NEWMONT Corp /DE/ - Quarter Report: 2017 September (Form 10-Q)

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UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D. C. 20549

Form 10-Q

(Mark One)

☒QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the Quarterly Period Ended September 30, 2017

☐TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from to

Commission File Number: 001-31240

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NEWMONT MINING CORPORATION

(Exact name of registrant as specified in its charter)

Delaware		84-1611629
(State or Other Jurisdiction of Incorporation or Organization)		(I.R.S. Employer Identification No.)

6363 South Fiddler’s Green Circle
Greenwood Village, Colorado		80111
(Address of Principal Executive Offices)		(Zip Code)

Registrant’s telephone number, including area code (303) 863-7414

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. ☒ Yes ☐ No

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files). ☒ Yes ☐ No

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12-b2 of the Exchange Act.

Large accelerated filer	☒		Accelerated filer	☐
Non-accelerated filer	☐	(Do not check if a smaller reporting company.)	Smaller reporting company	☐
			Emerging growth company	☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12-b2 of the Exchange Act). ☐ Yes ☒ No

There were 533,336,470 shares of common stock outstanding on October 19, 2017.

Table of Contents

TABLE OF CONTENTS

		Page
	PART I – FINANCIAL INFORMATION
THIRD QUARTER 2017 RESULTS AND HIGHLIGHTS		1
ITEM 1.	FINANCIAL STATEMENTS	3
	Condensed Consolidated Statements of Operations	3
	Condensed Consolidated Statements of Comprehensive Income (Loss)	4
	Condensed Consolidated Statements of Cash Flows	5
	Condensed Consolidated Balance Sheets	6
	Notes to Condensed Consolidated Financial Statements	7
ITEM 2.	MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS	50
	Overview	50
	Consolidated Financial Results	50
	Results of Consolidated Operations	58
	Foreign Currency Exchange Rates	66
	Liquidity and Capital Resources	67
	Environmental	71
	Accounting Developments	72
	Non-GAAP Financial Measures	72
	Safe Harbor Statement	81
ITEM 3.	QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK	84
ITEM 4.	CONTROLS AND PROCEDURES	86
	PART II – OTHER INFORMATION
ITEM 1.	LEGAL PROCEEDINGS	87
ITEM 1A.	RISK FACTORS	87
ITEM 2.	UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS	87
ITEM 3.	DEFAULTS UPON SENIOR SECURITIES	87
ITEM 4.	MINE SAFETY DISCLOSURES	87
ITEM 5.	OTHER INFORMATION	88
ITEM 6.	EXHIBITS	88
SIGNATURES		89

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NEWMONT MINING CORPORATION

THIRD QUARTER 2017 RESULTS AND HIGHLIGHTS

(unaudited, in millions, except per share, per ounce and per pound)


	Three Months Ended September 30,				Nine Months Ended September 30,
	2017		2016		2017		2016
Financial Results:
Sales	$	1,879	$	1,791	$	5,413	$	4,922
Gold	$	1,799	$	1,728	$	5,186	$	4,751
Copper	$	80	$	63	$	227	$	171
Costs applicable to sales (1)	$	1,053	$	983	$	2,985	$	2,736
Gold	$	1,017	$	918	$	2,866	$	2,571
Copper	$	36	$	65	$	119	$	165
Net income (loss) from continuing operations	$	205	$	135	$	452	$	109
Net income (loss)	$	198	$	(313)	$	407	$	(116)
Net income (loss) from continuing operations attributable to Newmont stockholders	$	213	$	169	$	474	$	171
Per common share, diluted:
Net income (loss) from continuing operations attributable to Newmont stockholders	$	0.39	$	0.32	$	0.88	$	0.32
Net income (loss) attributable to Newmont stockholders	$	0.38	$	(0.67)	$	0.80	$	(0.53)
Adjusted net income (loss) (2)	$	183	$	202	$	564	$	486
Adjusted net income (loss) per share, diluted (2)	$	0.35	$	0.38	$	1.06	$	0.91
Earnings before interest, taxes and depreciation and amortization (2)	$	659	$	622	$	1,920	$	1,768
Adjusted earnings before interest, taxes and depreciation and amortization (2)	$	653	$	666	$	1,917	$	1,736
Net cash provided by (used in) operating activities of continuing operations					$	1,596	$	1,333
Free Cash Flow (2)					$	1,039	$	501
Cash dividends declared per common share	$	0.075	$	0.025	$	0.175	$	0.075

Operating Results:
Consolidated gold ounces (thousands):
Produced		1,441		1,318		4,208		3,810
Sold		1,411		1,300		4,151		3,766
Attributable gold ounces (thousands):
Produced		1,339		1,246		3,925		3,575
Sold		1,312		1,230		3,865		3,534
Consolidated and attributable copper pounds (millions):
Produced		27		32		87		89
Sold		26		30		84		84
Average realized price:
Gold (per ounce)	$	1,276	$	1,329	$	1,250	$	1,261
Copper (per pound)	$	3.06	$	2.04	$	2.71	$	2.03
Consolidated costs applicable to sales: (1)(2)
Gold (per ounce)	$	721	$	706	$	690	$	682
Copper (per pound)	$	1.38	$	2.14	$	1.42	$	1.96
All-in sustaining costs: (2)
Gold (per ounce)	$	943	$	925	$	909	$	910
Copper (per pound)	$	1.65	$	2.57	$	1.70	$	2.30

⁽¹⁾

Excludes Depreciation and amortization and Reclamation and remediation.

⁽²⁾

See “Non-GAAP Financial Measures” beginning on page 72.

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Third Quarter 2017 Highlights

Portfolio improvements: Declared commercial production for the Tanami Expansion Project at the end of August 2017, mined first ore at the Twin Creeks Underground mine in August 2017 and approved the Quecher Main project in October 2017 to extend the mine life at Yanacocha to 2027;

Attributable gold production: Increased 7% from the prior-year quarter to 1.34 million ounces, primarily due to new production from Merian and Long Canyon, partially offset by lower throughput at Twin Creeks and lower grades at Boddington;

Net income (loss): Delivered Net income (loss) from continuing operations attributable to Newmont stockholders of $213 or $0.39 per diluted share, an increase of $44 from the prior-year quarter, primarily due to higher gold production and lower income and mining taxes, partially offset by lower average realized gold prices;

Adjusted net income (loss): Delivered Adjusted net income (loss) of $183 or $0.35 per diluted share, an 8% decrease from the prior-year quarter (See “Non-GAAP Financial Measures” beginning on page 72);

Adjusted EBITDA: Generated $653 in Adjusted EBITDA, a 2% decrease from the prior-year quarter (See “Non-GAAP Financial Measures” beginning on page 72); and

Financial strength: Ended the quarter with $3.0 billion cash on hand and increased the dividend declared for the third quarter of 2017 to $0.075 per share, a 50% increase from the prior-year quarter dividend.

Our global project pipeline

Projects included in our global pipeline comprise an important part of the Company’s growth strategy and reflect opportunities throughout the development cycle. The most advanced projects, including early stage development and projects in or near the execution phase are described below. The exploration, construction and execution of these projects may require significant funding to complete.

Tanami Expansion, Australia. This project included a second decline in the mine and incremental capacity in the plant to increase profitable production and serve as a platform for future growth. The project achieved commercial production at the end of August 2017 and is expected to maintain Tanami’s annual gold production at 425,000 to 475,000 ounces for the first five years of production. Development capital costs (excluding capitalized interest) since approval were $108, of which $8 related to the third quarter of 2017.

Subika Underground, Africa. This project leverages existing infrastructure and an optimized approach to develop Ahafo’s most promising underground resource. First production was achieved in June 2017, with commercial production expected in the second half of 2018. The project is expected to increase average annual gold production by between 150,000 and 200,000 ounces per year for the first five years beginning in 2019 with an initial mine life of approximately 11 years. Development capital costs (excluding capitalized interest) since approval were $44, of which $22 related to the third quarter of 2017.

Ahafo Mill Expansion, Africa. This project is designed to maximize resource value by improving production margins and accelerating stockpile processing. The project also supports profitable development of Ahafo’s highly prospective underground resource. First production is expected in the first half of 2019, with commercial production expected in the second half of 2019. The expansion is expected to increase average annual gold production by between 75,000 and 100,000 ounces per year for the first five years beginning in 2020. Development capital costs (excluding capitalized interest) since approval were $22, of which $13 related to the third quarter of 2017.

Twin Underground, North America. This project is a portal mine beneath Twin Creek’s Vista surface mine with similar mineralization. First production was achieved in August 2017, with commercial production expected in mid-2018. The expansion is expected to average between 30,000 and 40,000 ounces per year between 2018 and 2022. Development capital costs (excluding capitalized interest) since approval were $4, all of which related to the third quarter of 2017.

Quecher Main, South America. The Board of Directors approved the full funding of the Quecher Main project in October 2017. This project will add oxide production at Yanacocha, leverage existing infrastructure and enable potential future growth at Yanacocha. First production is expected in early 2019 with commercial production in the fourth quarter of 2019. Quecher Main extends the life of the Yanacocha operation to 2027 with average annual gold production of about 200,000 ounces per year (on a consolidated basis) between 2020 and 2025.

We manage our wider project portfolio to maintain flexibility to address the development risks associated with our projects including permitting, local community and government support, engineering and procurement availability, technical issues, escalating costs and other associated risks that could adversely impact the timing and costs of certain opportunities.

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PART I—FINANCIAL INFORMATION

ITEM 1.FINANCIAL STATEMENTS.

NEWMONT MINING CORPORATION

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

(unaudited, in millions except per share)


	Three Months Ended September 30,				Nine Months Ended September 30,
	2017		2016		2017		2016
Sales	$	1,879	$	1,791	$	5,413	$	4,922

Costs and expenses:
Costs applicable to sales (1)		1,053		983		2,985		2,736
Depreciation and amortization		327		335		928		892
Reclamation and remediation (Note 5)		29		25		103		67
Exploration		48		39		135		107
Advanced projects, research and development		41		34		99		105
General and administrative		58		63		171		178
Other expense, net (Note 6)		1		21		32		54
		1,557		1,500		4,453		4,139
Other income (expense):
Other income, net (Note 7)		10		(4)		32		93
Interest expense, net		(56)		(64)		(187)		(204)
		(46)		(68)		(155)		(111)
Income (loss) before income and mining tax and other items		276		223		805		672
Income and mining tax benefit (expense) (Note 8)		(72)		(90)		(349)		(555)
Equity income (loss) of affiliates		1		2		(4)		(8)
Net income (loss) from continuing operations		205		135		452		109
Net income (loss) from discontinued operations (Note 3)		(7)		(448)		(45)		(225)
Net income (loss)		198		(313)		407		(116)
Net loss (income) attributable to noncontrolling interests
Continuing operations (Note 9)		8		34		22		62
Discontinued operations (Note 3)		—		(79)		—		(229)
		8		(45)		22		(167)
Net income (loss) attributable to Newmont stockholders	$	206	$	(358)	$	429	$	(283)

Net income (loss) attributable to Newmont stockholders:
Continuing operations	$	213	$	169	$	474	$	171
Discontinued operations		(7)		(527)		(45)		(454)
	$	206	$	(358)	$	429	$	(283)
Net income (loss) per common share (Note 10)
Basic:
Continuing operations	$	0.39	$	0.32	$	0.88	$	0.32
Discontinued operations		(0.01)		(0.99)		(0.08)		(0.85)
	$	0.38	$	(0.67)	$	0.80	$	(0.53)
Diluted:
Continuing operations	$	0.39	$	0.32	$	0.88	$	0.32
Discontinued operations		(0.01)		(0.99)		(0.08)		(0.85)
	$	0.38	$	(0.67)	$	0.80	$	(0.53)

Cash dividends declared per common share	$	0.075	$	0.025	$	0.175	$	0.075

⁽¹⁾

Excludes Depreciation and amortization and Reclamation and remediation.

The accompanying notes are an integral part of the Condensed Consolidated Financial Statements.

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NEWMONT MINING CORPORATION

CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS)

(unaudited, in millions)


	Three Months Ended September 30,				Nine Months Ended September 30,
	2017		2016		2017		2016
Net income (loss)	$	198	$	(313)	$	407	$	(116)
Other comprehensive income (loss):
Change in marketable securities, net of $-, $-, $- and $- tax benefit (expense), respectively		5		19		(6)		(37)
Foreign currency translation adjustments		8		3		12		10
Change in pension and other post-retirement benefits, net of $(2), $(1), $(7) and $(3), tax benefit (expense), respectively		4		1		13		8
Change in fair value of cash flow hedge instruments, net of $(4), $(4), $(11) and $(19) tax benefit (expense), respectively		9		16		23		51
Other comprehensive income (loss)		26		39		42		32
Comprehensive income (loss)	$	224	$	(274)	$	449	$	(84)

Comprehensive income (loss) attributable to:
Newmont stockholders	$	232	$	(319)	$	471	$	(251)
Noncontrolling interests		(8)		45		(22)		167
	$	224	$	(274)	$	449	$	(84)

The accompanying notes are an integral part of the Condensed Consolidated Financial Statements.

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NEWMONT MINING CORPORATION

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(unaudited, in millions)


	Nine Months Ended September 30,
	2017		2016
Operating activities:
Net income (loss)	$	407	$	(116)
Adjustments:
Depreciation and amortization		928		892
Stock-based compensation (Note 12)		53		54
Reclamation and remediation		97		60
Loss (income) from discontinued operations (Note 3)		45		225
Deferred income taxes		97		456
Gain on asset and investment sales, net		(21)		(109)
Write-downs of inventory and stockpiles and ore on leach pads		158		207
Other operating adjustments		74		90
Net change in operating assets and liabilities (Note 22)		(242)		(426)
Net cash provided by (used in) operating activities of continuing operations		1,596		1,333
Net cash provided by (used in) operating activities of discontinued operations (1)		(12)		826
Net cash provided by (used in) operating activities		1,584		2,159
Investing activities:
Additions to property, plant and mine development		(557)		(832)
Purchases of investments		(113)		—
Proceeds from sales of investments		34		184
Other		9		(13)
Net cash provided by (used in) investing activities of continuing operations		(627)		(661)
Net cash provided by (used in) investing activities of discontinued operations		—		(41)
Net cash provided by (used in) investing activities		(627)		(702)
Financing activities:
Repayment of debt		(579)		(777)
Distributions to noncontrolling interests		(119)		—
Dividends paid to common stockholders		(94)		(41)
Funding from noncontrolling interests		70		58
Payments for withholding of employee taxes related to stock-based compensation		(13)		(6)
Dividends paid to noncontrolling interests		—		(146)
Acquisition of noncontrolling interests		—		(19)
Other		(13)		(1)
Net cash provided by (used in) financing activities of continuing operations		(748)		(932)
Net cash provided by (used in) financing activities of discontinued operations		—		(319)
Net cash provided by (used in) financing activities		(748)		(1,251)
Effect of exchange rate changes on cash		4		4
Net change in cash and cash equivalents		213		210
Less net cash provided by (used in) Batu Hijau discontinued operations		—		474
		213		(264)
Cash and cash equivalents at beginning of period		2,756		2,363
Cash and cash equivalents at end of period	$	2,969	$	2,099

⁽¹⁾

Net cash provided by (used in) operating activities of discontinued operations includes $(3) related to closing costs for the sale of Batu Hijau that were paid in 2017 and $(9) and $(8) related to the Holt royalty obligation, all of which were paid out of cash and cash equivalents held for use for the nine months ended September 30, 2017 and 2016, respectively. For additional information regarding our discontinued operations, including cash flows from Batu Hijau, see Note 3.

The accompanying notes are an integral part of the Condensed Consolidated Financial Statements.

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NEWMONT MINING CORPORATION

CONDENSED CONSOLIDATED BALANCE SHEETS

(unaudited, in millions)


	At September 30,		At December 31,
	2017		2016
ASSETS
Cash and cash equivalents	$	2,969	$	2,756
Trade receivables		131		160
Other accounts receivables		116		183
Investments (Note 15)		76		56
Inventories (Note 16)		692		617
Stockpiles and ore on leach pads (Note 17)		714		763
Other current assets		110		142
Current assets		4,808		4,677
Property, plant and mine development, net		12,173		12,485
Investments (Note 15)		292		227
Stockpiles and ore on leach pads (Note 17)		1,796		1,864
Deferred income tax assets		1,288		1,331
Other non-current assets		479		447
Total assets	$	20,836	$	21,031

LIABILITIES
Debt (Note 18)	$	4	$	566
Accounts payable		315		320
Employee-related benefits		258		304
Income and mining taxes payable		195		153
Other current liabilities (Note 19)		378		407
Current liabilities		1,150		1,750
Debt (Note 18)		4,046		4,049
Reclamation and remediation liabilities (Note 5)		2,066		2,029
Deferred income tax liabilities		606		592
Employee-related benefits		380		411
Other non-current liabilities (Note 19)		357		326
Total liabilities		8,605		9,157

EQUITY
Common stock		853		849
Additional paid-in capital		9,526		9,490
Accumulated other comprehensive income (loss) (Note 21)		(292)		(334)
Retained earnings		1,051		716
Newmont stockholders' equity		11,138		10,721
Noncontrolling interests		1,093		1,153
Total equity		12,231		11,874
Total liabilities and equity	$	20,836	$	21,031

The accompanying notes are an integral part of the Condensed Consolidated Financial Statements.

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NEWMONT MINING CORPORATION

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)

(dollars in millions, except per share, per ounce and per pound amounts)

NOTE 1 BASIS OF PRESENTATION

The interim Condensed Consolidated Financial Statements (“interim statements”) of Newmont Mining Corporation and its subsidiaries (collectively, “Newmont” or the “Company”) are unaudited. In the opinion of management, all adjustments (including normal recurring adjustments) and disclosures necessary for a fair presentation of these interim statements have been included. The results reported in these interim statements are not necessarily indicative of the results that may be reported for the entire year. These interim statements should be read in conjunction with Newmont’s Consolidated Financial Statements for the year ended December 31, 2016 filed on February 21, 2017 on Form 10-K. The year-end balance sheet data was derived from the audited financial statements and, in accordance with the instructions to Form 10-Q, certain information and footnote disclosures required by United States (“U.S.”) generally accepted accounting principles (“GAAP”) have been condensed or omitted. References to “A$” refers to Australian currency and “C$” refers to Canadian currency.

