Good morning, and welcome to the Q3 2018 Earnings Call. All participants will be in listen only After today's presentation, there will be an opportunity to ask questions. Please note this event is being recorded. I would now like to turn the conference over to Jessica Largent, Vice President of Investor Relations. Please go ahead.
Thank you, and good morning, everyone. Welcome to Newmont's Q3 2018 conference call. Joining us on the call today are Gary Goldberg, President and Chief Executive Officer Nancy Bezey, Chief Financial Officer and Tom Palmer, Chief Operating Officer. They will be available to answer questions at the end of the call along with other members of our executive team. Turning to Slide 2.
Before we go further, please take a moment to review the cautionary statements shown here and refer to our SEC filings, which can be found on our website at newmont.com. And now, I'll turn it over to Gary on Slide 3.
Thanks, Jess, and thank you all for joining us this morning. We delivered strong performance for the Q3 and continued to execute our strategy, which includes delivering superior operational execution by running our mines safely and efficiently, sustaining a global portfolio of long life assets by advancing profitable expansions and exploration on 4 continents and leading in profitability and responsibility. Before we get into the details of our 3rd quarter performance, I'd like to take a moment to recognize Tom Palmer and congratulate him on his promotion to President and Chief Operating Officer. I've known Tom for almost 2 decades and have had the pleasure of working with him since 2014 when I recruited him to join the Newmont team. More recently, I recommended to our Board of Directors that Tom be promoted to President based on his performance and experience and as the next logical step in his development.
Tom and his team has skillfully executed the strategy we established over 5 years ago, which was reflected in our results as we continue building the next generation of profitable mines with a focus on capital discipline and industry leading returns. Turning back to the Q3 details on Slide 4. The first pillar of our strategy is to deliver superior operational execution. In the Q3, we produced 1,300,000 ounces of gold at all in sustaining costs of $9.27 per ounce, consistent with our planned back half of the year waiting. We delivered good safety performance and reached our lowest total injury rate for the year as we continue applying lessons learned across the business.
And we also continued to improve costs and efficiency through our full potential program in advancing our 3 most promising digital initiatives including Smart Mine, Connected Worker and Advanced Process Control. These initiatives are critical for us to offset inflation and increasing cost pressures at our operations. The second pillar of our strategy is to sustain a global portfolio of long life assets. During the Q3, in North America, we commissioned the cleaner flotation circuit to complete the CC and V concentrate project. In South America, we placed the 1st tetramain ore on the leach pad in September and mining continues on schedule.
In Australia, we advanced Tanami Expansion II to definitive feasibility study. And in Africa, we started commissioning the Subika Underground project and are on track to achieve commercial production in the Q4. Finally, we continued to plant seeds for the future by forming an exploration partnership with Evrem Resources for the Quale project in Mexico and invested in Miranda Gold and Oros Sur Mining Projects in Colombia. We remain excited about Colombia's prospective gold districts and are working with Continental Gold to support the safe and efficient development of the high grade Baritica project. This also applies to the security of the people around the project, which does not currently meet our expectations.
The 3rd pillar of our strategy is to lead the gold sector in profitability and responsibility. In the 3rd quarter, we declared a dividend of $0.14 per share for the 4th consecutive quarter and we maintained one of the strongest balance sheets in the sector with an investment grade credit rating and $6,000,000,000 of liquidity. Finally, we are recognized as the mining sector leader in the Dow Jones Sustainability Index for an unprecedented 4th year in a row. This performance starts with running safe operations. Turning to Slide 5.
While the Q3 marked our lowest total injury rate for the year, we're not letting up as there's always more work to be done. We remain focused on driving visible, felt leadership by reinforcing key safety systems and behaviors among our employees and contractors, along with the verification of critical controls to prevent fatal injuries. In order to prevent injuries, our team have recorded over 15,000 verifications to critical controls with a completion rate of 99% year to date. As previously mentioned, we're honored to be ranked as the mining industry leader in the Dow Jones Sustainability Index again, highlighting the performance goals we continue to set, including minimizing our environmental impact and partnering to improve the availability of shared resources like water, demonstrating best practices in corporate governance, codes of business conduct and risk and crisis management and investing in community infrastructure and skills development, so we can continue to earn the right to operate and grow. Turning to our cost performance on Slide 6.
