our business. In Suriname, we signed an agreement with the indigenous Pamakkan people that is aligned with the principles of free, prior and informed consent. In Ghana, the Ahafo Development Foundation was named Africa’s best social impact investment vehicle by the European Union’s African Chamber of Commerce. And in New Zealand, our commitment to community engagement and transparency helped us secure public consent to extend our underground Correnso mine beneath existing neighborhoods. These are great archetypes, but we don’t always get it right. Building strong relationships and mutual understanding with our stakeholders is work that never ends.
Finally, we raised our environmental stewardship standards and practices in 2014. We are partnering with The Nature Conservancy on a Sagebrush Ecosystem Strategy in Nevada to conserve and rehabilitate habitat for a wide range of native species on more than one million acres of Company land. We also strengthened our approach to managing shared resources, like water and energy, and reclaiming land disturbed by mining.
Newmont has an important role to play as a catalyst for sustainable development – and an important commitment to fulfill in minimizing the negative impacts and maximizing the benefits of our operations. I appreciate your interest in our performance, and welcome your feedback.
Gary J. Goldberg
President and Chief Executive Officer
1 All-in sustaining costs is a non-GAAP figure. For reconciliation to GAAP metrics, please see page 75 of our 2014 10-K report.