On November 2, 2016, Newmont completed the sale of its 48.5% economic interest in PT Newmont Nusa Tenggara (“PTNNT”), which operated the Batu Hijau copper and gold mine (“Batu Hijau”) in Indonesia (the “Batu Hijau Transaction”). As a result, Newmont presents Batu Hijau as a discontinued operation for all periods presented. Accordingly, (i) our Condensed Consolidated Statements of Operations and Cash Flows have been reclassified to present Batu Hijau as a discontinued operation for all periods presented and (ii) the amounts presented in these notes relate only to our continuing operations, unless otherwise noted. For additional information regarding our discontinued operations, see Note 3.

The Company has reclassified $33 from Other accounts receivables to Trade receivables as of December 31, 2016 to conform to the 2017 presentation.

NOTE 2 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Risks and Uncertainties

As a global mining company, the Company’s revenue, profitability and future rate of growth are substantially dependent on prevailing prices for gold and copper. Historically, the commodity markets have been very volatile, and there can be no assurance that commodity prices will not be subject to wide fluctuations in the future. A substantial or extended decline in commodity prices could have a material adverse effect on the Company’s financial position, results of operations, cash flows, access to capital and on the quantities of reserves that the Company can economically produce. The carrying value of the Company’s Property, plant and mine development, net; Inventories; Stockpiles and ore on leach pads and Deferred income tax assets are particularly sensitive to the outlook for commodity prices. A decline in the Company’s price outlook from current levels could result in material impairment charges related to these assets.

The preparation of financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the accounting for and recognition and disclosure of assets, liabilities, equity, revenues and expenses. The Company must make these estimates and assumptions because certain information used is dependent on future events, cannot be calculated with a high degree of precision from data available or simply cannot be readily calculated based on generally accepted methodologies. Actual results could differ from these estimates.

Recently Adopted Accounting Pronouncements

Inventory

In July 2015, Accounting Standard Update (“ASU”) No. 2015-11 was issued related to inventory, simplifying the subsequent measurement of inventories by replacing the lower of cost or market test with a lower of cost and net

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NEWMONT MINING CORPORATION

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)

(dollars in millions, except per share, per ounce and per pound amounts)

realizable value test. The update is effective in fiscal years, including interim periods, beginning after December 15, 2016. The Company records inventory at the lower of cost or net realizable value and the adoption of this guidance, effective January 1, 2017, had no impact on the Consolidated Financial Statements or disclosures.

Stock-based compensation

In March 2016, ASU No. 2016-09 was issued related to stock-based compensation. The new guidance simplifies the accounting for stock-based compensation transactions, including income tax consequences, classification of awards as either equity or liabilities and classification of cash payments related to tax withholdings on behalf of employees on the Consolidated Statements of Cash Flows. This update is effective in fiscal years, including interim periods, beginning after December 15, 2016. The Company adopted this guidance as of January 1, 2017, and reclassified $(6) from Net cash provided by (used in) operating activities of continuing operations to Net cash provided by (used in) financing activities of continuing operations for the nine months ended September 30, 2016. Adoption of this guidance had no other impact on the Consolidated Financial Statements or disclosures.

Business Combinations

In January 2017, ASU No. 2017-01 was issued clarifying the definition of a business and providing additional guidance for determining whether transactions should be accounted for as acquisitions of assets or businesses. This update is effective in fiscal years, including interim periods, beginning after December 15, 2017, and early adoption is permitted. The new guidance is required to be applied on a prospective basis. Adoption of this guidance, effective April 1, 2017, had no impact on the Consolidated Financial Statements or disclosures.

Goodwill

In January 2017, ASU No. 2017-04 was issued, which removes step two from the goodwill impairment test. As a result, an entity should perform its annual goodwill impairment test by comparing the fair value of a reporting unit with its carrying amount and should recognize an impairment charge for the amount by which the carrying amount exceeds the reporting unit’s fair value. This update is effective in fiscal years, including interim periods, beginning after December 15, 2019, and early adoption is permitted. Adoption of this guidance, effective April 1, 2017, had no impact on the Consolidated Financial Statements or disclosures.

Recently Issued Accounting Pronouncements

Revenue recognition

In May 2014, ASU No. 2014-09 was issued related to revenue from contracts with customers. This ASU was further amended in August 2015, March 2016, April 2016, May 2016, December 2016, and September 2017 by ASU No. 2015-14, No. 2016-08, No. 2016-10, No. 2016-12, No. 2016-20 and No. 2017-13, respectively. The new guidance provides a five-step approach to be applied to all contracts with customers and also requires expanded disclosures about revenue recognition. In August 2015, the effective date was deferred to reporting periods, including interim periods, beginning after December 15, 2017, and will be applied retrospectively.

The Company has performed an assessment of the revised guidance and the impacts on the Company’s Consolidated Financial Statements and disclosures. The Company has completed the review of all contracts and determined that the adoption of this guidance will primarily impact the timing of revenue recognition on certain concentrate contracts based on the Company’s determination of when control is transferred. Currently, revenue is recognized for these contracts based on varying contractual terms indicating when risk of loss and title have transferred to the buyer. Upon adoption, revenue related to concentrate sales will typically be recognized upon completion of

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NEWMONT MINING CORPORATION

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)

(dollars in millions, except per share, per ounce and per pound amounts)

loading the material for shipment to the customer and satisfaction of the Company’s significant performance obligations. The Company is finalizing the assessment and quantifying the impacts of changes on certain concentrate contracts.

The Company completed its evaluation of variable consideration for concentrate sales related to the variable nature of the price and metal quantity. Based on our current analysis, the estimate of revenue recognized for concentrates will remain unchanged as sales will initially be recorded on a provisional basis based on the forward prices for the estimated month of settlement and the Company’s estimated metal quantities delivered based on weighing and assay data. The Company believes changes in the underlying weight and metal content are not significant to the sale as a whole and therefore do not preclude the recognition of revenue upon transfer of control. The Company’s provisional gold and copper concentrate sales will continue to contain an embedded derivative that is required to be separated from the host contract for accounting purposes. The host contract is the receivable from the sale of the gold and copper concentrates at the prevailing indices’ prices at the time of sale. The embedded derivative, which does not qualify for hedge accounting, is marked to market through earnings each period prior to final settlement.

The Company will adopt the new guidance effective January 1, 2018. The guidance may be applied retrospectively for all periods presented or retrospectively with the cumulative effect of initially applying the guidance recognized at the date of initial application. The Company currently anticipates adopting the guidance retrospectively with the cumulative effect of initially applying the amended guidance recognized at January 1, 2018.

Under this approach, results for reporting periods beginning after January 1, 2018, will be presented in the Consolidated Financial Statements under the new guidance, while prior period amounts will not be adjusted and continue to be reported under the guidance in effect for those periods. In the related disclosures, results for reporting periods beginning after January 1, 2018, will be presented under prior guidance along with prior period amounts for comparative purposes. Expanded disclosures will also include gold revenue from doré production, gold and copper revenue from concentrate sales and copper revenue from cathode sales, as well as information pertaining to receivable balances, and revenue recognized in the current reporting period related to changes in price and metal quantity from performance obligations satisfied in previous periods, if material.

Investments

In January 2016, ASU No. 2016-01 was issued related to financial instruments. The new guidance requires entities to measure equity investments that do not result in consolidation and are not accounted for under the equity method at fair value and recognize any changes in fair value in net income. This new guidance also updates certain disclosure requirements for these investments. This update is effective in fiscal years, including interim periods, beginning after December 15, 2017, and upon adoption, an entity should apply the amendments with the cumulative effect of initially applying the guidance recognized at January 1, 2018. Early adoption is not permitted. The Company expects the updated guidance to result in a reclassification of unrealized holding gains and losses and deferred income taxes related to investments in marketable equity securities from Accumulated other comprehensive income (loss) to Retained earnings in the Consolidated Balance Sheets upon adoption. Accumulated other comprehensive income (loss) at September 30, 2017 included $(107) of unrealized holding gains and losses and deferred income taxes related to marketable equity securities.

Leases

In February 2016, ASU No. 2016-02 was issued related to leases, which was further amended in September 2017 by ASU No. 2017-13. The new guidance modifies the classification criteria and requires lessees to recognize the assets and liabilities arising from most leases on the balance sheet. The Company has begun its assessment of the new guidance and the impact it will have on the Consolidated Financial Statements and disclosures and expects to complete its analysis

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NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)

(dollars in millions, except per share, per ounce and per pound amounts)

in 2018. This update is effective in fiscal years, including interim periods, beginning after December 15, 2018, and early adoption is permitted. The Company anticipates adopting the new guidance effective January 1, 2019.

Statement of Cash Flows

In August 2016, ASU No. 2016-15 was issued related to the statement of cash flows. This new guidance addresses eight specific cash flow issues with the objective of reducing the existing diversity in practice in how certain cash receipts and cash payments are presented and classified in the statement of cash flows. This update is effective in fiscal years, including interim periods, beginning after December 15, 2017, and early adoption is permitted. The Company has evaluated this guidance and does not expect it to have a material impact on the Consolidated Financial Statements and disclosures. The Company anticipates retrospectively adopting the new guidance effective December 31, 2017.

Intra-Entity Transfers

In October 2016, ASU No. 2016-16 was issued related to the intra-entity transfers of assets other than inventory. This new guidance requires entities to recognize the income tax consequences of an intra-entity transfer of an asset other than inventory when the transfer occurs. This update is effective in fiscal years, including interim periods, beginning after December 15, 2017, and early adoption is permitted. The Company does not expect this guidance to have an impact on the Consolidated Financial Statements or disclosures. The Company anticipates adopting the new guidance effective January 1, 2018.

Restricted Cash

In November 2016, ASU No. 2016-18 was issued related to the inclusion of restricted cash in the statement of cash flows. This new guidance requires that a statement of cash flows explain the change during the period in the total of cash, cash equivalents and amounts generally described as restricted cash or restricted cash equivalents. This update is effective in fiscal years, including interim periods, beginning after December 15, 2017, and early adoption is permitted. The adoption of this guidance will result in the inclusion of the restricted cash balances within the overall cash balance and removal of the changes in restricted cash activity, which is currently recognized in Other within financing activities, on the Consolidated Statements of Cash Flows. Furthermore, the Company will be required to reconcile Cash and cash equivalents and restricted cash reported within the Consolidated Balance Sheets to the total shown in the Consolidated Statements of Cash Flows. The Company anticipates retrospectively adopting this new guidance effective December 31, 2017, and does not expect it to have a material impact on the Consolidated Financial Statements or disclosures.

Employee Benefits

In March 2017, ASU No. 2017-07 was issued related to the presentation of net periodic pension and postretirement cost. The new guidance requires the service cost component of net benefit costs be classified similar to other compensation costs arising from services rendered by employees. Other components of net benefit costs are required to be classified separately from the service cost and outside income from operations. This update is effective in fiscal years, including interim periods, beginning after December 15, 2017. The Company anticipates adopting this new guidance effective January 1, 2018. The adoption of this guidance will result in the recognition of other components of net benefit costs within Other income, net rather than Costs and expenses and will no longer be included in costs that benefit the inventory/production process. The adoption of this guidance is not expected to have a material impact on the Consolidated Financial Statements or disclosures.

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NEWMONT MINING CORPORATION

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)

(dollars in millions, except per share, per ounce and per pound amounts)

Hedging

In August 2017, ASU No. 2017-12 was issued related to hedge accounting. The new guidance expands the ability to hedge nonfinancial risk components, eliminates the current requirement to separately measure and report hedge ineffectiveness, and requires the entire change in fair value of a hedging instrument to be presented in the same income statement line as the hedged item, when reclassified from Accumulated other comprehensive income (loss). The guidance also eases certain hedge effectiveness documentation and assessment requirements. This update is effective in fiscal years, including interim periods, beginning after December 15, 2018, and early adoption is permitted. The Company is currently evaluating when to adopt this guidance and the impact it will have on the Consolidated Financial Statements and disclosures.

NOTE 3 DISCONTINUED OPERATIONS

The details of our Net income (loss) from discontinued operations are set forth below:


	Three Months Ended				Nine Months Ended
	September 30,				September 30,
	2017		2016		2017		2016
Holt royalty obligation	$	(7)	$	(19)	$	(45)	$	(72)
Batu Hijau operations		—		148		—		424
Loss on classification as held for sale		—		(577)		—		(577)
Net income (loss) from discontinued operations	$	(7)	$	(448)	$	(45)	$	(225)

The Holt Royalty Obligation

Discontinued operations include a retained royalty obligation to Holloway Mining Company. Holloway Mining Company, which owned the Holt-McDermott property (“Holt”), was sold to St. Andrew Goldfields Ltd. (“St. Andrew”) in 2006. In January 2016, St. Andrew was acquired by Kirkland Lake Gold Ltd.

At September 30, 2017 and December 31, 2016, the estimated fair value of the Holt royalty obligation was $248 and $187, respectively. Changes to the estimated fair value resulting from periodic revaluations are recorded to Net income (loss) from discontinued operations. During the three and nine months ended September 30, 2017, the Company recorded a gain (loss) of $(7) and $(45), net of a tax benefit (expense) of $4 and $25, respectively. During the three and nine months ended September 30, 2016, the Company recorded a gain (loss) of $(19) and $(72), net of tax benefit (expense) of $9 and $32, respectively.

During the nine months ended September 30, 2017 and 2016, the Company paid $9 and $8, respectively, related to the Holt royalty obligation. Refer to Note 13 for additional information on the Holt royalty obligation.

The Batu Hijau Transaction

On November 2, 2016, Newmont completed the sale of its 48.5% economic interest in PTNNT, which operated the Batu Hijau copper and gold mine, previously reported in the Asia Pacific segment (renamed as the Australia segment during the first quarter of 2017).

As of September 30, 2016, the Company classified PTNNT as held for sale. As a result, and in accordance with ASC 360, the Company compared the estimated fair value of the PTNNT disposal group to its carrying value and determined that the carrying value exceeded the fair value. Consequently, the Company recorded a charge to Loss on classification as held for sale of $577 for the quarter ended September 30, 2016.

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NEWMONT MINING CORPORATION

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)

(dollars in millions, except per share, per ounce and per pound amounts)

Net income (loss) from discontinued operations in the Condensed Consolidated Statements of Operations that relates to Batu Hijau consists of the following:


	Three Months Ended		Nine Months Ended
	September 30, 2016		September 30, 2016
Sales	$	469	$	1,408

Costs and expenses:
Costs applicable to sales (1)		184		571
Depreciation and amortization		36		115
Reclamation and remediation		4		13
Advanced projects, research and development		1		2
General and administrative		2		8
Other expense (income), net		(1)		2
		226		711
Interest expense, net		(5)		(15)
Income (loss) before income and mining tax and other items		238		682
Income and mining tax benefit (expense)		(90)		(258)
Net income (loss) from discontinued operations		148		424
Loss on classification of assets held for sale, net of tax		(577)		(577)
		(429)		(153)
Net loss (income) attributable to noncontrolling interests		(79)		(229)
Net income (loss) from discontinued operations attributable to Newmont stockholders	$	(508)	$	(382)

⁽¹⁾

Excludes Depreciation and amortization and Reclamation and remediation.

The consolidated statements of comprehensive income (loss) were not impacted by discontinued operations as PTNNT did not have any other comprehensive income (loss).

Cash flows from Batu Hijau consist of the following:


	Nine Months Ended
	September 30, 2016
Net cash provided by (used in) operating activities	$	834
Net cash provided by (used in) investing activities		(41)
Net cash provided by (used in) financing activities		(319)
Net cash provided by (used in) Batu Hijau discontinued operations	$	474

NOTE 4 SEGMENT INFORMATION

The Company has organized its operations into four geographic regions. The geographic regions include North America, South America, Australia and Africa and represent the Company’s operating segments. The results of these operating segments are reviewed by the Company’s chief operating decision maker to make decisions about resources to be allocated to the segments and assess their performance. As a result, these operating segments represent the Company’s reportable segments. Notwithstanding this structure, the Company internally reports information on a mine-by-mine basis for each mining operation and has chosen to disclose this information on the following tables. Income (loss) before income and mining tax and other items from reportable segments does not reflect general corporate expenses, interest (except project-specific interest) or income and mining taxes. Intercompany revenue and expense amounts have been eliminated within each segment in order to report on the basis that management uses internally for

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NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)

(dollars in millions, except per share, per ounce and per pound amounts)

evaluating segment performance. Newmont’s business activities that are not considered operating segments are included in Corporate and Other. Although they are not required to be included in this footnote, they are provided for reconciliation purposes.

In the first quarter of 2017, the Company renamed its Asia Pacific reporting segment to Australia. Segment results for the prior period have been retrospectively revised to reflect this change.

Unless otherwise noted, the Company presents only the reportable segments of our continuing operations in the tables below. The financial information relating to the Company’s segments is as follows:


							Advanced		Income (Loss)
			Costs		Depreciation		Projects, Research		before Income
			Applicable		and		and Development		and Mining Tax		Capital
	Sales		to Sales		Amortization		and Exploration		and Other Items		Expenditures(1)
Three Months Ended September 30, 2017
Carlin	$	330	$	216	$	60	$	6	$	46	$	32
Phoenix:
Gold		68		48		13
Copper		21		11		3
Total Phoenix		89		59		16		1		8		4
Twin Creeks		103		59		16		3		25		16
Long Canyon		70		17		24		6		22		1
CC&V		140		75		35		2		29		9
Other North America		—		—		—		10		(10)		1
North America		732		426		151		28		120		63

Yanacocha		176		150		38		11		(38)		12
Merian		162		62		22		3		75		29
Other South America		—		—		3		12		(18)		—
South America		338		212		63		26		19		41

Boddington:
Gold		236		130		26
Copper		59		25		5
Total Boddington		295		155		31		1		105		17
Tanami		148		72		17		7		50		25
Kalgoorlie		121		64		5		3		47		5
Other Australia		—		—		2		2		(10)		—
Australia		564		291		55		13		192		47

Ahafo		100		57		14		6		21		51
Akyem		145		67		40		3		35		5
Other Africa		—		—		—		—		(3)		—
Africa		245		124		54		9		53		56

Corporate and Other		—		—		4		13		(108)		1
Consolidated	$	1,879	$	1,053	$	327	$	89	$	276	$	208

⁽¹⁾

Includes an increase in accrued capital expenditures of $14; consolidated capital expenditures on a cash basis were $194.