Our long term record shows a steady trajectory of improvement, but as expected, our costs rise in 2018 as we execute planned stripping campaigns at Carlin, Twin Creeks, Boddington and Yanacocha. Year to date, costs have decreased to $9.73 per ounce, which is consistent with our second half weighting. And we lowered and narrowed our 2018 AISC outlook to $9.50 to $9.90 per ounce, driven by continued outperformance at Boddington, Acheem and other sites across our portfolio, partially offset by higher costs at Carlin. Turning to production on Slide 7. We produced 1,300,000 ounces of gold on an attributable basis in the 3rd quarter as we reached higher grades in Africa and South America and increased processing of CC and V concentrates in Nevada.
And earlier this month, we poured our millionth ounce of gold at Merion after just 2 years of operation. Due to recent geotechnical events at Carlin, we narrowed our full year production guidance to between $4,900,000 $5,200,000 attributable ounces. Tom will cover this update in more detail later. Overall, we remain on track to achieve our highest production in the Q4 on the back of planned higher grades at Leeville, Yanacocha and Ahafo. Turning to our current projects on Slide 8.
In the Q3, we delivered 2 profitable projects in North America with Twin Creeks Underground and Northwest Exodus. Both of these projects extend mine life and add lower cost production. And we are currently executing 4 projects that will be completed before the end of 2019. In Africa, we remain on track at Subika Underground, which will add higher grade, lower cost production and work at the Ahafo Mill expansion has ramped up and we expect to reach commercial production in the second half of 2019. In South America, we're extending oxide production with Quecher Main and we replaced 1st ore in September.
This project serves as a bridge to developing Yanacocha's extensive sulfide deposits in the years ahead. And finally, in Australia, we're making good progress on the Tanami power project, which will lower costs and emissions and facilitate future growth. These projects will generate an average internal rate of return above 20%. Turning to Slide 9. Our ability to pursue growth on 4 continents is a distinct competitive advantage.
In North America, we continue to pursue underground expansions at Carlin and are progressing pre feasibility studies for Long Canyon Phase 2. And we've begun scoping the Galore Creek pre feasibility studies with Tech Resources. Finally, we recently partnered with Evren Resources to advance the exploration of Qualia, a prospective gold project in Mexico. In South America, we continue to see favorable drilling and process test results at the Anacocha Sulfides and Chacocha Oxides projects in Peru. And as I previously mentioned, we are working with Continental Gold to support development of the Baritica project.
We're also pursuing a range of other promising exploration prospects in Colombia, Chile, Suriname and French Guiana, where we've recently begun drilling at the Esperance site shown in this picture. In Africa, we're advancing studies of underground deposits of Ahafo and Achim and continue to progress the Ahafo North project. And we're working with a local partner, Ezana, to explore greenfields opportunities in Ethiopia. Finally, in Australia, we've advanced our second expansion at Tanami, which Tom will touch on further and continue to explore greenfield targets across the continent. With that, I'll turn it over to Nancy on Slide 10 to discuss our Q3 financial results.
Thanks, Gary. Turning to Slide 11 for the highlights. I am pleased to report good financial results despite gold price decreasing over 7% compared to the prior year quarter. This quarter we delivered revenue of more than $1,700,000,000 adjusted net income of $175,000,000 or $0.33 per diluted share and adjusted EBITDA of $636,000,000 Cash from continuing operations was $428,000,000 compared to $489,000,000 in the prior year quarter, primarily due to lower metal prices and unfavorable changes in working capital. Turning to Slide 12 to review our earnings per share in more detail.
