Newcrest | Welcome to Newcrest's senior executive blog
- Michael Nossal
- Chief Development Officer
The search for our next growth opportunities
You may have noticed that Newcrest has announced a number of exploration partnerships and deals over the last few months.
In total, Fraser MacCorquodale, our GM of Exploration, and his team struck six deals in 2015 – Mungana in Australia, Southern Coromandel in New Zealand, Taruga and Apollo in Côte d'Ivoire, Oro Verde in Nicaragua, and in a deal just finalised in December, the purchase of Wamum in the Morobe Province of Papua New Guinea from Barrick.
This bevy of business deals is part of our efforts to build a solid pipeline of early-stage exploration opportunities which have the potential to deliver the company's next generation of mines.
The search for profitable prospects is a numbers game to some degree. On average in the industry, perhaps 1 in 50 exploration sites will progress through to being a profitable proposition to develop. We are hoping the odds will be higher in our case, but nevertheless, the truth remains that you've got to kiss a lot of frogs to find a prince. We can, however, improve the odds by capturing the best opportunities such as we did previously at Cadia, Gosowong and Golpu. This is what our teams are focussed on finding.
It is the ideal time to be canvassing opportunities. Conditions are difficult for many exploration businesses due to lower commodity prices, and many junior companies are finding it hard to raise equity. This works to Newcrest's advantage. Having worked to reduce our debt and improve our free cash flow over the past two years, we are well-positioned to look for early-stage growth opportunities.
For many juniors, seeking an investment partner, Newcrest is truly a Miner of choice. We have a strong track record and considerable capability in finding and developing new gold/copper mines. We have a reputation for delivering on our commitments in terms of delivering the biggest exploration bang for our buck. And we are also at the cutting edge in terms of technology.
Last month, we showcased one of our secret weapons to the Board for mapping the geological material at our exploration sites more quickly and accurately – Corescan. This is a technology developed by a leading Australian technology firm, which is allowing us to more quickly map geological material and detect the 'subtle footprints' of future gold/copper discoveries.
I look forward to sharing more with you over 2016 as we work to leverage Newcrest's competitive strengths in exploration to our advantage over the coming year.
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