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NEWMONT MINING CORPORATION

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)

(dollars in millions, except per share, per ounce and per pound amounts)


							Advanced		Income (Loss)
			Costs		Depreciation		Projects, Research		before Income
			Applicable		and		and Development		and Mining Tax		Capital
	Sales		to Sales		Amortization		and Exploration		and Other Items		Expenditures(1)
Three Months Ended September 30, 2016
Carlin	$	362	$	212	$	51	$	7	$	91	$	37
Phoenix:
Gold		61		30		10
Copper		20		32		8
Total Phoenix		81		62		18		—		(2)		8
Twin Creeks		129		52		10		2		64		9
Long Canyon		—		—		—		4		(4)		28
CC&V		152		65		32		3		50		13
Other North America		—		—		1		3		2		1
North America		724		391		112		19		201		96

Yanacocha		195		148		92		6		(66)		26
Merian		—		—		—		7		(8)		60
Other South America		—		—		3		8		(13)		—
South America		195		148		95		21		(87)		86

Boddington:
Gold		287		139		30
Copper		43		33		6
Total Boddington		330		172		36		—		106		17
Tanami		151		57		20		4		70		36
Kalgoorlie		120		57		5		1		56		5
Other Australia		—		—		1		2		(13)		—
Australia		601		286		62		7		219		58

Ahafo		115		95		30		8		(20)		22
Akyem		156		63		32		4		56		5
Other Africa		—		—		1		1		(3)		—
Africa		271		158		63		13		33		27

Corporate and Other		—		—		3		13		(143)		2
Consolidated	$	1,791	$	983	$	335	$	73	$	223	$	269

⁽¹⁾

There was no change to accrued capital expenditures; consolidated capital expenditures on a cash basis were $269.

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NEWMONT MINING CORPORATION

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)

(dollars in millions, except per share, per ounce and per pound amounts)


							Advanced		Income (Loss)
			Costs		Depreciation		Projects, Research		before Income
			Applicable		and		and Development		and Mining Tax		Capital
	Sales		to Sales		Amortization		and Exploration		and Other Items		Expenditures(1)
Nine Months Ended September 30, 2017
Carlin	$	862	$	579	$	156	$	14	$	106	$	128
Phoenix:
Gold		188		137		36
Copper		71		45		12
Total Phoenix		259		182		48		5		15		14
Twin Creeks		352		167		46		7		128		33
Long Canyon		166		42		55		16		52		8
CC&V		452		219		97		9		125		17
Other North America		—		—		1		17		(20)		4
North America		2,091		1,189		403		68		406		204

Yanacocha		504		403		108		23		(90)		32
Merian		445		174		69		11		189		67
Other South America		—		—		10		31		(53)		—
South America		949		577		187		65		46		99

Boddington:
Gold		726		399		81
Copper		156		74		15
Total Boddington		882		473		96		2		287		46
Tanami		363		180		48		16		125		77
Kalgoorlie		338		171		14		6		142		13
Other Australia		—		—		5		5		(30)		3
Australia		1,583		824		163		29		524		139

Ahafo		326		193		52		22		55		104
Akyem		464		202		114		9		135		17
Other Africa		—		—		—		2		(8)		—
Africa		790		395		166		33		182		121

Corporate and Other		—		—		9		39		(353)		5
Consolidated	$	5,413	$	2,985	$	928	$	234	$	805	$	568

⁽¹⁾

Includes an increase in accrued capital expenditures of $11; consolidated capital expenditures on a cash basis were $557.

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NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)

(dollars in millions, except per share, per ounce and per pound amounts)


							Advanced		Income (Loss)
			Costs		Depreciation		Projects, Research		before Income
			Applicable		and		and Development		and Mining Tax		Capital
	Sales		to Sales		Amortization		and Exploration		and Other Items		Expenditures(1)
Nine Months Ended September 30, 2016
Carlin	$	864	$	585	$	143	$	14	$	115	$	116
Phoenix:
Gold		187		118		37
Copper		63		76		20
Total Phoenix		250		194		57		1		(10)		15
Twin Creeks		432		170		36		6		217		29
Long Canyon		—		—		—		17		(17)		101
CC&V		361		156		78		7		115		49
Other North America		—		—		1		9		(7)		3
North America		1,907		1,105		315		54		413		313

Yanacocha		600		396		220		26		(96)		64
Merian		—		—		1		21		(22)		202
Other South America		—		—		10		24		(38)		—
South America		600		396		231		71		(156)		266

Boddington:
Gold		741		391		82
Copper		108		89		17
Total Boddington		849		480		99		—		245		40
Tanami		450		180		62		10		197		93
Kalgoorlie		348		189		14		4		138		13
Other Australia		—		—		7		5		(28)		—
Australia		1,647		849		182		19		552		146

Ahafo		331		212		62		20		30		61
Akyem		437		174		93		8		158		15
Other Africa		—		—		1		2		(7)		—
Africa		768		386		156		30		181		76

Corporate and Other		—		—		8		38		(318)		6
Consolidated	$	4,922	$	2,736	$	892	$	212	$	672	$	807

⁽¹⁾

Includes a decrease in accrued capital expenditures of $25; consolidated capital expenditures on a cash basis were $832.

NOTE 5 RECLAMATION AND REMEDIATION

The Company’s mining and exploration activities are subject to various domestic and international laws and regulations governing the protection of the environment. These laws and regulations are continually changing and are generally becoming more restrictive. The Company conducts its operations to protect public health and the environment and believes its operations are in compliance with applicable laws and regulations in all material respects. The Company has made, and expects to make in the future, expenditures to comply with such laws and regulations, but cannot predict the full amount of such future expenditures. Estimated future reclamation and remediation costs are based principally on current legal and regulatory requirements.

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NEWMONT MINING CORPORATION

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)

(dollars in millions, except per share, per ounce and per pound amounts)

The Company completed a comprehensive study of the current Yanacocha long-term mining and closure plans as part of the requirement to submit an updated closure plan to Peruvian regulators every five years. The updated closure plan was submitted to the Peruvian regulators and their review is expected to be completed in early 2018.

The Company’s Reclamation and remediation expense consisted of:


	Three Months Ended				Nine Months Ended
	September 30,				September 30,
	2017		2016		2017		2016
Reclamation	$	—	$	—	$	15	$	—
Reclamation accretion		25		19		75		57
		25		19		90		57

Remediation		3		5		9		7
Remediation accretion		1		1		4		3
		4		6		13		10
	$	29	$	25	$	103	$	67

Reclamation expense increased by $6 and increased by $33 during the three and nine months ended September 30, 2017, respectively, compared to the same periods in 2016, primarily due to updated reclamation liability assumptions at Yanacocha regarding water treatment costs on non-operating leach pads during the second quarter of 2017 and higher reclamation accretion from an increase in Reclamation and remediation liabilities associated with revisions to Yanacocha’s long-term mining and closure plans in December 2016.

The following are reconciliations of Reclamation and remediation liabilities:


	2017		2016
Reclamation balance at January 1,	$	1,792	$	1,300
Additions, changes in estimates and other		16		6
Payments and other		(20)		(14)
Accretion expense		75		57
Reclamation balance at September 30,	$	1,863	$	1,349


	2017		2016
Remediation balance at January 1,	$	298	$	318
Additions, changes in estimates and other		3		—
Payments and other		(33)		(21)
Accretion expense		4		3
Remediation balance at September 30,	$	272	$	300

The current portion of reclamation liabilities was $37 and $28 at September 30, 2017 and December 31, 2016, respectively, and was included in Other current liabilities. The current portion of remediation liabilities was $32 and $33 at September 30, 2017 and December 31, 2016, respectively, and was included in Other current liabilities. At September 30, 2017 and December 31, 2016, $1,863 and $1,792, respectively, were accrued for reclamation obligations relating to operating properties. In addition, the Company is involved in several matters concerning environmental remediation obligations associated with former, primarily historic, mining activities. Generally, these matters concern developing and implementing remediation plans at the various sites involved. At September 30, 2017 and December 31, 2016, $272 and $298, respectively, were accrued for such environmental remediation obligations.

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NEWMONT MINING CORPORATION

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)

(dollars in millions, except per share, per ounce and per pound amounts)

Non-current restricted assets held for purposes of settling reclamation and remediation obligations were $76 and $66 at September 30, 2017 and December 31, 2016, respectively. Of the amounts at September 30, 2017, $43 was related to the Midnite Mine in Washington State, $25 was related to the Ahafo and Akyem mines in Ghana, Africa and $8 was related to the Con mine in Yellowknife, NWT, Canada. Of the amount at December 31, 2016, $43 was related to the Midnite Mine, $14 was related to the Ahafo and Akyem mines and $9 was related to the Con mine.

Included in Investments at September 30, 2017 and December 31, 2016, was $23 and $20, respectively, of non-current equity securities, which are legally pledged for purposes of settling reclamation and remediation obligations related to the San Jose Reservoir in Yanacocha and for various locations in North America.

Refer to Note 24 for further discussion of reclamation and remediation matters.

NOTE 6 OTHER EXPENSE, NET


	Three Months Ended				Nine Months Ended
	September 30,				September 30,
	2017		2016		2017		2016
Restructuring and other	$	2	$	7	$	10	$	26
Impairment of long-lived assets		—		—		3		4
Acquisition cost adjustments		(3)		9		2		11
Other		2		5		17		13
	$	1	$	21	$	32	$	54

NOTE 7 OTHER INCOME, NET


	Three Months Ended				Nine Months Ended
	September 30,				September 30,
	2017		2016		2017		2016
Foreign currency exchange, net	$	(9)	$	(9)	$	(30)	$	(29)
Gain on asset and investment sales, net		5		5		21		109
Tanami insurance proceeds		—		—		13		—
Interest		9		2		19		7
Other		5		(2)		9		6
	$	10	$	(4)	$	32	$	93

Foreign currency exchange, net. Although the majority of the Company’s balances are denominated in U.S. dollars, foreign currency exchange gains (losses) are recognized on balances denominated in local currencies. These balances primarily relate to the timing of payments for employee-related benefits and other current liabilities in Australia, Peru and Suriname.

Gain on asset and investment sales, net. In June 2017, the Company exchanged its interest in the Fort á la Corne joint venture for equity ownership in Shore Gold Inc. (“Shore Gold”), resulting in a pre-tax gain of $15. For additional information regarding this transaction, see Note 15.

In March 2016, the Company sold its investment in Regis Resources Ltd. (“Regis”) for $184, resulting in a pre-tax gain of $103. The cost of the investment sold was determined using the specific identification method.

Tanami insurance proceeds. In June 2017, the Company recorded business interruption insurance proceeds of $13 associated with the heavy rainfall at Tanami during the first quarter of 2017.

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NEWMONT MINING CORPORATION

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)

(dollars in millions, except per share, per ounce and per pound amounts)

NOTE 8 INCOME AND MINING TAXES

The Company’s Income and mining tax expense (benefit) differed from the amounts computed by applying the U.S. statutory corporate income tax rate for the following reasons:


	Three Months Ended September 30,								Nine Months Ended September 30,
	2017				2016				2017				2016
Income (loss) before income and mining tax and other items			$	276			$	223			$	805			$	672

Tax at statutory rate	35	%	$	97	35	%	$	78	35	%	$	282	35	%	$	235
Reconciling items:
Percentage depletion	3			10	(5)			(11)	(8)			(64)	(7)			(47)
Change in valuation allowance on deferred tax assets	(14)			(39)	(2)			(5)	12			100	49			330
Mining and other taxes	—			(1)	6			13	4			34	6			41
U.S. tax effect of noncontrolling interest attributable to non-U.S. investees	2			5	4			10	1			5	3			20
Tax impact on sale of assets	(1)			(2)	—			—	(1)			(7)	(5)			(35)
Other	1			2	2			5	—			(1)	2			11
Income and mining tax expense	26	%	$	72	40	%	$	90	43	%	$	349	83	%	$	555

A valuation allowance is provided for those deferred tax assets for which it is more likely than not that the related benefits will not be realized. In determining the amount of the valuation allowance, each quarter, the Company considers future reversals of existing taxable temporary differences, estimated future taxable income and taxable income in prior carryback year(s), as well as feasible tax planning strategies in each jurisdiction to determine if the deferred tax assets are realizable. If it is determined that the Company will not realize all or a portion of its deferred tax assets, it will place or increase a valuation allowance. Conversely, if determined that it will ultimately be able to realize all or a portion of the related benefits for which a valuation allowance has been provided, all or a portion of the related valuation allowance will be reduced. There are a number of risk factors that could impact the Company’s ability to realize the deferred tax assets.

The Company operates in numerous countries and accordingly it is subject to, and pays taxes under, the various tax regimes in the countries in which it operates. Some of these tax regimes are defined by contractual agreements with the local government, and others are defined by the general corporate income tax laws of the country. The Company has historically filed, and continues to file, all required income tax returns and pay the income taxes determined to be due. The tax rules and regulations in many countries are complex and subject to interpretation. From time to time, the Company is subject to an audit of its historic income tax filings and in connection with such audits, disputes can arise with the taxing authorities over the interpretation or application of certain rules to the Company’s business conducted within the country involved.

During the second quarter of 2016, one of the Company’s Canadian subsidiaries received a tax and interest assessment from the Canadian Revenue Authority for $54 relating to a pre-acquisition transaction of Fronteer Gold Inc. and subsidiaries. The taxing authority is disputing the tax attribute that was created as part of the pre-acquisition transaction claimed on Fronteer’s tax return. Due to procedural requirements, the Company paid half of the assessment in the third quarter of 2016. The Company intends to vigorously defend its position through all processes available.

The Australian Taxation Office (“ATO”) is conducting a limited review of the Company’s prior years tax returns. The ATO is focused on reviewing an internal reorganization executed in 2011 when Newmont completed a restructure of the shareholding in the Company’s Australian subsidiaries. To date, the Company has responded to

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NEWMONT MINING CORPORATION

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)

(dollars in millions, except per share, per ounce and per pound amounts)

inquiries from the ATO and provided them with supporting documentation for the transaction and the Company’s associated tax positions. One aspect of the ATO review relates to an Australian capital gains tax that applies to sales or transfers of stock in certain types of entities. In the third quarter of 2017, the ATO notified the Company that it believes the 2011 reorganization is subject to capital gains tax of approximately $65 to $85 (before interest and penalties). The Company disputes this conclusion and intends to vigorously defend its position that the transaction is not subject to this tax. The Company continues to monitor the status of the ATO’s review which it expects to continue throughout the remainder of this year and into the following year.

As a result of the statute of limitations that expire in the next 12 months in various jurisdictions and possible settlements of audit-related issues with taxing authorities in various jurisdictions, none of which are individually significant, the Company believes that it is reasonably possible that the total amount of its net unrecognized income tax benefits will decrease by approximately $10 to $15 in the next 12 months.

NOTE 9 NET INCOME (LOSS) ATTRIBUTABLE TO NONCONTROLLING INTERESTS FROM CONTINUING OPERATIONS


	Three Months Ended				Nine Months Ended
	September 30,				September 30,
	2017		2016		2017		2016
Yanacocha	$	(25)	$	(32)	$	(64)	$	(56)
Merian		17		(2)		43		(6)
Other		—		—		(1)		—
	$	(8)	$	(34)	$	(22)	$	(62)

Newmont has a 51.35% ownership interest in Minera Yanacocha S.R.L., with the remaining interests held by Compañia de Minas Buenaventura, S.A.A. (43.65%) and the International Finance Corporation (5%). Newmont consolidates Minera Yanacocha S.R.L. in its Condensed Consolidated Financial Statements due to a majority voting interest.

Newmont has a 75.0% economic interest in Suriname Gold Project C.V. (“Merian”), with the remaining interests held by Staatsolie Maatschappij Suriname N.V. (“Staatsolie”), a company wholly owned by the Republic of Suriname. Newmont consolidates Merian, through its wholly-owned subsidiary, Newmont Suriname LLC., in its Condensed Consolidated Financial Statements as the primary beneficiary in the variable interest entity. Merian reached commercial production on October 1, 2016.

The following summarizes the assets and liabilities of Merian.


	At September 30,		At December 31,
	2017		2016
Current assets:
Cash and cash equivalents	$	41	$	50
Inventories		69		57
Stockpiles and ore on leach pads		18		23
Other current assets (1)		42		37
		170		167
Non-current assets:
Property, plant and mine development, net		747		746
Other non-current assets (2)		7		8
Total assets	$	924	$	921

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NEWMONT MINING CORPORATION

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)

(dollars in millions, except per share, per ounce and per pound amounts)


	At September 30,		At December 31,
	2017		2016
Current liabilities:
Other current liabilities (3)	$	47	$	43
		47		43
Non-current liabilities:
Reclamation and remediation liabilities		12		11
Total liabilities	$	59	$	54

⁽¹⁾

Other current assets include trade and other accounts receivables, prepaid assets and other current assets.

⁽²⁾

Other non-current assets include intangibles, stockpiles and ore on leach pads.

⁽³⁾

Other current liabilities include accounts payable, employee-related benefits and other current liabilities.

NOTE 10 INCOME (LOSS) PER COMMON SHARE

Basic income (loss) per common share is computed by dividing income available to Newmont common stockholders by the weighted average number of common shares outstanding during the period. Diluted income (loss) per common share is computed similarly, except that weighted average common shares is increased to reflect all dilutive instruments, including employee stock awards and convertible debt instruments. The dilutive effects of Newmont’s dilutive securities are calculated using the treasury stock method and only those instruments that result in a reduction in income per share are included in the calculation.


	Three Months Ended				Nine Months Ended
	September 30,				September 30,
	2017		2016		2017		2016
Net income (loss) attributable to Newmont stockholders:
Continuing operations	$	213	$	169	$	474	$	171
Discontinued operations		(7)		(527)		(45)		(454)
	$	206	$	(358)	$	429	$	(283)

Weighted average common shares (millions):
Basic		533		531		533		530
Effect of employee stock-based awards		3		2		1		2
Diluted		536		533		534		532

Net income (loss) per common share attributable to Newmont stockholders:
Basic:
Continuing operations	$	0.39	$	0.32	$	0.88	$	0.32
Discontinued operations		(0.01)		(0.99)		(0.08)		(0.85)
	$	0.38	$	(0.67)	$	0.80	$	(0.53)
Diluted:
Continuing operations	$	0.39	$	0.32	$	0.88	$	0.32
Discontinued operations		(0.01)		(0.99)		(0.08)		(0.85)
	$	0.38	$	(0.67)	$	0.80	$	(0.53)

Employee stock options to purchase 1 million and 2 million shares of common stock at weighted average exercise prices of $51.76 and $51.00 were outstanding at September 30, 2017 and 2016, respectively, but were not included in the computation of diluted weighted average common shares because their exercise prices exceeded the average price of the Company’s common stock for the respective periods presented.