For the 3rd quarter, we recorded a loss in our GAAP net income from continuing $0.31 per diluted share, primarily due to the impairment of long lived assets at exploration properties in immigrant in North America. As shown on the slide, these impairments were adjusted for a total of $0.74 per diluted share. Other adjustments for the quarter included dollars related to valuation allowances and other tax impacts and $0.04 related to a change in the fair value of our marketable equity securities and gains on asset and investment sales. Taking these adjustments into account, we delivered adjusted net income of $0.33 per diluted share. Turning to capital priorities on Slide 13.
Newmont continues to have one of the strongest balance sheets in the gold sector with liquidity of $6,000,000,000 and a net debt to adjusted EBITDA ratio of 0.4x and we remain well positioned to execute on our capital priorities, including maintaining an investment grade credit profile, investing in the next generation of Newmont operations to improve mine life and build a stronger reserve base, and returning cash to shareholders. Yesterday, we declared a dividend of $0.14 per share for the 4th consecutive quarter. We are on track to return nearly $400,000,000 to shareholders in 2018 through dividends and our share buyback program, which aims to maintain a constant share count. We also continue to support increased financial transparency in the gold sector. Over the last several months, we have led a working group with the World Gold Council and our peers to provide greater clarity and consistency for all in sustaining cost reporting.
The council expects to issue an updated AISC guidance note next month with the January 1, 2019 effective date. For Newmont, the proposed changes are expected to lower our AISC due to the exclusion and reclassification of non sustaining costs related to activities such as exploration, advanced projects and R and D. Historically, we've taken a more conservative approach when reporting AISC and we believe the changes will make our cost basis more comparable to our gold industry peers. We will provide additional details on these changes and reconcile to our past methodology when we issue our 2019 guidance on December 5. And now I'll hand it to Tom for a discussion of our operations starting on Slide 14.
Thanks, Nancy. Turning to Slide 15. Year to date, our North American operations have produced more than 1,400,000 ounces of gold at all in sustaining costs under $1,000 per ounce. For the Q3, Carlin delivered solid performance as production increased following the planned Mill 6 shut maintenance shut in Q2. And we started to see higher grades as expected from our underground mines.
At our surface mines, we continue to actively monitor and manage geotechnical risks. At Silver Star, our work continues to remediate the 2016 slip and we still plan to access higher grade ore in the 4th quarter. However, after experiencing further wall movement during the Q3, we have stepped out to manage this issue. As a consequence, we are targeting a smaller mining footprint in this pit. In early October, we also experienced a wall slip at our Gold Quarry pit.
The detection measures we put in place identified movement prior to the event and no one was injured. Mining in this pit is currently suspended and our teams are working through an assessment of mine plans and next steps to safely restart mining. As a result of these challenges, we lowered Carlin's 20 18 production outlook and now expect the North America region to produce approximately 1,900,000 to 2,100,000 ounces. As Gary mentioned, at CCMV, we completed the concentrate project. The cleaner flotation circuit is performing to design, and we are ramping up concentrate deliveries to Nevada.
We expect a strong finish to the year as we continue to draw down stockpiled concentrates and process them through Carlin's Mill 6. Twin Creeks delivered improved costs and grade following the completion of Twin Underground in July. And at Long Canyon, Phase 2 studies continue to advance, as do our near mine exploration programs assessing the next wave of expansion across the region. Turning to South America on Slide 16. As Gary mentioned, earlier this month, after just 2 years in operation, Merian poured its £1,000,000.
I'm tremendously proud of the team for safely achieving this milestone. In the Q3, Merian delivered solid results through continued mine and mill productivity improvements. We declared the primary crusher ready for intended use in early September. This new crusher will help sustain mill throughput and enable the processing of fresh rock beginning early next year. We also expect productivity at Merriam to increase over time with the recent addition of 4 new haul trucks, combined with the ongoing improvements for our full potential program.
