Newmont Issues Default Notice Over NGM Diversion, Threatens Barrick’s U.S. Spinoff Stake
Newmont has served Barrick a notice of default over alleged diversion of Nevada Gold Mines resources to Fourmile, triggering a 30-day cure window under their 2019 JV agreement. Barrick, the 61.5% NGM partner, rejects the claims and will sell 10%–15% in a U.S. spinoff including its NGM interest.
1. Default Notice and Allegations
Newmont has formally served Barrick with a notice of default under the 2019 joint-venture agreement for Nevada Gold Mines, alleging that Barrick diverted resources to its wholly owned Fourmile project. The notice triggers a 30-day window for Barrick to remedy the breach or face potential legal proceedings in Nevada court.
2. Barrick’s Response and Ownership Structure
Barrick holds a 61.5% interest in Nevada Gold Mines compared to Newmont’s 38.5% share and has publicly rejected the diversion claims. CEO Mark Hill emphasized the company’s commitment to constructive engagement, but cited confidentiality terms that limit disclosure of joint-venture operations.
3. Spinoff Plans Under Pressure
Barrick plans to spin off its North American assets later this year and offer a 10%–15% stake in the new entity, which will include the NGM interest, Fourmile project and Dominican Republic mine. Tensions over the default notice raise execution risks for the spinoff and could affect investor appetite for the stake sale.
4. Investor Concerns and Performance Risks
Investors and Newmont have flagged operational underperformance at Nevada assets, pointing to output declines and rising costs before an anticipated IPO of the joint venture. Newmont’s 10-K warns that unresolved disputes could materially harm its NGM interest, venture operations and growth strategy tied to Nevada Gold Mines.