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NEWMONT MINING CORPORATION

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)

(dollars in millions, except per share, per ounce and per pound amounts)

NOTE 11 EMPLOYEE PENSION AND OTHER BENEFIT PLANS


	Three Months Ended				Nine Months Ended
	September 30,				September 30,
	2017		2016		2017		2016
Pension benefit costs, net:
Service cost	$	7	$	6	$	22	$	21
Interest cost		11		11		33		34
Expected return on plan assets		(15)		(14)		(46)		(43)
Amortization, net		7		6		21		18
Settlements		1		4		5		4
	$	11	$	13	$	35	$	34


	Three Months Ended				Nine Months Ended
	September 30,				September 30,
	2017		2016		2017		2016
Other benefit costs, net:
Service cost	$	—	$	—	$	1	$	1
Interest cost		1		1		3		3
Amortization, net		(1)		(1)		(5)		(4)
	$	—	$	—	$	(1)	$	—

NOTE 12 STOCK-BASED COMPENSATION


	Three Months Ended				Nine Months Ended
	September 30,				September 30,
	2017		2016		2017		2016
Stock-based compensation:
Performance leveraged stock units	$	9	$	9	$	26	$	28
Restricted stock units		9		7		26		22
Strategic stock units		—		1		1		4
	$	18	$	17	$	53	$	54

NOTE 13 FAIR VALUE ACCOUNTING

Fair value accounting establishes a fair value hierarchy that prioritizes the inputs to valuation techniques used to measure fair value. The hierarchy gives the highest priority to unadjusted quoted prices in active markets for identical assets or liabilities (Level 1 measurements) and the lowest priority to unobservable inputs (Level 3 measurements). The three levels of the fair value hierarchy are described below:

Level 1Unadjusted quoted prices in active markets that are accessible at the measurement date for identical, unrestricted assets or liabilities;

Level 2Quoted prices in markets that are not active, or inputs that are observable, either directly or indirectly, for substantially the full term of the asset or liability; and

Level 3Prices or valuation techniques that require inputs that are both significant to the fair value measurement and unobservable (supported by little or no market activity).

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NEWMONT MINING CORPORATION

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)

(dollars in millions, except per share, per ounce and per pound amounts)

The following tables set forth the Company’s assets and liabilities measured at fair value on a recurring basis (at least annually) by level within the fair value hierarchy. As required by accounting guidance, assets and liabilities are classified in their entirety based on the lowest level of input that is significant to the fair value measurement.


	Fair Value at September 30, 2017
	Total		Level 1		Level 2		Level 3
Assets:
Cash and cash equivalents	$	2,969	$	2,969	$	—	$	—
Restricted assets		77		77		—		—
Diesel forward contracts		3		—		3		—
Marketable equity securities:
Extractive industries		170		170		—		—
Other		22		22		—		—
Trade receivable from provisional copper and gold concentrate sales, net		83		83		—		—
Batu Hijau contingent consideration		13		—		—		13
	$	3,337	$	3,321	$	3	$	13
Liabilities:
Debt (1)	$	4,612	$	—	$	4,612	$	—
Foreign exchange forward contracts		4		—		4		—
Boddington contingent consideration		13		—		—		13
Holt royalty obligation		248		—		—		248
	$	4,877	$	—	$	4,616	$	261


	Fair Value at December 31, 2016
	Total		Level 1		Level 2		Level 3
Assets:
Cash and cash equivalents	$	2,756	$	2,756	$	—	$	—
Restricted assets		68		68		—		—
Marketable equity securities:
Extractive industries		60		60		—		—
Other		16		16		—		—
Marketable debt securities:
Asset backed commercial paper		18		—		—		18
Trade receivable from provisional copper and gold concentrate sales, net		113		113		—		—
Batu Hijau contingent consideration		13		—		—		13
	$	3,044	$	3,013	$	—	$	31
Liabilities:
Debt (1)	$	4,882	$	—	$	4,882	$	—
Derivative instruments, net:
Foreign exchange forward contracts		24		—		24		—
Boddington contingent consideration		14		—		—		14
Holt royalty obligation		187		—		—		187
	$	5,107	$	—	$	4,906	$	201

⁽¹⁾

Debt, exclusive of capital leases, is carried at amortized cost. The outstanding carrying value was $4,038 and $4,599 at September 30, 2017 and December 31, 2016, respectively. The fair value measurement of debt was based on an independent third party pricing source.

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NEWMONT MINING CORPORATION

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)

(dollars in millions, except per share, per ounce and per pound amounts)

The fair values of the derivative instruments in the table above are presented on a net basis. The gross amounts related to the fair value of the derivatives instruments above are included in Note 14. All other fair value disclosures in the above table are presented on a gross basis.

The Company’s cash and cash equivalent instruments are classified within Level 1 of the fair value hierarchy because they are valued using quoted market prices. The cash and cash equivalent instruments that are valued based on quoted market prices in active markets are primarily money market securities and U.S. Treasury securities.

The Company’s restricted assets, which include cash and cash equivalents and marketable securities, are classified within Level 1 of the fair value hierarchy because they are valued using quoted market prices. Restricted assets that are valued based on quoted market prices in active markets are primarily money market securities and U.S. Treasury securities.

The Company’s marketable equity securities are valued using quoted market prices in active markets and as such are classified within Level 1 of the fair value hierarchy. The securities are segregated based on industry. The fair value of the marketable equity securities is calculated as the quoted market price of the marketable equity security multiplied by the quantity of shares held by the Company.

The Company’s net trade receivable from provisional copper and gold concentrate sales, subject to final pricing, is valued using quoted market prices based on forward curves and, as such, is classified within Level 1 of the fair value hierarchy.

The estimated value of the Batu Hijau contingent consideration was determined using (i) a discounted cash flow model, (ii) a Monte Carlo valuation model to simulate future copper prices using the Company’s long-term copper price, and (iii) estimated production and/or development dates for Batu Hijau Phase 7 and the Elang projects in Indonesia. The contingent consideration is classified within Level 3 of the fair value hierarchy.

The Company’s derivative instruments are valued using pricing models and the Company generally uses similar models to value similar instruments. Valuation models require a variety of inputs, including contractual terms, market prices, forward curves, measures of volatility, and correlations of such inputs. The Company’s derivatives trade in liquid markets and as such model inputs can generally be verified and do not involve significant management judgment. Such instruments are classified within Level 2 of the fair value hierarchy.

The estimated value of the Boddington contingent royalty was determined using (i) a discounted cash flow model, (ii) a Monte Carlo valuation model to simulate future gold and copper prices, using the Company’s long-term gold and copper prices, and (iii) a Monte Carlo valuation model to simulate costs applicable to sales using the Company’s Australian to U.S. dollar exchange rate. This contingent royalty is capped at $100, of which $87 has been paid to date. The contingent royalty is classified within Level 3 of the fair value hierarchy.

The estimated fair value of the Holt royalty obligation was determined using (i) a discounted cash flow model, (ii) a Monte Carlo valuation model to simulate future gold prices using the Company’s long-term gold price, (iii) various gold production scenarios from reserve and resource information and (iv) a weighted average discount rate. The royalty obligation is classified within Level 3 of the fair value hierarchy.

The Company’s marketable debt securities included investments in auction rate securities and asset backed commercial paper. The Company reviewed the fair value of the auction rate securities and asset backed commercial paper on a quarterly basis prior to the investments being redeemed in November 2016 and January 2017, respectively. The marketable debt securities were traded in markets that were not active, traded infrequently and had little price transparency. Therefore, the investments were classified as Level 3 of the fair value hierarchy.

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NEWMONT MINING CORPORATION

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)

(dollars in millions, except per share, per ounce and per pound amounts)

The following tables set forth a summary of the quantitative and qualitative information related to the unobservable inputs used in the calculation of the Company’s Level 3 financial assets and liabilities at September 30, 2017 and December 31, 2016:


	At September 30,				Range/Weighted
Description	2017		Valuation technique	Unobservable input	average
Batu Hijau contingent consideration	$	13	Monte Carlo	Discount rate		17.10	%
				Short-term copper price	$	2.88
				Long-term copper price	$	3.00
Boddington contingent consideration	$	13	Monte Carlo	Discount rate		3.10	%
				Short-term gold price	$	1,278
				Long-term gold price	$	1,300
				Short-term copper price	$	2.88
				Long-term copper price	$	3.00
				Long-term Australian to U.S. dollar exchange rate	$	0.80
Holt royalty obligation	$	248	Monte Carlo	Discount rate		2.99	%
				Short-term gold price	$	1,278
				Long-term gold price	$	1,300
				Gold production scenarios (in 000's of ounces)		420 - 1,797


	At December 31,				Range/Weighted
Description	2016		Valuation technique	Unobservable input	average
Asset backed commercial paper	$	18	Risk-adjusted indicative price	Recoverability rate		97	%
Batu Hijau contingent consideration	$	13	Monte Carlo	Discount rate		17.10	%
				Short-term copper price	$	2.39
				Long-term copper price	$	3.00
Boddington contingent consideration	$	14	Monte Carlo	Discount rate		3.36	%
				Short-term gold price	$	1,221
				Long-term gold price	$	1,300
				Short-term copper price	$	2.39
				Long-term copper price	$	3.00
				Long-term Australian to U.S. dollar exchange rate	$	0.80
Holt royalty obligation	$	187	Monte Carlo	Discount rate		3.36	%
				Short-term gold price	$	1,221
				Long-term gold price	$	1,300
				Gold production scenarios (in 000's of ounces)		332 - 1,570

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NEWMONT MINING CORPORATION

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)

(dollars in millions, except per share, per ounce and per pound amounts)

The following tables set forth a summary of changes in the fair value of the Company’s Level 3 financial assets and liabilities:


	Asset
	Backed		Batu Hijau				Boddington		Holt
	Commercial		Contingent		Total		Contingent		Royalty		Total
	Paper (1)		Consideration (2)		Assets		Consideration (3)		Obligation (2)		Liabilities
Fair value at December 31, 2016	$	18	$	13	$	31	$	14	$	187	$	201
Settlements		(18)		—		(18)		(9)		(9)		(18)
Revaluation		—		—		—		8		70		78
Fair value at September 30, 2017	$	—	$	13	$	13	$	13	$	248	$	261


			Asset
	Auction		Backed				Boddington		Holt
	Rate		Commercial		Total		Contingent		Royalty		Total
	Securities (1)		Paper (1)		Assets		Consideration (3)		Obligation (2)		Liabilities
Fair value at December 31, 2015	$	7	$	18	$	25	$	10	$	129	$	139
Settlements		—		—		—		—		(8)		(8)
Revaluation		—		2		2		11		104		115
Fair value at September 30, 2016	$	7	$	20	$	27	$	21	$	225	$	246

⁽¹⁾

The gain (loss) recognized is included in Other comprehensive income (loss).

⁽²⁾

The gain (loss) recognized is included in Net income (loss) from discontinued operations.

⁽³⁾

The gain (loss) recognized is included in Other expense, net.

NOTE 14 DERIVATIVE INSTRUMENTS

The Company’s strategy is to provide shareholders with leverage to changes in gold and copper prices by selling its production at spot market prices. Consequently, the Company does not hedge its gold and copper sales. The Company has and will continue to manage certain risks associated with commodity input costs, interest rates and foreign currencies using the derivative market.

Cash Flow Hedges

The following foreign currency and diesel contracts were transacted for risk management purposes and qualify as cash flow hedges. The effective portion of unrealized changes in market value have been recorded in Accumulated other comprehensive income (loss) and are reclassified to income during the period in which the hedged transaction affects earnings. Gains and losses from hedge ineffectiveness are recognized in current earnings.

Foreign Currency Contracts

The Company had the following foreign currency derivative contracts in Australia outstanding at September 30, 2017:


	Expected Maturity Date
	2017		2018		Total/Average
A$ Operating Fixed Forward Contracts:
A$ notional (millions)	24		6		30
Average rate ($/A$)	0.93		0.92		0.93
Expected hedge ratio	7	%	5	%

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NEWMONT MINING CORPORATION

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)

(dollars in millions, except per share, per ounce and per pound amounts)

Newmont utilizes foreign currency contracts to reduce the variability of the U.S. dollar amount of forecasted foreign currency expenditures caused by changes in exchange rates. The A$ hedges run through the first quarter of 2018.

Diesel Fixed Forward Contracts

The Company had the following diesel derivative contracts in Nevada, within North America, outstanding at September 30, 2017:


	Expected Maturity Date
	2017		2018		2019		Total/Average
Diesel Fixed Forward Contracts:
Diesel gallons (millions)	6		14		1		21
Average rate ($/gallon)	1.59		1.60		1.61		1.60
Expected hedge ratio	69	%	38	%	7	%

Newmont hedges a portion of its operating cost exposure related to diesel consumed at its Nevada operations to reduce the variability in diesel prices. The hedging instruments consist of a series of financially settled fixed forward contracts, which run through the first quarter of 2019.

Derivative Instrument Fair Values

The Company had the following derivative instruments designated as hedges at September 30, 2017 and December 31, 2016:


	Fair Values of Derivative Instruments
	At September 30, 2017
	Other		Other		Other		Other
	Current		Non-current		Current		Non-current
	Assets		Assets		Liabilities		Liabilities
A$ operating fixed forwards	$	—	$	—	$	4	$	—
Diesel fixed forwards		3		—		—		—
	$	3	$	—	$	4	$	—


	Fair Values of Derivative Instruments
	At December 31, 2016
	Other		Other		Other		Other
	Current		Non-current		Current		Non-current
	Assets		Assets		Liabilities		Liabilities
A$ operating fixed forwards	$	—	$	—	$	23	$	1
Diesel fixed forwards		4		—		4		—
	$	4	$	—	$	27	$	1

As of September 30, 2017 and December 31, 2016, all hedging instruments held by the Company were subject to enforceable master netting arrangements held by various financial institutions. In general, the terms of the Company’s agreements provide for offsetting of amounts payable or receivable between it and the counterparty, at the election of both parties, for transactions that occur on the same date and in the same currency. The Company’s agreements also provide that in the event of an early termination, the counterparties have the right to offset amounts owed or owing under that and any other agreement with the same counterparty. The Company’s accounting policy is to not offset these positions in its accompanying balance sheets. As of September 30, 2017 and December 31, 2016, the potential effect of netting derivative assets against liabilities due to the master netting agreement was not significant.

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NEWMONT MINING CORPORATION

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)

(dollars in millions, except per share, per ounce and per pound amounts)

The following tables show the location and amount of gains (losses) reported in the Company’s Condensed Consolidated Financial Statements related to the Company’s hedges.


	Foreign Currency				Diesel Fixed				Interest
	Exchange Contracts				Forward Contracts				Rate Contracts
	2017		2016		2017		2016		2017		2016
For the three months ended September 30,
Cash flow hedging relationships:
Gain (loss) recognized in Other comprehensive income (loss) (effective portion)	$	1	$	4	$	5	$	—	$	—	$	—
Gain (loss) reclassified from Accumulated other comprehensive income (loss) into income (loss) (effective portion) (1)	$	(5)	$	(9)	$	—	$	(4)	$	(2)	$	(3)
For the nine months ended September 30,
Cash flow hedging relationships:
Gain (loss) recognized in Other comprehensive income (loss) (effective portion)	$	5	$	8	$	(1)	$	5	$	—	$	—
Gain (loss) reclassified from Accumulated other comprehensive income (loss) into income (loss) (effective portion) (1)	$	(20)	$	(29)	$	(3)	$	(18)	$	(7)	$	(11)
Gain (loss) reclassified from Accumulated other comprehensive income (loss) into income (loss) (ineffective portion) (2)	$	—	$	—	$	—	$	1	$	—	$	—

⁽¹⁾

The gain (loss) recognized for the effective portion of cash flow hedges is included in Costs applicable to sales and Interest expense, net.

⁽²⁾

The ineffective portion recognized for cash flow hedges is included in Other income, net.

Over the next 12 months, the Company expects to reclassify from Accumulated other comprehensive income (loss) to income a loss of approximately $10, net of tax, related to unrealized hedge losses.

Batu Hijau Contingent Consideration

Consideration received by the Company in conjunction with the sale of PTNNT included the Contingent Payment and the Elang Development deferred payment deeds, which were determined to be financial instruments that met the definition of a derivative, but do not qualify for hedge accounting, under ASC 815. See Note 13 for additional information. Contingent consideration of $13 was included in Other non-current assets in the Company's Consolidated Balance Sheets as of September 30, 2017 and December 31, 2016. There was no change in the value of the contingent consideration during the three or nine months ended September 30, 2017.

Provisional Gold and Copper Sales

The Company’s provisional gold and copper concentrate sales contain an embedded derivative that is required to be separated from the host contract for accounting purposes. The host contract is the receivable from the sale of the gold and copper concentrates at the prevailing indices’ prices at the time of sale. The embedded derivative, which does not qualify for hedge accounting, is marked to market through earnings each period prior to final settlement.

At September 30, 2017, Newmont had gold and copper sales of 75,000 ounces and 20 million pounds priced at an average of $1,285 per ounce and $2.96 per pound, respectively, subject to final pricing over the next several months.

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NEWMONT MINING CORPORATION

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)

(dollars in millions, except per share, per ounce and per pound amounts)

NOTE 15 INVESTMENTS


	At September 30, 2017
	Cost/Equity		Unrealized				Fair/Equity
	Basis		Gain		Loss		Basis
Current:
Marketable equity securities	$	39	$	44	$	(7)	$	76

Non-current:
Marketable equity securities:
Continental Gold Inc.	$	109	$	—	$	(19)	$	90
Other marketable equity securities		23		3		—		26
		132		3		(19)		116

Other investments, at cost		7		—		—		7

Equity method investments:
TMAC Resources Inc. (28.80%)		109		—		—		109
Minera La Zanja S.R.L. (46.94%)		56		—		—		56
Euronimba Ltd. (43.50%)		4		—		—		4
		169		—		—		169
	$	308	$	3	$	(19)	$	292


	At December 31, 2016
	Cost/Equity		Unrealized				Fair/Equity
	Basis		Gain		Loss		Basis
Current:
Marketable equity securities	$	33	$	27	$	(4)	$	56

Non-current:
Marketable debt securities:
Asset backed commercial paper	$	16	$	2	$	—	$	18

Marketable equity securities		18		2		—		20
Other investments, at cost		6		—		—		6

Equity method investments:
TMAC Resources Inc. (29.00%)		108		—		—		108
Minera La Zanja S.R.L. (46.94%)		71		—		—		71
Euronimba Ltd. (43.50%)		4		—		—		4
		183		—		—		183
	$	223	$	4	$	—	$	227

During the third quarter of 2017, Newmont sold approximately two-thirds of its interest in Novo Resources Corp. for $15, resulting in a pre-tax gain of $5 recorded in Other income, net. Newmont continues to hold approximately 6 million common shares of Novo Resources Corp. The cost of the investment sold was determined using the specific identification method.