At Yanacocha, we reached higher grade ore in the Tapado Estate pit and continue to see the benefits from our optimized mill blending strategy. Quecher Main stripping is ramping up and we placed 1st ore on an existing leach pad in September as construction of the new leach pad continues. Studies at Chakiquocha Oxides continue to advance with drift development to the north and south completed, serving as a platform for the exploration drilling we have underway. For Yanacocha Sulfides, we plan to extend our feasibility study work by a few months to allow us to optimize our tailings storage strategy and complete the associated engineering. We now expect to complete the feasibility study in the first half of 2019 and make a full funds decision in 2020.
Turning to Australia on Slide 17. At Tanami, we delivered strong 3rd quarter performance with high grades and sustained improvements in mill throughput. The Tanami power project continues on course. Construction activities at the power stations are ongoing and the gas pipeline trenching and welding is progressing ahead of schedule. We expect to deliver this project in the Q1 of 2019.
At Boddington, our optimized mill maintenance strategy has helped improve both productivity and costs, and we now expect a lower 2018 all in sustaining cost of between $8.80 $9.30 per ounce. Our planned stripping campaign will ramp up through the remainder of this year and continue through 2019. At KCGM, we continue to manage the impact from wall slips earlier this year. Mining rates have been reduced. However, we continue to mine and process ore from the Superpit and Mount Charlotte underground, supplemented with stockpiled ore.
During the quarter, we finalized the insurance claim of $25,000,000 for our share of lost profits. Considerable work is also underway to assess the longer term impacts, and we expect to provide more information in early December. Looking to the future, we recently advanced Tanami Expansion 2 to DEFINITY feasibility study and anticipate reaching an investment decision in the second half of twenty nineteen, followed by a 3 year construction period. For an investment of approximately $650,000,000 to $750,000,000 this project is expected to add an incremental 100,000 ounces of annual production from 2023 through 2027. The project is not included in our current guidance.
Turning to Africa on Slide 18. Africa again delivered solid results on the back of higher grades and strong mill performance. At Achim, continued outperformance allowed us to lower our 2018 all in sustaining costs for the Africa region to $8.20 to $8.60 per ounce. Looking ahead at Ahafo, commissioning is underway on the Subika underground surface infrastructure and the project continues to progress on schedule to reach commercial production in the Q4 of this year. The project is expected to add 150,000 to 200,000 ounces of higher grade lower cost production annually over the next 5 years.
Construction activities at the Ahafo Mill expansion resumed in August, and the team is making good progress on civil works at both the SAG Mill and Primary crusher. During the Q4, we expect to complete the installation of the new pebble crusher and CIL tanks. We remain on track to achieve commercial production during second half of twenty nineteen. Finally, we continue to advance our regional growth studies focused on developing underground resources at both Ahafo and Achim as well as a potential new mine at Ahafo North. Now I'll hand it back to Gary on Slide 19.
Thank you, Tom. Turning to Slide 20, Newmont is anchored in 4 regions where we have the the stability and operating model that we need to create value over the long term. We began transforming our business 6 years ago and I remain very proud of the team for the work done to set our business up for success over the long term by optimizing the portfolio through the monetization of non core assets, advancing profitable growth on all continents, adding more than 2,000,000 ounces of gold production at all in sustaining costs of about $7.50 per ounce, investing in exploration across the cycle to support a stable production profile with approximately 70% of production and reserves located in the United States and Australia and restoring our balance sheet to provide us the financial flexibility to invest in our most promising projects and prospects. All of these attributes give us the optionality and the ability to stay disciplined in how we pursue value creation and generate returns for shareholders. Our portfolio is also differentiated by a robust project pipeline.
Turning to Slide 21. Our pipeline is among the best in the gold sector in terms of depth and capital efficiency and it gives us the means to maintain steady production while growing margins and reserves. Projects included in our outlook are the current and sustaining capital projects you see here. Subika Underground and Ahafo Mill Expansion in Ghana, Morrison and the Tanami Power Project in Australia and Quecher Main in Peru. Two midterm projects that will improve our outlook are Ahafo North and the recently advanced Tanami Expansion 2, both shown here in green.