In June 2017, Newmont exchanged its 31% interest in the Fort á la Corne joint venture in consideration for 54 million common shares and 1 million common share warrants in Shore Gold, valued at $15. Following the transaction, Newmont held a 19.9% equity ownership in Shore Gold. This investment has been classified as current.

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NEWMONT MINING CORPORATION

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)

(dollars in millions, except per share, per ounce and per pound amounts)

In May 2017, Newmont purchased 37 million common shares of Continental Gold Inc. (“Continental”) at C$4.00 per share. Continental is developing the high-grade Buriticá gold project in Colombia. Total consideration paid by Newmont was $109 for a 19.9% equity ownership in Continental.

In April 2017, Newmont purchased 13 million units (one common share and one warrant per unit) of Goldstrike Resources Ltd. (“Goldstrike”) at a price of C$0.47 per share for $4. The investment secures rights to explore and develop the Plateau property located in a highly prospective mineralized trend in Canada’s Yukon Territory with Goldstrike, with the ability to earn additional ownership in the project through exploration investment. This investment has been classified as non-current.

In January 2017, the Company’s remaining asset backed commercial paper was called at par resulting in no realized gain or loss.

There were no investment impairments for other-than-temporary declines in value or significant changes in fair value on those available-for-sale securities previously impaired during the three and nine months ended September 30, 2017. During the three and nine months ended September 30, 2016, the Company recognized no investment impairments for other-than-temporary declines in value. During the three months ended September 30, 2016, there was a $7 increase in the fair value of available-for-sale securities previously impaired, primarily due to a $6 increase in Gabriel Resources Ltd. During the nine months ended September 30, 2016, there was a $30 increase in the fair value of available-for-sale securities previously impaired, primarily due to a $19 increase in Gabriel Resources Ltd and a $5 increase in Pilot Gold.

NOTE 16 INVENTORIES


	At September 30,		At December 31,
	2017		2016
Materials and supplies	$	426	$	391
In-process		128		130
Concentrate and copper cathode		92		67
Precious metals		46		29
	$	692	$	617

NOTE 17 STOCKPILES AND ORE ON LEACH PADS


	At September 30,		At December 31,
	2017		2016
Current:
Stockpiles	$	374	$	393
Ore on leach pads		340		370
	$	714	$	763
Non-current:
Stockpiles	$	1,468	$	1,506
Ore on leach pads		328		358
	$	1,796	$	1,864

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NEWMONT MINING CORPORATION

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)

(dollars in millions, except per share, per ounce and per pound amounts)


	At September 30,		At December 31,
	2017		2016
Stockpiles and ore on leach pads:
Carlin	$	452	$	421
Phoenix		70		80
Twin Creeks		337		328
Long Canyon		29		9
CC&V		309		369
Yanacocha		255		367
Merian		21		27
Boddington		414		394
Tanami		11		19
Kalgoorlie		125		113
Ahafo		405		386
Akyem		82		114
	$	2,510	$	2,627

During the three and nine months ended September 30, 2017, the Company recorded write-downs of $60 and $146, respectively, classified as components of Costs applicable to sales, and write-downs of $23 and $54, respectively, classified as components of Depreciation and amortization to reduce the carrying value of stockpiles and ore on leach pads to net realizable value. Of the write-downs during the three months ended September 30, 2017, $28 is related to Carlin, $16 to Twin Creeks, $28 to Yanacocha and $11 to Akyem. Of the write-downs during the nine months ended September 30, 2017, $62 is related to Carlin, $32 to Twin Creeks, $69 to Yanacocha, $18 to Ahafo and $19 to Akyem.

During the three and nine months ended September 30, 2016, the Company recorded write-downs of $92 and $199, respectively, classified as components of Costs applicable to sales, and write-downs of $45 and $95, respectively, classified as components of Depreciation and amortization to reduce the carrying value of stockpiles and ore on leach pads to net realizable value. Of the write-downs during the three months ended September 30, 2016, $12 was related to Carlin, $1 to Twin Creeks, $77 to Yanacocha and $47 to Ahafo. Of the write-downs during the nine months ended September 30, 2016, $69 was related to Carlin, $14 to Twin Creeks, $164 to Yanacocha and $47 to Ahafo.

NOTE 18 DEBT

Scheduled minimum debt repayments are $- for the remainder of 2017, $- in 2018, $626 in 2019, $- in 2020, $- in 2021 and $3,466 thereafter. Scheduled minimum capital lease repayments are $1 in 2017, $4 in 2018, $3 in 2019, $1 in 2020, $1 in 2021 and $2 thereafter.

In May 2017, the Company amended its $3,000 Corporate Revolving Credit Facility to extend the facility to May 2022.

In July 2017, the Company repaid the $575 outstanding aggregate principal amount of the 2017 Convertible Senior Notes at maturity.

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NEWMONT MINING CORPORATION

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)

(dollars in millions, except per share, per ounce and per pound amounts)

NOTE 19 OTHER LIABILITIES


	At September 30,		At December 31,
	2017		2016
Other current liabilities:
Accrued operating costs	$	109	$	99
Reclamation and remediation liabilities		69		61
Accrued capital expenditures		63		53
Accrued interest		62		57
Royalties		34		52
Holt royalty obligation		14		13
Taxes other than income and mining		8		8
Boddington contingent consideration		6		3
Derivative instruments		4		27
Other		9		34
	$	378	$	407

Other non-current liabilities:
Holt royalty obligation	$	234	$	174
Income and mining taxes		48		50
Power supply agreements		32		31
Social development obligations		24		25
Boddington contingent consideration		7		11
Other		12		35
	$	357	$	326

Table of Contents

NEWMONT MINING CORPORATION

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)

(dollars in millions, except per share, per ounce and per pound amounts)

NOTE 20 CHANGES IN EQUITY


	Nine Months Ended September 30,
	2017		2016
Common stock:
At beginning of period	$	849	$	847
Stock-based awards		4		2
At end of period		853		849
Additional paid-in capital:
At beginning of period		9,490		9,427
Stock-based awards		36		42
At end of period		9,526		9,469
Accumulated other comprehensive income (loss):
At beginning of period		(334)		(334)
Other comprehensive income (loss)		42		32
At end of period		(292)		(302)
Retained earnings:
At beginning of period		716		1,410
Net income (loss) attributable to Newmont stockholders		429		(283)
Dividends paid		(94)		(41)
At end of period		1,051		1,086
Noncontrolling interests:
At beginning of period		1,153		2,942
Net income (loss) attributable to noncontrolling interests		(22)		167
Distributions declared to noncontrolling interests (1)		(110)		—
Cash calls requested from noncontrolling interests (2)		72		63
Dividends paid to noncontrolling interests		—		(146)
Acquisition of noncontrolling interests		—		(19)
At end of period		1,093		3,007
Total equity	$	12,231	$	14,109

⁽¹⁾

Distributions declared to noncontrolling interests of $110 for the nine months ended September 30, 2017 represent distributions declared to Staatsolie from Merian. The Company paid $119 in distributions during the nine months ended September 30, 2017 related to current and prior period distributions declared.

⁽²⁾

Cash calls requested from noncontrolling interests of $72 and $63 for the nine months ended September 30, 2017 and September 30, 2016, respectively, represent cash calls requested from Staatsolie, of which $70 and $58 had been paid as of September 30, 2017 and September 30, 2016.

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NEWMONT MINING CORPORATION

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)

(dollars in millions, except per share, per ounce and per pound amounts)

NOTE 21 RECLASSIFICATIONS OUT OF ACCUMULATED OTHER COMPREHENSIVE INCOME (LOSS)


					Pension and		Unrealized Gain
	Unrealized Gain		Foreign		Other		(Loss) on
	(Loss) on		Currency		Post-retirement		Cash flow
	Marketable		Translation		Benefit		Hedge
	Securities, net		Adjustments		Adjustments		Instruments		Total
Balance at December 31, 2016	$	(101)	$	118	$	(223)	$	(128)	$	(334)
Change in other comprehensive income (loss) before reclassifications		(1)		12		(1)		3		13
Reclassifications from accumulated other comprehensive income (loss)		(5)		—		14		20		29
Net current-period other comprehensive income (loss)		(6)		12		13		23		42
Balance at September 30, 2017	$	(107)	$	130	$	(210)	$	(105)	$	(292)


Details about Accumulated Other Comprehensive Income (Loss) Components	Amount Reclassified from Accumulated Other Comprehensive Income (Loss)								Affected Line Item in the Condensed Consolidated Statements of Operations
	Three Months Ended September 30,				Nine Months Ended September 30,
	2017		2016		2017		2016
Marketable securities adjustments:
Sale of marketable securities	$	(5)	$	—	$	(5)	$	(103)	Other income, net
Total before tax		(5)		—		(5)		(103)
Tax benefit (expense)		—		—		—		—
Net of tax	$	(5)	$	—	$	(5)	$	(103)

Pension and other post-retirement benefit adjustments:
Amortization	$	6	$	5	$	16	$	14	(1)
Settlements		1		4		5		4	Other expense, net
Total before tax		7		9		21		18
Tax benefit (expense)		(2)		(3)		(7)		(6)
Net of tax	$	5	$	6	$	14	$	12

Hedge instruments adjustments:
Operating cash flow hedges (effective portion)	$	5	$	13	$	23	$	47	Costs applicable to sales
Operating cash flow hedges (ineffective portion)		—		—		—		(1)	Other income, net
Interest rate contracts		2		3		7		11	Interest expense, net
Total before tax		7		16		30		57
Tax benefit (expense)		(2)		(4)		(10)		(17)
Net of tax	$	5	$	12	$	20	$	40
Total reclassifications for the period, net of tax	$	5	$	18	$	29	$	(51)

⁽¹⁾

This accumulated other comprehensive income (loss) component is included in General and administrative and costs that benefit the inventory/production process. Refer to Note 2 to the Consolidated Financial Statements for the year ended December 31, 2016 filed February 21, 2017 on Form 10-K for information on costs that benefit the inventory/production process.

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NEWMONT MINING CORPORATION

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)

(dollars in millions, except per share, per ounce and per pound amounts)

NOTE 22 NET CHANGE IN OPERATING ASSETS AND LIABILITIES

Net cash provided by (used in) operating activities of continuing operations attributable to the net change in operating assets and liabilities is composed of the following:


	Nine Months Ended September 30,
	2017		2016
Decrease (increase) in operating assets:
Trade and other accounts receivables	$	77	$	34
Inventories, stockpiles and ore on leach pads		(162)		(243)
Other assets		(11)		(63)
Increase (decrease) in operating liabilities:
Accounts payable		(8)		(16)
Reclamation and remediation liabilities		(53)		(35)
Employee-related liabilities		(81)		(79)
Other accrued liabilities		(4)		(24)
	$	(242)	$	(426)

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NEWMONT MINING CORPORATION

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)

(dollars in millions, except per share, per ounce and per pound amounts)

NOTE 23 CONDENSED CONSOLIDATING FINANCIAL STATEMENTS

The following Condensed Consolidating Financial Statements are presented to satisfy disclosure requirements of Rule 3-10(e) of Regulation S-X resulting from the inclusion of Newmont USA Limited (“Newmont USA”), a wholly-owned subsidiary of Newmont, as a co-registrant with Newmont on debt securities issued under a shelf registration statement on Form S-3 filed under the Securities Act of 1933 under which securities of Newmont (including debt securities guaranteed by Newmont USA) may be issued (the “Shelf Registration Statement”). In accordance with Rule 3-10(e) of Regulation S-X, Newmont USA, as the subsidiary guarantor, is 100% owned by Newmont, the guarantees are full and unconditional, and no other subsidiary of Newmont guaranteed any security issued under the Shelf Registration Statement. There are no restrictions on the ability of Newmont or Newmont USA to obtain funds from its subsidiaries by dividend or loan.


	Three Months Ended September 30, 2017
	(Issuer)		(Guarantor)		(Non-Guarantor)				Newmont
	Newmont								Mining
	Mining		Newmont		Other				Corporation
Condensed Consolidating Statement of Operation	Corporation		USA		Subsidiaries		Eliminations		Consolidated
Sales	$	—	$	494	$	1,385	$	—	$	1,879
Costs and expenses:
Costs applicable to sales (1)		—		318		735		—		1,053
Depreciation and amortization		1		94		232		—		327
Reclamation and remediation		—		4		25		—		29
Exploration		—		10		38		—		48
Advanced projects, research and development		—		10		31		—		41
General and administrative		—		18		40		—		58
Other expense, net		—		—		1		—		1
		1		454		1,102		—		1,557
Other income (expense):
Other income, net		11		2		(3)		—		10
Interest income - intercompany		67		11		11		(89)		—
Interest expense - intercompany		(11)		—		(78)		89		—
Interest expense, net		(51)		(5)		—		—		(56)
		16		8		(70)		—		(46)
Income (loss) before income and mining tax and other items		15		48		213		—		276
Income and mining tax benefit (expense)		(5)		(18)		(49)		—		(72)
Equity income (loss) of affiliates		196		(52)		(3)		(140)		1
Net income (loss) from continuing operations		206		(22)		161		(140)		205
Net income (loss) from discontinued operations		—		—		(7)		—		(7)
Net income (loss)		206		(22)		154		(140)		198
Net loss (income) attributable to noncontrolling interests:
Continuing operations		—		—		8		—		8
Discontinued operations		—		—		—		—		—
		—		—		8		—		8
Net income (loss) attributable to Newmont stockholders	$	206	$	(22)	$	162	$	(140)	$	206
Comprehensive income (loss)	$	232	$	(14)	$	146	$	(140)	$	224
Comprehensive loss (income) attributable to noncontrolling interests		—		—		8		—		8
Comprehensive income (loss) attributable to Newmont stockholders	$	232	$	(14)	$	154	$	(140)	$	232

⁽¹⁾

Excludes Depreciation and amortization and Reclamation and remediation.

Table of Contents

NEWMONT MINING CORPORATION

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)

(dollars in millions, except per share, per ounce and per pound amounts)


	Three Months Ended September 30, 2016
	(Issuer)		(Guarantor)		(Non-Guarantor)				Newmont
	Newmont								Mining
	Mining		Newmont		Other				Corporation
Condensed Consolidating Statement of Operation	Corporation		USA		Subsidiaries		Eliminations		Consolidated
Sales	$	—	$	537	$	1,254	$	—	$	1,791
Costs and expenses:
Costs applicable to sales (1)		—		308		675		—		983
Depreciation and amortization		1		80		254		—		335
Reclamation and remediation		—		3		22		—		25
Exploration		—		10		29		—		39
Advanced projects, research and development		—		4		30		—		34
General and administrative		—		25		38		—		63
Other expense, net		—		7		14		—		21
		1		437		1,062		—		1,500
Other income (expense):
Other income, net		2		5		(11)		—		(4)
Interest income - intercompany		41		—		14		(55)		—
Interest expense - intercompany		(13)		—		(42)		55		—
Interest expense, net		(61)		(2)		(1)		—		(64)
		(31)		3		(40)		—		(68)
Income (loss) before income and mining tax and other items		(32)		103		152		—		223
Income and mining tax benefit (expense)		11		(23)		(78)		—		(90)
Equity income (loss) of affiliates		(338)		(78)		2		416		2
Net income (loss) from continuing operations		(359)		2		76		416		135
Net income (loss) from discontinued operations		—		—		(448)		—		(448)
Net income (loss)		(359)		2		(372)		416		(313)
Net loss (income) attributable to noncontrolling interests:
Continuing operations		—		—		34		—		34
Discontinued operations		—		—		(79)		—		(79)
		—		—		(45)		—		(45)
Net income (loss) attributable to Newmont stockholders	$	(359)	$	2	$	(417)	$	416	$	(358)
Comprehensive income (loss)	$	(319)	$	8	$	(340)	$	377	$	(274)
Comprehensive loss (income) attributable to noncontrolling interests		—		—		(45)		—		(45)
Comprehensive income (loss) attributable to Newmont stockholders	$	(319)	$	8	$	(385)	$	377	$	(319)

⁽¹⁾

Excludes Depreciation and amortization and Reclamation and remediation.

Table of Contents

NEWMONT MINING CORPORATION

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)

(dollars in millions, except per share, per ounce and per pound amounts)


	Nine Months Ended September 30, 2017
	(Issuer)		(Guarantor)		(Non-Guarantor)				Newmont
	Newmont								Mining
	Mining		Newmont		Other				Corporation
Condensed Consolidating Statement of Operation	Corporation		USA		Subsidiaries		Eliminations		Consolidated
Sales	$	—	$	1,414	$	3,999	$	—	$	5,413
Costs and expenses:
Costs applicable to sales (1)		—		883		2,102		—		2,985
Depreciation and amortization		3		255		670		—		928
Reclamation and remediation		—		11		92		—		103
Exploration		—		32		103		—		135
Advanced projects, research and development		—		13		86		—		99
General and administrative		—		53		118		—		171
Other expense, net		—		8		24		—		32
		3		1,255		3,195		—		4,453
Other income (expense):
Other income, net		37		5		(10)		—		32
Interest income - intercompany		114		35		33		(182)		—
Interest expense - intercompany		(33)		(4)		(145)		182		—
Interest expense, net		(172)		(8)		(7)		—		(187)
		(54)		28		(129)		—		(155)
Income (loss) before income and mining tax and other items		(57)		187		675		—		805
Income and mining tax benefit (expense)		20		(40)		(329)		—		(349)
Equity income (loss) of affiliates		466		(286)		(17)		(167)		(4)
Net income (loss) from continuing operations		429		(139)		329		(167)		452
Net income (loss) from discontinued operations		—		—		(45)		—		(45)
Net income (loss)		429		(139)		284		(167)		407
Net loss (income) attributable to noncontrolling interests:
Continuing operations		—		—		22		—		22
Discontinued operations		—		—		—		—		—
		—		—		22		—		22
Net income (loss) attributable to Newmont stockholders	$	429	$	(139)	$	306	$	(167)	$	429
Comprehensive income (loss)	$	471	$	(124)	$	269	$	(167)	$	449
Comprehensive loss (income) attributable to noncontrolling interests		—		—		22		—		22
Comprehensive income (loss) attributable to Newmont stockholders	$	471	$	(124)	$	291	$	(167)	$	471

⁽¹⁾

Excludes Depreciation and amortization and Reclamation and remediation.