We expect to reach a decision to fund these projects in the second half of twenty nineteen. Finally, we continue to invest in progressing our longer term projects shown in dark blue. This pipeline lays the foundation for steady long term production and profitability. Turning to Slide 22. This gives you a feel for our production profile for the next 7 years.
Annual gold production is forecast to remain at around 5,000,000 attributable ounces and our share of global mine production is projected to grow over that same time period. This profile includes production from existing operations as well as both mid term projects, which are not included in our guidance. Both midterm projects which are not included in our guidance. And the dark blue layer shows the Anacocha Sulfides, a longer term feasibility project representing further upside. Overall, Newmont's stable asset base and robust project pipeline represent a distinct competitive advantage.
Putting it all together on Slide 23, we delivered strong 3rd quarter performance and are laying the groundwork for an even stronger future. We'll continue to execute our long term strategy, which is to deliver steady gold production safely and at competitive costs over a longer time horizon, invest in the next generation of mines, technology and leaders across our business, and to lead the gold sector in terms of the value we create and the standards we uphold. Thank you for your time. And with that, I'll turn it over to the operator to open the line for questions.
Thank you. We will now begin the question and answer Our first question today will come from John Bridges of JPMorgan. Please go ahead.
Good morning, Gary, everybody. Thanks for taking the question. You've been working on Sebeka for a long time. So I'm guessing that thing is predeveloped. I'm just wondering if you could surprise us in Q4 with a lot of production coming out of there.
When do you expect that ore to start coming out? And what are the constraints on pulling that tonnage at this point?
Good morning, John. I'm going to hand over to Tom to address that question. Good morning, John. What you're going
to see in the Q4 is a combination of a couple things both associated with Subika. So we're currently mining in the Subika open pit as well and we'll move into higher grade ore in the Phase 3 layback at Subika. So you're going to see the contribution of some higher grade ore from Subika open pit coming in our 4th quarter numbers. Then what happens with Subika Underground, we have been mining from there all year. But as we commission the fans, the ventilation fans and the refrigeration plant, it allows more air into the underground mine and allows us to increase our mining rate.
So you'll see some more tonnes coming out of the mine and the better grades that you get from Subika. So in the Q4 for Ahafo, combination of 2 things, both surface and underground, both associated with Sibica, they're going to contribute to 4th quarter performance.
We sort of talk to the 3rd person here, but we're in the 4th quarter already. So is that equipment in place?
Well, the equipment is absolutely in place. It's got electricity on it and we're busily working on getting to a point where we will reach commercial production this quarter.
Okay. Okay. And then perhaps a bigger picture question with the pit problems in Carlin, the whole industry is facing mature pits. And you've got Subika coming on and the underground projects in Africa, Tanami and your share of Turquoise Ridge. So to what extent are you positioned to switch to a bigger underground, less influenced by material pit configuration over the next few years?
John, I think when you look at our production today, we're roughly 25 percent of our production is coming from underground. We expect over the next 10 years to see that number rise quite a bit. And I think we've got some really qualified folks running those underground operations and really ultimately what will be in all four regions that we operate in at the end of the day. So I think we're well positioned to continue to make that switch. As you know, at the end of the day, it's still based on the ore bodies and those characteristics.
And I think we're well positioned to address both surface and underground opportunities in the future.
Okay, cool. Okay, well done guys. Thanks a lot.
Thanks, John.
Our next question will come from David Haughton of CIBC. Please go ahead.
Good morning, Gary, Tom and Nancy. Maybe my first question is to the newly appointed President looking at Sebeka again. I got to say that I was pretty surprised at the underground mining rate, which is about 1.5 1,000,000 tonnes per annum that we saw in the last quarter. Just wondering what your expectation is going forward? That seemed quite a bit higher than what I previously anticipated.