Table of Contents

NEWMONT MINING CORPORATION

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)

(dollars in millions, except per share, per ounce and per pound amounts)


	Nine Months Ended September 30, 2016
	(Issuer)		(Guarantor)		(Non-Guarantor)				Newmont
	Newmont								Mining
	Mining		Newmont		Other				Corporation
Condensed Consolidating Statement of Operation	Corporation		USA		Subsidiaries		Eliminations		Consolidated
Sales	$	—	$	1,467	$	3,455	$	—	$	4,922
Costs and expenses:
Costs applicable to sales (1)		—		898		1,838		—		2,736
Depreciation and amortization		3		240		649		—		892
Reclamation and remediation		—		10		57		—		67
Exploration		—		25		82		—		107
Advanced projects, research and development		—		9		96		—		105
General and administrative		—		65		113		—		178
Other expense, net		—		21		33		—		54
		3		1,268		2,868		—		4,139
Other income (expense):
Other income, net		2		7		84		—		93
Interest income - intercompany		102		—		32		(134)		—
Interest expense - intercompany		(31)		—		(103)		134		—
Interest expense, net		(196)		(5)		(3)		—		(204)
		(123)		2		10		—		(111)
Income (loss) before income and mining tax and other items		(126)		201		597		—		672
Income and mining tax benefit (expense)		44		(42)		(557)		—		(555)
Equity income (loss) of affiliates		(200)		(525)		1		716		(8)
Net income (loss) from continuing operations		(282)		(366)		41		716		109
Net income (loss) from discontinued operations		—		—		(225)		—		(225)
Net income (loss)		(282)		(366)		(184)		716		(116)
Net loss (income) attributable to noncontrolling interests:
Continuing operations		—		—		62		—		62
Discontinued operations		—		—		(229)		—		(229)
		—		—		(167)		—		(167)
Net income (loss) attributable to Newmont stockholders	$	(282)	$	(366)	$	(351)	$	716	$	(283)
Comprehensive income (loss)	$	(251)	$	(341)	$	(184)	$	692	$	(84)
Comprehensive loss (income) attributable to noncontrolling interests		—		—		(167)		—		(167)
Comprehensive income (loss) attributable to Newmont stockholders	$	(251)	$	(341)	$	(351)	$	692	$	(251)

⁽¹⁾

Excludes Depreciation and amortization and Reclamation and remediation.

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NEWMONT MINING CORPORATION

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)

(dollars in millions, except per share, per ounce and per pound amounts)


	Nine Months Ended September 30, 2017
	(Issuer)		(Guarantor)		(Non-Guarantor)				Newmont
	Newmont								Mining
	Mining		Newmont		Other				Corporation
Condensed Consolidating Statement of Cash Flows	Corporation		USA		Subsidiaries		Eliminations		Consolidated
Operating activities:
Net cash provided by (used in) operating activities of continuing operations	$	(111)	$	375	$	1,332	$	—	$	1,596
Net cash provided by (used in) operating activities of discontinued operations		—		—		(12)		—		(12)
Net cash provided by (used in) operating activities		(111)		375		1,320		—		1,584
Investing activities:
Additions to property, plant and mine development		—		(171)		(386)		—		(557)
Purchase of investments		(109)		—		(4)		—		(113)
Proceeds from sales of investments		—		—		34		—		34
Other		—		2		7		—		9
Net cash provided by (used in) investing activities of continuing operations		(109)		(169)		(349)		—		(627)
Net cash provided by (used in) investing activities of discontinued operations		—		—		—		—		—
Net cash provided by (used in) investing activities		(109)		(169)		(349)		—		(627)
Financing activities:
Repayment of debt		(575)		(2)		(2)		—		(579)
Distributions to noncontrolling interests		—		—		(119)		—		(119)
Dividends paid to common stockholders		(94)		—		—		—		(94)
Funding from noncontrolling interests		—		—		70		—		70
Payments for withholding of employee taxes related to stock-based compensation		—		(13)		—		—		(13)
Dividends paid to noncontrolling interests		—		—		—		—		—
Acquisition of noncontrolling interests		—		—		—		—		—
Net intercompany borrowings (repayments)		892		(192)		(700)		—		—
Other		(3)		—		(10)		—		(13)
Net cash provided by (used in) financing activities of continuing operations		220		(207)		(761)		—		(748)
Net cash provided by (used in) financing activities of discontinued operations		—		—		—		—		—
Net cash provided by (used in) financing activities		220		(207)		(761)		—		(748)
Effect of exchange rate changes on cash		—		—		4		—		4
Net change in cash and cash equivalents		—		(1)		214		—		213
Less net cash provided by (used in) Batu Hijau discontinued operations		—		—		—		—		—
		—		(1)		214		—		213
Cash and cash equivalents at beginning of period		—		1		2,755		—		2,756
Cash and cash equivalents at end of period	$	—	$	—	$	2,969	$	—	$	2,969

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NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)

(dollars in millions, except per share, per ounce and per pound amounts)


	Nine Months Ended September 30, 2016
	(Issuer)		(Guarantor)		(Non-Guarantor)				Newmont
	Newmont								Mining
	Mining		Newmont		Other				Corporation
Condensed Consolidating Statement of Cash Flows	Corporation		USA		Subsidiaries		Eliminations		Consolidated
Operating activities:
Net cash provided by (used in) operating activities of continuing operations	$	775	$	459	$	961	$	(862)	$	1,333
Net cash provided by (used in) operating activities of discontinued operations		—		—		826		—		826
Net cash provided by (used in) operating activities		775		459		1,787		(862)		2,159
Investing activities:
Additions to property, plant and mine development		—		(182)		(650)		—		(832)
Purchases of investments		—		—		—		—		—
Proceeds from sales of investments		—		—		184		—		184
Other		—		—		(13)		—		(13)
Net cash provided by (used in) investing activities of continuing operations		—		(182)		(479)		—		(661)
Net cash provided by (used in) investing activities of discontinued operations		—		—		(41)		—		(41)
Net cash provided by (used in) investing activities		—		(182)		(520)		—		(702)
Financing activities:
Repayment of debt		(773)		(2)		(2)		—		(777)
Distributions to noncontrolling interests		—		—		—		—		—
Dividends paid to common stockholders		(41)		(862)		—		862		(41)
Funding from noncontrolling interests		—		—		58		—		58
Payments for withholding of employee taxes related to stock-based compensation		—		(6)		—		—		(6)
Dividends paid to noncontrolling interests		—		—		(146)		—		(146)
Acquisition of noncontrolling interests		—		—		(19)		—		(19)
Net intercompany borrowings (repayments)		39		(587)		548		—		—
Other		—		—		(1)		—		(1)
Net cash provided by (used in) financing activities of continuing operations		(775)		(1,457)		438		862		(932)
Net cash provided by (used in) financing activities of discontinued operations		—		—		(319)		—		(319)
Net cash provided by (used in) financing activities		(775)		(1,457)		119		862		(1,251)
Effect of exchange rate changes on cash		—		—		4		—		4
Net change in cash and cash equivalents		—		(1,180)		1,390		—		210
Less net cash provided by (used in) Batu Hijau discontinued operations		—		—		474		—		474
		—		(1,180)		916		—		(264)
Cash and cash equivalents at beginning of period		—		1,181		1,182		—		2,363
Cash and cash equivalents at end of period	$	—	$	1	$	2,098	$	—	$	2,099

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NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)

(dollars in millions, except per share, per ounce and per pound amounts)


	At September 30, 2017
	(Issuer)		(Guarantor)		(Non-Guarantor)				Newmont
	Newmont								Mining
	Mining		Newmont		Other				Corporation
Condensed Consolidating Balance Sheet	Corporation		USA		Subsidiaries		Eliminations		Consolidated
Assets:
Cash and cash equivalents	$	—	$	—	$	2,969	$	—	$	2,969
Trade receivables		—		22		109		—		131
Other accounts receivables		—		—		116		—		116
Intercompany receivable		9,999		7,207		13,610		(30,816)		—
Investments		—		—		76		—		76
Inventories		—		166		526		—		692
Stockpiles and ore on leach pads		—		211		503		—		714
Other current assets		—		36		74		—		110
Current assets		9,999		7,642		17,983		(30,816)		4,808
Property, plant and mine development, net		19		3,053		9,131		(30)		12,173
Investments		91		9		192		—		292
Investments in subsidiaries		12,686		193		—		(12,879)		—
Stockpiles and ore on leach pads		—		638		1,158		—		1,796
Deferred income tax assets		490		65		1,223		(490)		1,288
Non-current intercompany receivable		1,826		495		950		(3,271)		—
Other non-current assets		—		224		255		—		479
Total assets	$	25,111	$	12,319	$	30,892	$	(47,486)	$	20,836
Liabilities:
Debt	$	—	$	1	$	3	$	—	$	4
Accounts payable		—		53		262		—		315
Intercompany payable		9,790		5,103		15,923		(30,816)		—
Employee-related benefits		—		112		146		—		258
Income and mining taxes		—		14		181		—		195
Other current liabilities		62		90		226		—		378
Current liabilities		9,852		5,373		16,741		(30,816)		1,150
Debt		4,040		2		4		—		4,046
Reclamation and remediation liabilities		—		253		1,813		—		2,066
Deferred income tax liabilities		—		95		1,001		(490)		606
Employee-related benefits		—		220		160		—		380
Non-current intercompany payable		81		—		3,220		(3,301)		—
Other non-current liabilities		—		20		337		—		357
Total liabilities		13,973		5,963		23,276		(34,607)		8,605
Equity:
Newmont stockholders’ equity		11,138		6,356		6,523		(12,879)		11,138
Noncontrolling interests		—		—		1,093		—		1,093
Total equity		11,138		6,356		7,616		(12,879)		12,231
Total liabilities and equity	$	25,111	$	12,319	$	30,892	$	(47,486)	$	20,836

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(dollars in millions, except per share, per ounce and per pound amounts)


	At December 31, 2016
	(Issuer)		(Guarantor)		(Non-Guarantor)				Newmont
	Newmont								Mining
	Mining		Newmont		Other				Corporation
Condensed Consolidating Balance Sheet	Corporation		USA		Subsidiaries		Eliminations		Consolidated
Assets:
Cash and cash equivalents	$	—	$	1	$	2,755	$	—	$	2,756
Trade receivables		—		21		139		—		160
Other accounts receivables		—		2		181		—		183
Intercompany receivable		7,255		6,065		11,347		(24,667)		—
Investments		—		—		56		—		56
Inventories		—		155		462		—		617
Stockpiles and ore on leach pads		—		224		539		—		763
Other current assets		—		83		59		—		142
Current assets		7,255		6,551		15,538		(24,667)		4,677
Property, plant and mine development, net		20		3,144		9,355		(34)		12,485
Investments		—		8		219		—		227
Investments in subsidiaries		13,222		537		—		(13,759)		—
Stockpiles and ore on leach pads		—		599		1,265		—		1,864
Deferred income tax assets		477		48		1,296		(490)		1,331
Non-current intercompany receivable		2,219		606		955		(3,780)		—
Other non-current assets		—		224		223		—		447
Total assets	$	23,193	$	11,717	$	28,851	$	(42,730)	$	21,031
Liabilities:
Debt	$	560	$	3	$	3	$	—	$	566
Accounts payable		—		62		258		—		320
Intercompany payable		7,720		4,795		12,152		(24,667)		—
Employee-related benefits		—		148		156		—		304
Income and mining taxes		—		13		140		—		153
Other current liabilities		62		109		236		—		407
Current liabilities		8,342		5,130		12,945		(24,667)		1,750
Debt		4,038		4		7		—		4,049
Reclamation and remediation liabilities		—		247		1,782		—		2,029
Deferred income tax liabilities		9		93		980		(490)		592
Employee-related benefits		—		269		142		—		411
Non-current intercompany payable		83		—		3,731		(3,814)		—
Other non-current liabilities		—		21		305		—		326
Total liabilities		12,472		5,764		19,892		(28,971)		9,157
Equity:
Newmont stockholders’ equity		10,721		5,953		7,806		(13,759)		10,721
Noncontrolling interests		—		—		1,153		—		1,153
Total equity		10,721		5,953		8,959		(13,759)		11,874
Total liabilities and equity	$	23,193	$	11,717	$	28,851	$	(42,730)	$	21,031

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(dollars in millions, except per share, per ounce and per pound amounts)

NOTE 24 COMMITMENTS AND CONTINGENCIES

General

Estimated losses from contingencies are accrued by a charge to income when information available prior to issuance of the financial statements indicates that it is probable that a liability could be incurred and the amount of the loss can be reasonably estimated. Legal expenses associated with the contingency are expensed as incurred. If a loss contingency is not probable or reasonably estimable, disclosure of the contingency and estimated range of loss, if determinable, is made in the financial statements when it is at least reasonably possible that a material loss could be incurred.

Operating Segments

The Company’s operating and reportable segments are identified in Note 4. Except as noted in this paragraph, all of the Company’s commitments and contingencies specifically described herein are included in Corporate and Other. The Yanacocha matters relate to the South America reportable segment. The Fronteer matters relate to the North America reportable segment.

Environmental Matters

The Company’s mining and exploration activities are subject to various laws and regulations governing the protection of the environment. These laws and regulations are continually changing and are generally becoming more restrictive. The Company conducts its operations so as to protect the public health and environment and believes its operations are in compliance with applicable laws and regulations in all material respects. The Company has made, and expects to make in the future, expenditures to comply with such laws and regulations, but cannot predict the full amount of such future expenditures.

In early 2015, the Peruvian government agency responsible for certain environmental regulations, the Ministry of the Environment (“MINAM”), issued proposed water quality criteria for designated beneficial uses which apply to mining companies, including Yanacocha. These criteria would modify the in-stream water quality criteria pursuant to which Yanacocha has been designing water treatment processes and infrastructure. In December 2015, MINAM issued the final regulation that modified the water quality standards and the Company had one year from February 15, 2016, to submit a modification to the previously approved Environmental Impact Assessment (“EIA”). On February 15, 2017, Yanacocha submitted its proposed modification to the EIA. After approval, MINAM may provide up to 3 years to develop and implement the modifications to the water management system. In the event Yanacocha is unsuccessful in implementing the modifications, MINAM could impose fines and penalties relating to potential intermittent non-compliant exceedances.

For a complete discussion of the factors that influence our reclamation obligations and the associated risks, refer to Managements’ Discussion and Analysis of Consolidated Financial Condition and Results of Operations under the heading “Critical Accounting Policies” and refer to Risk Factors under the heading “Mine closure, reclamation and remediation costs for environmental liabilities may exceed the provisions we have made” for the year ended December 31, 2016, filed February 21, 2017 on Form 10-K.

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Estimated future reclamation costs are based principally on legal and regulatory requirements. At September 30, 2017 and December 31, 2016, $1,863 and $1,792, respectively, were accrued for reclamation costs relating to currently or recently producing mineral properties in accordance with asset retirement obligation guidance. The current portions of $37 and $28 at September 30, 2017 and December 31, 2016, respectively, are included in Other current liabilities.

In addition, the Company is involved in several matters concerning environmental obligations associated with former mining activities. Generally, these matters concern developing and implementing remediation plans at the various sites involved. The Company believes that the related environmental obligations associated with these sites are similar in nature with respect to the development of remediation plans, their risk profile and the compliance required to meet general environmental standards. Based upon the Company’s best estimate of its liability for these matters, $272 and $298 were accrued for such obligations at September 30, 2017 and December 31, 2016, respectively. These amounts are included in Other current liabilities and Reclamation and remediation liabilities. Depending upon the ultimate resolution of these matters, the Company believes that it is reasonably possible that the liability for these matters could be as much as 45% greater or 0% lower than the amount accrued at September 30, 2017. The amounts accrued are reviewed periodically based upon facts and circumstances available at the time. Changes in estimates are recorded in Reclamation and remediation in the period estimates are revised.

Refer to Note 5 for further information regarding reclamation and remediation. Details about certain of the more significant matters are discussed below.

Newmont USA Limited - 100% Newmont Owned

Ross-Adams mine site. By letter dated June 5, 2007, the U.S. Forest Service (“USFS”) notified Newmont that it had expended approximately $0.3 in response costs to address environmental conditions at the Ross-Adams mine in Prince of Wales, Alaska, and requested Newmont USA Limited pay those costs and perform an Engineering Evaluation/Cost Analysis (“EE/CA”) to assess what future response activities might need to be completed at the site. Newmont agreed to perform the EE/CA, which has been provided to the USFS. During the first quarter of 2016, the USFS confirmed approval of the EE/CA, and Newmont issued written notice to the USFS certifying that all requirements of the Administrative Settlement Agreement and Order on Consent (“ASAOC”) between the USFS and Newmont have been completed. The ASAOC will be final upon USFS concurrence with the notice of completion and Newmont payment of USFS response costs. Newmont anticipates that the USFS will issue an Action Memorandum to select the preferred Removal Action alternative identified in the EE/CA. During the third quarter of 2016, Newmont received a notice of completion of work per the ASAOC from the USFS. Newmont is continuing discussions with the USFS and the U.S. Department of Justice to determine the next steps. No assurances can be made at this time with respect to the outcome of such negotiations and Newmont cannot predict the likelihood of additional expenditures related to this matter.

Dawn Mining Company LLC (“Dawn”) - 51% Newmont Owned

Midnite mine site and Dawn mill site. Dawn previously leased an open pit uranium mine, currently inactive, on the Spokane Indian Reservation in the State of Washington. The mine site is subject to regulation by agencies of the U.S. Department of Interior (the Bureau of Indian Affairs and the Bureau of Land Management), as well as the U.S. Environmental Protection Agency (“EPA”).