Thanks, David. Tom here. Yes, you're going to see our mine sequencing in the Q3 allowed us to get rates pretty similar to what we'll see when we've got the full ventilation on. So you'll see roughly those rates going forward that you saw in the Q3. What you are going to see though as we get the air to different parts of the mine is our ability to access higher grade stopes.
Okay. People
are tonnes better grade.
All right. So I was previously assuming something like 1.2 1,000,000 tonnes per annum, but you're feeling comfortable at the 1.5,000,000 by the sounds of it. So I'll just make
that little tweak. I'd keep it in that range.
Okay. Not get too aggressive, okay? You're talking me down.
Yes. Well done.
Okay. Over to Merian, also a higher mining rate than what I'd anticipated as well. And wondering what we should be thinking going forward. Were you just in softer ore there and that helped you out? Or how should I be thinking about it?
Yes, we are you could think about Merian in terms of wet season impacts. So as we come into the dry times of the year, which we saw some of in the Q3, we'll get some higher rates. We are seeing the impact of the 4 additional trucks coming in. So you will see some higher mining rates as a result of the additional fleet. But the rates you're seeing in the Q3 is pretty consistent with what you might see going forward.
And then we'll at various times in the Merian mine sequence, we will reach some higher grades. And that's one of our 4th quarter weightings for this year is in the Maraba pit, we will move into some higher grade ore.
Okay. And in the Q3, there was more mining than processing, so you're adding to the stockpile. Is that part of your strategy? Because previously, you've kind of mined what you milled. Are you looking at building a stockpile going forward?
You will see increased waste movement, and you will see us mining more ore and stockpiling it as we keep the mill fed.
Okay. Last one at Phoenix, there was more production than sales. Will we see a catch up in the Q4? Is it just a matter of timing of shipments?
Exactly right, David. That's timing of concentrate shipments of Fenix.
Okay. All right. Thank you very much. I'll leave it there.
Thank you.
Our next question will come from Chris Terry of Deutsche Bank. Please go
ahead. Hi, Gary, Nancy and Tom. A few questions from me. I just wanted, Tom, Tom, if you could go into a little bit more detail on the geotechnical issues at Karl and maybe step through the timeline on how you're seeing that progressing and when you'll be able to make more decisions going forward on that? That's my first question.
Thanks, Chris. Maybe to step through the 2 pits. So Silver Star is in the north part of Carlin and Gold Quarry is in the south part. So they're a good 20 miles apart across that Carlin complex. In Silver Star, the work we've done through the Q3 to step out and manage some of the activity we saw through the Q3, that's all in good shape.
We're in ore and we'll be mining there from now until the end of Q1 and that really sees the end of the Silver Star pit. And there's the order of about 160,000 ounces to come out of there. So that's factored into our guidance for the remaining part of this year. Gold Quarry, the area that slipped, it says, as I think John said, it is a mature pit. And the area that slipped was some alluvial material at the very top of that pit, so a wall that had been sitting for quite some time.
So we've got some work to do to step through and understand the mechanisms for what happened there and then develop a remediation plan to get back in and accessing ore out of Gold Quarry. A lot of the work in Gold Quarry for the short to medium term is actually stripping. And Gold Quarry is one of for the Carlin complex, Gold Quarry is 1 of 5 open pits that we're mining, multiple underground mines and then multiple stockpile sources. So the overall impact of Gold Quarry, put it in perspective, year to date Gold Quarry has contributed about 100,000 ounces of Carla's production. So it's there are a number of other things we can do to source ore for the processing plants at Carla mostly work through how to best remediate that section of the gold quarry pit.
Okay. Thanks, Tom. That's helpful. Just in terms of the overall environment, I think I've asked this question maybe 6 months or so ago and just wanted to get an update on it. And maybe it's for you as well, Tom.