As per the Consent Decree approved by the U.S. District Court for the Eastern District of Washington on January 17, 2012, the following actions were required of Newmont, Dawn, the Department of the Interior and the EPA: (i) Newmont and Dawn would design, construct and implement the cleanup plan selected by the EPA in 2006 for the Midnite mine site; (ii) Newmont and Dawn would reimburse the EPA for its costs associated with overseeing the work; (iii) the Department of the Interior would contribute a lump sum amount toward past EPA costs and future costs related

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to the cleanup of the Midnite mine site; (iv) Newmont and Dawn would be responsible for all other EPA oversight costs and Midnite mine site cleanup costs; and (v) Newmont would post a surety bond for work at the site.

During 2012, the Department of Interior contributed its share of past EPA costs and future costs related to the cleanup of the Midnite mine site in a lump sum payment of $42, which Newmont classified as restricted assets, included in Other noncurrent assets on the Condensed Consolidated Balance Sheets for all periods presented. In 2016, Newmont completed the remedial design process (with the exception of the design of the water treatment plant which is on hold pending final permitting) and subsequently procured a contractor and initiated implementation of the remedial action.

The Dawn mill site is regulated by the Washington Department of Health and is in the process of being closed. Remediation at the Dawn mill site began in 2013. The earthworks component of the closure is anticipated to be completed in 2017. The remaining closure activity will consist primarily of addressing groundwater issues.

The remediation liability for the Midnite mine site and Dawn mill site is approximately $184 at September 30, 2017.

Other Legal Matters

Minera Yanacocha S.R.L. - 51.35% Newmont Owned

Choropampa. In June 2000, a transport contractor of Yanacocha spilled approximately 151 kilograms of elemental mercury near the town of Choropampa, Peru, which is located 53 miles (85 kilometers) southwest of the Yanacocha mine. Elemental mercury is not used in Yanacocha’s operations but is a by-product of gold mining and was sold to a Lima firm for use in medical instruments and industrial applications. A comprehensive health and environmental remediation program was undertaken by Yanacocha in response to the incident. In August 2000, Yanacocha paid under protest a fine of 1,740,000 Peruvian soles (approximately $0.5) to the Peruvian government. Yanacocha has entered into settlement agreements with a number of individuals impacted by the incident. As compensation for the disruption and inconvenience caused by the incident, Yanacocha entered into agreements with and provided a variety of public works in the three communities impacted by this incident. Yanacocha cannot predict the likelihood of additional expenditures related to this matter.

Additional lawsuits relating to the Choropampa incident were filed against Yanacocha in the local courts of Cajamarca, Peru, in May 2002 by over 900 Peruvian citizens. A significant number of the plaintiffs in these lawsuits entered into settlement agreements with Yanacocha prior to filing such claims. In April 2008, the Peruvian Supreme Court upheld the validity of these settlement agreements, which the Company expects to result in the dismissal of all claims brought by previously settled plaintiffs. Yanacocha has also entered into settlement agreements with approximately 350 additional plaintiffs. The claims asserted by approximately 200 plaintiffs remain. In 2011, Yanacocha was served with 23 complaints alleging grounds to nullify the settlements entered into between Yanacocha and the plaintiffs. Yanacocha has answered the complaints and the court has dismissed several of the matters and the plaintiffs have filed appeals. All appeals were referred to the Civil Court of Cajamarca, which affirmed the decisions of the lower court judge. The plaintiffs have filed appeals of such orders before the Supreme Court. Some of these appeals were dismissed by the Supreme Court in favor of Yanacocha and others are pending resolution. Yanacocha will continue to vigorously defend its position. Neither the Company nor Yanacocha can reasonably estimate the ultimate loss relating to such claims.

Administrative Actions. The Peruvian government agency responsible for environmental evaluation and inspection, Organismo Evaluacion y Fiscalizacion Ambiental (“OEFA”), conducts periodic reviews of the Yanacocha site. In 2011, 2012, 2013, 2015, 2016, and 2017, OEFA issued notices of alleged violations of OEFA standards to Yanacocha or Conga relating to past inspections. OEFA has resolved some alleged violations with minimal or no findings. In the first

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quarter of 2015 and the fourth quarter of 2016, the water authority of Cajamarca issued notices of alleged regulatory violations and resolved some allegations in early 2017 with no findings. The experience with the OEFA and the water authority is that in the case of a finding of violation, remedial action is often the outcome rather than a significant fine. The alleged OEFA violations currently range from zero to 112,670 units and the water authority alleged violations range from zero to 30,000 units, with each unit having a potential fine equivalent to approximately $0.00122 based on current exchange rates ($0 to $175). Yanacocha and Conga are responding to all notices of alleged violations, but cannot reasonably predict the outcome of the agency allegations.

Conga Project Constitutional Claim. On October 18, 2012, Marco Antonio Arana Zegarra filed a constitutional claim against the Ministry of Energy and Mines and Yanacocha requesting the Court to order the suspension of the Conga project as well as to declare not applicable the October 27, 2010, directorial resolution approving the Conga project Environmental Impact Assessment (“EIA”). On October 23, 2012, a Cajamarca judge dismissed the claims based on formal grounds finding that: (i) plaintiffs had not exhausted previous administrative proceedings; (ii) the directorial resolution approving the Conga EIA is valid, and was not challenged when issued in the administrative proceedings; (iii) there was inadequate evidence to conclude that the Conga project is a threat to the constitutional right of living in an adequate environment; and (iv) the directorial resolution approving the Conga project EIA does not guarantee that the Conga project will proceed, so there was no imminent threat to be addressed by the Court. The plaintiffs appealed the dismissal of the case. The Civil Court of the Superior Court of Cajamarca confirmed the above mentioned resolution and the plaintiff presented an appeal. On March 13, 2015, the Constitutional Court published its ruling stating that the case should be sent back to the first court with an order to formally admit the case and start the judicial process in order to review the claim and the proofs presented by the plaintiff. Yanacocha has answered the claim. Neither the Company nor Yanacocha can reasonably predict the outcome of this litigation.

Yanacocha Tax Dispute. In 2000, Yanacocha paid Buenaventura and Minas Conga S.R.L. a total of $29 to assume their respective contractual positions in mining concession agreements with Chaupiloma Dos de Cajamarca S.M.R.L. The contractual rights allowed Yanacocha the opportunity to conduct exploration on the concessions, but not a purchase of the concessions. The tax authority alleges that the payments to Buenaventura and Minas Conga S.R.L. were acquisitions of mining concessions requiring the amortization of the amounts under the Peru Mining Law over the life of the mine. Yanacocha expensed the amounts at issue in the initial year since the payments were not for the acquisition of a concession but rather these expenses represent the payment of an intangible and therefore, amortizable in a single year or proportionally for up to ten years according to Income Tax Law. In 2010, the tax court in Peru ruled in favor of Yanacocha and the tax authority appealed the issue to the judiciary. The first appellate court confirmed the ruling of the tax court in favor of Yanacocha. However, in November, 2015, a Superior Court in Peru made an appellate decision overturning the two prior findings in favor of Yanacocha. Yanacocha has appealed the Superior Court ruling to the Peru Supreme Court. The potential liability in this matter is in the form of fines and interest in an amount up to $75. While the Company has assessed that the likelihood of a ruling against Yanacocha in the Supreme Court as remote, it is not possible to fully predict the outcome of this litigation.

NWG Investments Inc. v. Fronteer Gold Inc.

In April 2011, Newmont acquired Fronteer Gold Inc. (“Fronteer”).

Fronteer acquired NewWest Gold Corporation (“NewWest Gold”) in September 2007. At the time of that acquisition, NWG Investments Inc. (“NWG”) owned approximately 86% of NewWest Gold and an individual named Jacob Safra owned or controlled 100% of NWG. Prior to its acquisition of NewWest Gold, Fronteer entered into a June 2007 lock-up agreement with NWG providing that, among other things, NWG would support Fronteer’s acquisition of NewWest Gold. At that time, Fronteer owned approximately 47% of Aurora Energy Resources Inc. (“Aurora”), which, among other things, had a uranium exploration project in Labrador, Canada.

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(dollars in millions, except per share, per ounce and per pound amounts)

NWG contends that, during the negotiations leading up to the lock-up agreement, Fronteer represented to NWG, among other things, that Aurora would commence uranium mining in Labrador by 2013, that this was a firm date, that Aurora faced no current environmental issues in Labrador and that Aurora’s competitors faced delays in commencing uranium mining. NWG further contends that it entered into the lock-up agreement and agreed to support Fronteer’s acquisition of NewWest Gold in reliance upon these purported representations. On October 11, 2007, less than three weeks after the Fronteer-NewWest Gold transaction closed, a member of the Nunatsiavut Assembly introduced a motion calling for the adoption of a moratorium on uranium mining in Labrador. On April 8, 2008, the Nunatsiavut Assembly adopted a three-year moratorium on uranium mining in Labrador. NWG contends that Fronteer was aware during the negotiations of the NWG/Fronteer lock-up agreement that the Nunatsiavut Assembly planned on adopting this moratorium and that its adoption would preclude Aurora from commencing uranium mining by 2013, but Fronteer nonetheless fraudulently induced NWG to enter into the lock-up agreement.

On September 24, 2012, NWG served a summons and complaint on the Company, and then amended the complaint to add Newmont Canada Holdings ULC as a defendant. The complaint also named Fronteer Gold Inc. and Mark O’Dea as defendants. The complaint sought rescission of the merger between Fronteer and NewWest Gold and $750 in damages. In August 2013 the Supreme Court of New York, New York County issued an order granting the defendants’ motion to dismiss on forum non conveniens. Subsequently, NWG filed a notice of appeal of the decision and then a notice of dismissal of the appeal on March 24, 2014.

On February 26, 2014, NWG filed a lawsuit in Ontario Superior Court of Justice against Fronteer Gold Inc., Newmont Mining Corporation, Newmont Canada Holdings ULC, Newmont FH B.V. and Mark O’Dea. The Ontario complaint is based upon substantially the same allegations contained in the New York lawsuit with claims for fraudulent and negligent misrepresentation. NWG seeks disgorgement of profits since the close of the NWG deal on September 24, 2007 and damages in the amount of C$1.2 billion. Newmont, along with other defendants, served the plaintiff with its statement of defense on October 17, 2014. Newmont intends to vigorously defend this matter, but cannot reasonably predict the outcome.

Investigations

We occasionally identify or are apprised of information or allegations that certain employees, affiliates, agents or associated persons may have engaged in unlawful conduct for which we might be held responsible. We recently conducted an investigation, with the assistance of outside counsel, relating to certain business activities of the Company and its affiliates and contractors in countries outside the U.S. The investigation included a review of compliance with the requirements of the U.S. Foreign Corrupt Practices Act and other applicable laws and regulations. The Company worked with the U.S. Securities and Exchange Commission (“SEC”) and the U.S. Department of Justice with respect to the investigation. In March 2016, the Company entered into a one-year agreement with the U.S. SEC tolling the statute of limitations relating to the investigation, and in April 2016, entered into a similar agreement with the U.S. Department of Justice. Both of the initial tolling agreements were effective through October 29, 2016. In September 2016, the Company agreed to extend its tolling agreement with the Department of Justice through April 2017, and agreed to a similar extension with the SEC in October 2016.

In late February 2017, the Company received a declination letter from the SEC relating to this investigation indicating that they do not intend to recommend an enforcement action. In June 2017, the Company received a similar letter from the U.S. Department of Justice acknowledging the Company’s cooperation in the investigation and indicating that the Department of Justice had closed its inquiry into the matter.

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NEWMONT MINING CORPORATION

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)

(dollars in millions, except per share, per ounce and per pound amounts)

Other Commitments and Contingencies

The Company has minimum royalty obligations on one of its producing mines in Nevada for the life of the mine. Amounts paid as a minimum royalty (where production royalties are less than the minimum obligation) in any year are recoverable in future years when the minimum royalty obligation is exceeded. Although the minimum royalty requirement may not be met in a particular year, the Company expects that over the mine life, gold production will be sufficient to meet the minimum royalty requirements. Royalty payments payable, net of recoverable amounts, are $30 in 2017, $30 in 2018, $31 in 2019, $33 in 2020, $34 in 2021 and $35 thereafter.

On June 25, 2009, the Company completed the acquisition of the remaining 33.33% interest in Boddington from AngloGold Ashanti Australia Limited (“AngloGold”). Consideration for the acquisition consisted of $982 and a contingent royalty capped at $100, equal to 50% of the average realized operating margin (Revenue less Costs applicable to sales on a by-product basis), if any, exceeding $600 per ounce, payable quarterly beginning in the second quarter of 2010 on one-third of gold sales from Boddington. At the acquisition date, the Company estimated the fair value of the contingent consideration at $62. At September 30, 2017 and December 31, 2016, the estimated fair value of the unpaid contingent consideration was approximately $13 and $14, respectively. Changes to the estimated fair value resulting from periodic revaluations are recorded to Other expense, net. This contingent royalty is capped at $100 in aggregate payments, of which $87 has been paid to date. During the nine months ended September 30, 2017 and 2016 the Company paid $9 and $-, respectively. The range of remaining undiscounted amounts the Company could pay is between $0 and $13 and the Company expects to pay $6 in the next 12 months.

As part of its ongoing business and operations, the Company and its affiliates are required to provide surety bonds, bank letters of credit and bank guarantees as financial support for various purposes, including environmental remediation, reclamation, exploration permitting, workers compensation programs and other general corporate purposes. At September 30, 2017 and December 31, 2016, there were $2,323 and $2,227, respectively, of outstanding letters of credit, surety bonds and bank guarantees. The obligations associated with these instruments are generally related to performance requirements that the Company addresses through its ongoing operations. As the specific requirements are met, the beneficiary of the associated instrument cancels and/or returns the instrument to the issuing entity. Certain of these instruments are associated with operating sites with long-lived assets and will remain outstanding until closure. Generally, bonding requirements associated with environmental regulation are becoming more restrictive. However, the Company believes it is in compliance with all applicable bonding obligations and will be able to satisfy future bonding requirements through existing or alternative means, as they arise.

Newmont is from time to time involved in various legal proceedings related to its business. Except in the above described proceedings, management does not believe that adverse decisions in any pending or threatened proceeding or that amounts that may be required to be paid by reason thereof will have a material adverse effect on the Company’s financial condition or results of operations.

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ITEM 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS (dollars in millions, except per share, per ounce and per pound amounts)

The following Management’s Discussion and Analysis (“MD&A”) provides information that management believes is relevant to an assessment and understanding of the consolidated financial condition and results of operations of Newmont Mining Corporation and its subsidiaries (collectively, “Newmont,” the “Company,” “our” and “we”). We use certain non-GAAP financial measures in our MD&A. For a detailed description of each of the non-GAAP measures used in this MD&A, please see the discussion under “Non-GAAP Financial Measures” beginning on page 72. References to “A$” refers to Australian currency.

This item should be read in conjunction with our interim unaudited Condensed Consolidated Financial Statements and the notes thereto included in this quarterly report. Additionally, the following discussion and analysis should be read in conjunction with Management’s Discussion and Analysis of Consolidated Financial Condition and Results of Operations and the consolidated financial statements included in Part II of our Annual Report on Form 10-K for the year ended December 31, 2016 filed February 21, 2017.

Overview

Newmont is one of the world’s largest gold producers and is the only gold company included in the S&P 500 Index and Fortune 500. We have been included in the Dow Jones Sustainability Index-World for 11 consecutive years and have adopted the World Gold Council’s Conflict-Free Gold Policy. We are also engaged in the exploration for and acquisition of gold and copper properties. We have significant operations and/or assets in the United States (“U.S.”), Australia, Peru, Ghana and Suriname.

On November 2, 2016, Newmont completed the sale of its 48.5% economic interest in PT Newmont Nusa Tenggara (“PTNNT”), which operated the Batu Hijau copper and gold mine (“Batu Hijau”) in Indonesia. As a result, Newmont presents Batu Hijau as a discontinued operation for all periods presented. In the following discussion and analysis, the operating statistics, results of operations, cash flows and financial condition that we present and discuss are those of our continuing operations unless otherwise indicated. For additional information regarding our discontinued operations, see Note 3 to the Condensed Consolidated Financial Statements and the discussion in our Results of Consolidated Operations below.

We continue to focus on improving safety and efficiency at our operations, maintaining leading environmental, social and governance practices, and building a stronger portfolio of longer-life, lower cost mines to generate the financial flexibility we need to fund our best projects, reduce debt, and return cash to shareholders.

Consolidated Financial Results

The details of our Net income (loss) from continuing operations attributable to Newmont stockholders are set forth below:


	Three Months Ended
	September 30,				Increase
	2017		2016		(decrease)
Net income (loss) from continuing operations attributable to Newmont stockholders	$	213	$	169	$	44
Net income (loss) from continuing operations attributable to Newmont stockholders per common share, diluted	$	0.39	$	0.32	$	0.07

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	Nine Months Ended
	September 30,				Increase
	2017		2016		(decrease)
Net income (loss) from continuing operations attributable to Newmont stockholders	$	474	$	171	$	303
Net income (loss) from continuing operations attributable to Newmont stockholders per common share, diluted	$	0.88	$	0.32	$	0.56

The increases in Net income (loss) from continuing operations attributable to Newmont stockholders for the three and nine months ended September 30, 2017, compared to the same periods in 2016, are primarily due to new production at Merian and Long Canyon and lower income and mining taxes, partially offset by slightly lower production at various mine sites and lower average realized gold prices. The nine-month comparison was also impacted by an increase in gold production from the CC&V expansion completed in the first quarter of 2016, adverse weather conditions impacting production at Tanami and Yanacocha during the first quarter of 2017 and a prior-year gain from the sale of the Company’s investment in Regis Resources Ltd. (“Regis”) in March 2016.

The following is a summary of Sales:


	Three Months Ended				Nine Months Ended
	September 30,				September 30,
	2017		2016		2017		2016
Gold
North America:
Carlin	$	330	$	362	$	862	$	864
Phoenix		68		61		188		187
Twin Creeks		103		129		352		432
Long Canyon (1)		70		—		166		—
CC&V		140		152		452		361
		711		704		2,020		1,844
South America:
Yanacocha		176		195		504		600
Merian (2)		162		—		445		—
		338		195		949		600
Australia:
Boddington		236		287		726		741
Tanami		148		151		363		450
Kalgoorlie		121		120		338		348
		505		558		1,427		1,539
Africa:
Ahafo		100		115		326		331
Akyem		145		156		464		437
		245		271		790		768
		1,799		1,728		5,186		4,751
Copper
North America:
Phoenix		21		20		71		63
Australia:
Boddington		59		43		156		108
		80		63		227		171
	$	1,879	$	1,791	$	5,413	$	4,922

⁽¹⁾

Commercial production at Long Canyon was achieved in November 2016.