Just on the consumable side and the general cost environment, how are you seeing that from labor, pressure from diesel, etcetera, just as we head into 2019? Thanks.
We're certainly seeing some increase in costs from diesel globally, which I think everyone's experiencing. We do get with some reasonable production coming out of Australia, we do get some offset from the Australian dollar helping in that space. Other consumables, we're monitoring. We are certainly seeing pressure in those. That's where our full potential program comes into play, and we look to offset those escalations with our full potential improvements as a minimum.
From a labor perspective, most parts of the world, we're seeing pretty stable labor costs and attrition rates. Probably in Australia, just starting to see with the market in Western Australia, in particular, heating up with the iron ore players, a little bit more attrition and an area that we're keeping an eye on that may put some pressure on labor rates into next year. So that's a particular area we're keeping an eye on.
Okay. Okay. Thanks, Tom. My last one is just for Nancy. In terms of the cash balance, it's still above the $3,000,000,000 Can you just give us an update there on the ability to reduce the cash rates?
I know that there's obviously some restrictions in South America, etcetera, but maybe you can just talk through where you see that trending over time?
Sure. We think about our cash balance as a real benefit and a differentiator for the company. And as we continue to generate free cash flow, we will use those dollars both generative and what's on the balance sheet to fund our business going forward. That will mean investment in the business through CapEx. We've enhanced our exploration dollar spend this year and we're also providing more cash back to shareholders in the form of the share buyback to cover dilution and enhance dividends.
So all of those kinds of things will allow us to continue to invest in our business and also give us a lot of flexibility for opportunistic M and A, a la things like CC and V done in a lower gold price environment. So we want to continue to have those levers. The other piece as of today, we have that flexibility to pay back our notes that come due in both 2019 2022 and we'll use some of the cash proceeds for those repayments, but another lever we can pull. So we enjoy that cash to have ultimate financial flexibility for the company as we pave the way for the next few decades.
Okay. Thanks for the color. Yes, I mean, I was referring specifically to the size of the cash balances. Obviously, it's quite a large number for the company just in terms of looking at the net debt, I guess, overall. I was more meaning around the South America and then the restrictions on getting some of the cash out and some of the more details around the specifics on the cash balance.
Sure. Yes, we have cash in jurisdictions where we want to continue to invest in our business. So for example, in South America, as you think about the capital requirements coming up over the next few years for projects like sulfides and some other projects, we want to maintain cash balances in country. So we don't have any restrictions today in terms of repatriating cash to the U. S, but have chosen very purposefully to keep the cash in certain jurisdictions.
So we're comfortable with that balance and we're comfortable with the complement of the countries in which it's allocated today.
Okay. Thanks. Thanks, Nancy. That's all from me. Thanks.
Thanks, Chris.
Our next question will come from Tanya Jakusconek of Scotiabank. Please go ahead.
Yes. Good morning, everybody. I just have a technical question. Good morning, Gary. Of course, I can't leave you without a technical question.
So I'm coming back to Gold Quarry. I just wanted to have an idea of the without seeing a photo or looking at the size of the slide, how much ore are we impacting?
Yes, Tom.
Yes, Tom, sorry.
Sorry, Tanya, did you have something else you wanted to
add? Yes. I just wanted to know the slides, the pit wall failure at Gold Quarry. How much or have we impacted with that slide?
So it's the impact has been in terms of an area that we were planning to mine on the opposite side of the pit. That's not affected by the slide. It's more about what we need to do to remediate the slide before we can access that ore on the opposite side of the pit. So that's part of the remediation step. Then that area that slipped would be part of a future layback where we'd actually take that material down to get to ore into a future layback on that side of the mine.
So it's not sitting on top of ore per se. It's more about in some instances, it's helped in terms of laying itself back. But we need to think about how we start to go through and remediate that area.
Okay. So it's okay. So nothing has been sterilized or anything like that. It's just a matter of having to remove it. And as you said, it's helped a little bit on the layback that would have otherwise had to be laid
back? That's right. Picture the Carlin formation or alluvial material at the very top of the mine flowing down into the pit and it's a matter of cleaning that up now.
Okay. Do you know how many tonnes are sitting in the bottom of the pit of the slide just as a size wise, so?
It's sort of a couple of 1,000,000 tonnes of spread from the imagine it's a mature mine, so it's a deep pit. So I imagine that spread over quite a distance.
It's a couple of 1,000,000 tonnes. Okay. Thank you. Thanks, Tanya.
Our next question will come from Lucas Pipes of B. Riley FBR. Please go ahead.
Hey, good morning everyone and thank you for taking my question. Most of my questions have been answered, but I wanted to follow-up a little bit about the comments regarding the succession planning from the prepared remarks. Gary, if you could maybe elaborate on your thoughts on that. And obviously, you've had a great tenure and just wanted to hear kind of what some more background on sharing that language. Thank you.
Sure thing, Lucas. I think as we're in the prepared remarks, I've known Tom for almost 2 decades and brought him in. We gave him the challenge of Indonesia right off the bat. So he's been fire tested in terms of some pretty challenging situations as we went through export permit issues and ultimately a divestment there. Tom then moved over to the APAC region and ran that quite well in the operations there.
We ended up divesting Waihi during his term there and also divesting about to Hijao. And two and a half years ago, Tom was promoted into the COO role and Tom and his team have really been core to delivering our strategy over the last two and a half years and working with the Board on plans for succession and plans for his development, it made sense at this stage to take this next step in naming him as President and COO.
Got it. Okay. Well, that's helpful color. I appreciate that and best of luck.
Thanks, Lucas.
Our next question will come from Michael Dudas of Vertical Research. Please go ahead.
Good morning, everybody. Gary, as you look out to 2019, I'm sure we're going to get a lot more details in December. But given where gold prices are and have come down over the past several months and looking at your several opportunities for investment for the pipeline, are you concerned about what timing and capital outflows and how you want to develop these projects, especially given your capacity to develop with your internal team as you look forward to these like medium term opportunities before we move on to the larger and more expansive ones like that in Latin America?
Michael, it's a great question. And I think we always have gotten the question, can you move these things faster? And I've stressed the point that we want to make sure we do the study work along the way. We happen to have 4 projects coming along in the later part of 2019, you know, 1st part of 2020. In some ways, it gives us leverage depending on where gold price is.
Keep in mind, we do our plans at a base at $1200 an ounce and we have our hurdle rates and at this stage, these all look to be good projects that would add value to our shareholders to move forward. But your point in regards to at least they're going on in different regions, so that's a positive. In terms of how we manage them, when we bring them on, that's one of the things we do consider as we make the decisions to move forward and we of course would want to move forward with the best projects first. But I think we sit in a really good spot and we have flexibility depending on where gold prices go. And as you heard from Nancy, we do have the ability to fund those projects going forward.
And that's very helpful, Gary. And following up on your you had some prepared remarks about Colombia. Maybe you can share with us since the issues that occurred last month, what Newmont Continental have done and any changes or thought process relative to getting a little bit more stable down there before you start moving much more quicker into that relationship?
I think 2 key areas, 1 working with Continental to better understand what happened and what actions need to be taken to make sure people are protected. So that's at the forefront in terms of working with them. In regards to our own people that are down there working on exploration at this stage as we work through with Continental and with our own people down there. We are not doing any active exploration on the ground. We're making sure we work with the local authorities and communities to make sure that before we put people down on the ground that they can be properly protected and work safely down there.
So those are the 2 key areas we're focused on.
Thank you, Gary.
Thank you, Mike.
Ladies and gentlemen, this will conclude our question and answer session. I would like to turn the conference back over to Gary Goldberg for closing remarks.
Thank you and thank you all for joining our call this morning and we look forward to providing an updated longer term outlook on our December 5th guidance update. So stay tuned. Thank you.