⁽²⁾

Commercial production at Merian was achieved in October 2016.

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The following analysis summarizes consolidated gold sales:


	Three Months Ended				Nine Months Ended
	September 30,				September 30,
	2017		2016		2017		2016
Consolidated gold sales:
Gross before provisional pricing	$	1,806	$	1,736	$	5,201	$	4,754
Provisional pricing mark-to-market		2		2		9		24
Gross after provisional pricing		1,808		1,738		5,210		4,778
Treatment and refining charges		(9)		(10)		(24)		(27)
Net	$	1,799	$	1,728	$	5,186	$	4,751
Consolidated gold ounces sold (thousands)		1,411		1,300		4,151		3,766
Average realized gold price (per ounce):
Gross before provisional pricing	$	1,281	$	1,334	$	1,253	$	1,262
Provisional pricing mark-to-market		1		2		2		6
Gross after provisional pricing		1,282		1,336		1,255		1,268
Treatment and refining charges		(6)		(7)		(5)		(7)
Net	$	1,276	$	1,329	$	1,250	$	1,261

The change in consolidated gold sales is due to:


	Three Months Ended		Nine Months Ended
	September 30,		September 30,
	2017 vs. 2016		2017 vs. 2016
Change in consolidated ounces sold	$	146	$	486
Change in average realized gold price		(76)		(54)
Change in treatment and refining charges		1		3
	$	71	$	435

Gold sales increased 4% and 9% during the three and nine months ended September 30, 2017, respectively, compared to the same periods in 2016, primarily due to new production at Merian and Long Canyon, partially offset by slightly lower production at various mine sites and lower average realized prices. The nine-month comparison was also impacted by an increase in production from the CC&V expansion completed in the first quarter of 2016 and adverse weather conditions impacting production at Tanami and Yanacocha during the first quarter of 2017.

For further discussion regarding changes in volumes, see Results of Consolidated Operations below.

The following analysis summarizes consolidated copper sales:


	Three Months Ended				Nine Months Ended
	September 30,				September 30,
	2017		2016		2017		2016
Consolidated copper sales:
Gross before provisional pricing	$	77	$	67	$	228	$	183
Provisional pricing mark-to-market		6		—		9		—
Gross after provisional pricing		83		67		237		183
Treatment and refining charges		(3)		(4)		(10)		(12)
Net	$	80	$	63	$	227	$	171
Consolidated copper pounds sold (millions)		26		30		84		84
Average realized copper price (per pound):
Gross before provisional pricing	$	2.98	$	2.18	$	2.73	$	2.17
Provisional pricing mark-to-market		0.20		—		0.10		—
Gross after provisional pricing		3.18		2.18		2.83		2.17
Treatment and refining charges		(0.12)		(0.14)		(0.12)		(0.14)
Net	$	3.06	$	2.04	$	2.71	$	2.03

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The change in consolidated copper sales is due to:


	Three Months Ended		Nine Months Ended
	September 30,		September 30,
	2017 vs. 2016		2017 vs. 2016
Change in consolidated pounds sold	$	(11)	$	—
Change in average realized copper price		27		54
Change in treatment and refining charges		1		2
	$	17	$	56

Copper sales increased 27% and 33% during the three and nine months ended September 30, 2017, respectively, compared to the same periods in 2016, primarily due to higher average realized prices, partially offset by lower production at Phoenix.

For further discussion regarding changes in volumes, see Results of Consolidated Operations below.

The following is a summary of Costs applicable to sales and Depreciation and amortization:


	Costs Applicable				Depreciation and				Costs Applicable				Depreciation and
	to Sales				Amortization				to Sales				Amortization
	Three Months Ended				Three Months Ended				Nine Months Ended				Nine Months Ended
	September 30,				September 30,				September 30,				September 30,
	2017		2016		2017		2016		2017		2016		2017		2016
Gold
North America:
Carlin	$	216	$	212	$	60	$	51	$	579	$	585	$	156	$	143
Phoenix		48		30		13		10		137		118		36		37
Twin Creeks		59		52		16		10		167		170		46		36
Long Canyon (1)		17		—		24		—		42		—		55		—
CC&V		75		65		35		32		219		156		97		78
		415		359		148		103		1,144		1,029		390		294
South America:
Yanacocha		150		148		38		92		403		396		108		220
Merian (2)		62		—		22		—		174		—		69		1
		212		148		60		92		577		396		177		221
Australia:
Boddington		130		139		26		30		399		391		81		82
Tanami		72		57		17		20		180		180		48		62
Kalgoorlie		64		57		5		5		171		189		14		14
		266		253		48		55		750		760		143		158
Africa:
Ahafo		57		95		14		30		193		212		52		62
Akyem		67		63		40		32		202		174		114		93
		124		158		54		62		395		386		166		155
		1,017		918		310		312		2,866		2,571		876		828
Copper
North America:
Phoenix		11		32		3		8		45		76		12		20
Australia:
Boddington		25		33		5		6		74		89		15		17
		36		65		8		14		119		165		27		37
Other
Corporate and other		—		—		9		9		—		—		25		27
	$	1,053	$	983	$	327	$	335	$	2,985	$	2,736	$	928	$	892

⁽¹⁾

Commercial production at Long Canyon was achieved in November 2016.

⁽²⁾

Commercial production at Merian was achieved in October 2016.

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The details of our Costs applicable to sales are set forth below:


	Three Months Ended
	September 30,				Increase		Percent
	2017		2016		(decrease)		Change
Gold	$	1,017	$	918	$	99	11	%
Copper		36		65		(29)	(45)
	$	1,053	$	983	$	70	7	%


	Nine Months Ended
	September 30,				Increase		Percent
	2017		2016		(decrease)		Change
Gold	$	2,866	$	2,571	$	295	11	%
Copper		119		165		(46)	(28)
	$	2,985	$	2,736	$	249	9	%

The increases in Costs applicable to sales for gold during the three and nine months ended September 30, 2017, compared to the same periods in 2016, are primarily due to new production at Merian and Long Canyon and higher costs per unit sold at Yanacocha from lower mill grade, partially offset by lower stockpile and leach pad adjustments. The nine-month comparison was also impacted by an increase in gold production from the CC&V expansion completed in the first quarter of 2016 and adverse weather conditions impacting production at Tanami and Yanacocha during the first quarter of 2017.

The decreases in Costs applicable to sales for copper during the three and nine months ended September 30, 2017, compared to the same periods in 2016, are primarily due to a lower co-product allocation of costs to copper and lower production at Phoenix.

For discussion regarding variations in operations, see Results of Consolidated Operations below.

The details of our Depreciation and amortization are set forth below:


	Three Months Ended
	September 30,				Increase		Percent
	2017		2016		(decrease)		Change
Gold	$	310	$	312	$	(2)	(1)	%
Copper		8		14		(6)	(43)
Other		9		9		—	—
	$	327	$	335	$	(8)	(2)	%


	Nine Months Ended
	September 30,				Increase		Percent
	2017		2016		(decrease)		Change
Gold	$	876	$	828	$	48	6	%
Copper		27		37		(10)	(27)
Other		25		27		(2)	(7)
	$	928	$	892	$	36	4	%

The changes in Depreciation and amortization for gold during the three and nine months ended September 30, 2017, compared to the same periods in 2016, are primarily due to new production at Merian and Long Canyon, partially offset by lower stockpile and leach pad adjustments and the impacts of a significant impairment charge taken in December 2016, reducing Property, plant and mine development, net balances at Yanacocha. The nine-month comparison was also impacted by an increase in gold production from the CC&V expansion completed in the first quarter of 2016 and adverse weather conditions impacting production at Tanami and Yanacocha during the first quarter of 2017.

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The decreases in Depreciation and amortization for copper during the three and nine months ended September 30, 2017, compared to the same periods in 2016, are primarily due to lower production at Phoenix and a lower co-product allocation of costs to copper.

For discussion regarding variations in operations, see Results of Consolidated Operations below.

Reclamation and remediation increased by $4 and $36 during the three and nine months ended September 30, 2017, respectively, compared to the same periods in 2016, primarily due to higher reclamation accretion from an increase in Reclamation and remediation liabilities associated with revisions to Yanacocha’s long-term mining and closure plans in December 2016. The nine months ended September 30, 2017 were also higher compared to the same period in 2016 due to updated reclamation liability assumptions at Yanacocha regarding water treatment costs on non-operating leach pads of $15 during the second quarter of 2017.

Exploration increased by $9 and $28 during the three and nine months ended September 30, 2017, respectively, compared to the same periods in 2016, primarily due to increased exploration activity at various projects as we continue to focus on developing future reserves.

Advanced projects, research and development increased (decreased) by $7 and $(6) during the three and nine months ended September 30, 2017, respectively, compared to the same periods in 2016, primarily due to higher consulting costs in North America related to process improvements and cost reduction efforts and the advancement of the Yanacocha Sulfides, Sabajo, Quecher Main, Ahafo North and Tanami Expansion 2 projects, partially offset by the completion of the Merian Project in October 2016.

Other expense, net decreased by $20 and $22 during the three and nine months ended September 30, 2017, respectively, compared to the same periods in 2016, primarily due to favorable adjustments to the contingent consideration and related liabilities associated with the acquisition of the final 33.33% interest in Boddington in June 2009 and lower severance and outsourcing costs, primarily at Corporate and Yanacocha.

Other income, net increased (decreased) by $14 and $(61) during the three and nine months ended September 30, 2017, respectively, compared to the same periods in 2016. For the three-month comparison, the increase is primarily due to an increase in interest income. For the nine-month comparison, the decrease is primarily due to a prior-year gain of $103 from the sale of the Company’s investment in Regis in March 2016, partially offset by a gain of $15 from the exchange of the Company’s 31% interest in the Fort á la Corne joint venture for shares in Shore Gold Inc. (“Shore Gold”) and business interruption insurance proceeds of $13 recorded in June 2017 associated with the heavy rainfall at Tanami during the first quarter of 2017.

Interest expense, net decreased by $8 and $17 during the three and nine months ended September 30, 2017, respectively, compared to the same periods in 2016, primarily due to reduced debt balances from the extinguishment of the 2019 term loan in August 2016, the partial repayment of the 2022 Senior Notes in November 2016 and the repayment of the 2017 Convertible Senior Notes in July 2017, partially offset by lower capitalized interest from the completion of the Long Canyon and Merian projects. The nine-month comparison was also impacted by reduced debt balances from the partial repayment of the 2019 and 2039 Senior Notes in March 2016.

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Income and mining tax expense (benefit) decreased by $18 and $206 during the three and nine months ended September 30, 2017, respectively, compared to the same periods in 2016. A reconciliation and comparison of the periods is shown below:


	Three Months Ended September 30,
	2017				2016				Variance
Income before income and mining tax and other items			$	276			$	223

Tax at statutory rate	35	%	$	97	35	%	$	78
Reconciling items:
Percentage depletion	3			10	(5)			(11)	8	%
Change in valuation allowance on deferred tax assets	(14)			(39)	(2)			(5)	(12)
Mining and other taxes	—			(1)	6			13	(6)
U.S. tax effect of noncontrolling interest attributable to non-U.S. investees	2			5	4			10	(2)
Tax impact on sale of assets	(1)			(2)	—			—	(1)
Other	1			2	2			5	(1)
Income and mining tax expense	26	%	$	72	40	%	$	90	(14)	%


	Nine Months Ended September 30,
	2017				2016				Variance
Income (loss) before income and mining tax and other items			$	805			$	672

Tax at statutory rate	35	%	$	282	35	%	$	235
Reconciling items:
Percentage depletion	(8)			(64)	(7)			(47)	(1)	%
Change in valuation allowance on deferred tax assets	12			100	49			330	(37)
Mining and other taxes	4			34	6			41	(2)
U.S. tax effect of noncontrolling interest attributable to non-U.S. investees	1			5	3			20	(2)
Tax impact on sale of assets	(1)			(7)	(5)			(35)	4
Other	—			(1)	2			11	(2)
Income and mining tax expense	43	%	$	349	83	%	$	555	(40)	%

Applicable accounting standards require that Newmont estimate an annual effective tax rate and apply that rate to each year-to-date interim period. Variations in customary income tax expense relationships can occur between interim periods when applying this standard. In addition, the relative proportions of the Company’s various jurisdictional operating profits and losses will influence the effect of certain items, such as percentage depletion, on the Company’s effective tax rate.

During the three and nine months ended September 30, 2017, the Company’s effective tax rate is driven by a number of factors as illustrated in the table above. The decreases in the effective tax rate are primarily due to lower charges to the Company’s valuation allowance on tax credits and lower mining taxes, partially offset by a decrease in the benefit from percentage depletion as compared to the same periods in 2016. The decreases in valuation allowance are due to a greater ability to utilize tax credits and a significant 2016 addition to valuation allowance precipitated by a tax restructuring and the carryback of losses to prior years. Changes to the impacts from percentage depletion and mining taxes are a result of differences in the jurisdictional mix of income and the effect of the interim reporting rules that govern the accounting for income taxes.

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There are a number of factors that can potentially impact the Company’s effective tax rate, including the geographic distribution of income, the non-recognition of tax assets, percentage depletion, changes in tax laws and the impact of specific transactions and assessments. For a complete discussion of the factors that influence our effective tax rate, see Management’s Discussion and Analysis of Consolidated Financial Condition and Results of Operations for the year ended December 31, 2016 filed February 21, 2017 on Form 10-K.

Due to the factors discussed above and the sensitivity of the Company’s income tax expense and effective tax rate to these factors, it is expected that the effective tax rate will fluctuate, sometimes significantly, in future periods.

Net income (loss) from discontinued operations details are set forth below:


	Three Months Ended
	September 30,				Increase		Percent
	2017		2016		(decrease)		Change
Holt royalty obligation	$	(7)	$	(19)	$	12	(63)	%
Batu Hijau operations		—		148		(148)	N.M.
Loss on classification as held for sale		—		(577)		577	N.M.
	$	(7)	$	(448)	$	441	(98)	%


	Nine Months Ended
	September 30,				Increase		Percent
	2017		2016		(decrease)		Change
Holt royalty obligation	$	(45)	$	(72)	$	27	(38)	%
Batu Hijau operations		—		424		(424)	N.M.
Loss on classification as held for sale		—		(577)		577	N.M.
	$	(45)	$	(225)	$	180	(80)	%

N.M. – Not meaningful.

During the three months ended September 30, 2017, the Holt royalty obligation increased the net loss from discontinued operations primarily due to an increase in gold price. During the nine months ended September 30, 2017, the Holt royalty obligation increased the net loss from discontinued operations primarily due to an increase in gold price, a decrease in discount rate and an increase in expected production based on gold reserves and resources from Kirkland Lake Gold Ltd., which were updated in March 2017. During the three and nine months ended September 30, 2016, the Holt royalty obligation increased the net loss from discontinued operations due to an increase in gold prices and decrease in discount rates.

For additional information regarding our discontinued operations, see Note 3 to our Condensed Consolidated Financial Statements. For information regarding Batu Hijau’s 2016 production results, see the Discontinued operations section in Results of Consolidated Operations below.

Net loss (income) attributable to noncontrolling interests from continuing operations during the three and nine months ended September 30, 2017 were losses of $8 and $22, respectively, compared to $34 and $62 in the same periods of 2016. The decreases are primarily due to new production at Merian offsetting losses incurred at Yanacocha.

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Results of Consolidated Operations


	Gold or Copper		Costs Applicable				Depreciation and				All-In Sustaining
	Produced		to Sales (1)				Amortization				Costs (2)
	2017	2016	2017		2016		2017		2016		2017		2016
Three Months Ended September 30,
Gold	(ounces in thousands)		($ per ounce sold)				($ per ounce sold)				($ per ounce sold)
North America	573	540	$	742	$	678	$	265	$	194	$	912	$	831
South America	271	147		806		1,022		240		657		1,061		1,253
Australia	406	429		670		598		126		130		821		752
Africa	191	202		646		778		281		310		802		970
Total/Weighted-Average for continuing operations	1,441	1,318	$	721	$	706	$	226	$	245	$	943	$	925
Attributable to Newmont	1,339	1,246

Copper	(pounds in millions)		($ per pound sold)				($ per pound sold)				($ per pound sold)
North America	7	11	$	1.57	$	3.44	$	0.43	$	0.88	$	1.71	$	4.11
Australia	20	21		1.32		1.56		0.26		0.31		1.63		1.90
Total/Weighted-Average for continuing operations	27	32	$	1.38	$	2.14	$	0.30	$	0.48	$	1.65	$	2.57

Copper	(tonnes in thousands)
North America	3	5
Australia	9	10
Total/Weighted-Average for continuing operations	12	15


	Gold or Copper		Costs Applicable				Depreciation and				All-In Sustaining
	Produced		to Sales (1)				Amortization				Costs (2)
	2017	2016	2017		2016		2017		2016		2017		2016
Nine Months Ended September 30,
Gold	(ounces in thousands)		($ per ounce sold)				($ per ounce sold)				($ per ounce sold)
North America	1,655	1,473	$	707	$	702	$	242	$	201	$	884	$	863
South America	755	483		760		828		246		481		995		1,163
Australia	1,167	1,245		658		627		130		135		793		766
Africa	631	609		624		631		262		254		782		800
Total/Weighted-Average for continuing operations	4,208	3,810	$	690	$	682	$	217	$	227	$	909	$	910
Attributable to Newmont	3,925	3,575

Copper	(pounds in millions)		($ per pound sold)				($ per pound sold)				($ per pound sold)
North America	26	32	$	1.67	$	2.49	$	0.44	$	0.66	$	1.96	$	2.90
Australia	61	57		1.30		1.66		0.26		0.33		1.58		1.96
Total/Weighted-Average for continuing operations	87	89	$	1.42	$	1.96	$	0.32	$	0.45	$	1.70	$	2.30

Copper	(tonnes in thousands)
North America	12	15
Australia	28	26
Total/Weighted-Average for continuing operations	40	41

⁽¹⁾

Excludes Depreciation and amortization and Reclamation and remediation.

⁽²⁾

All-In Sustaining Costs is a non-GAAP financial measure. See Non-GAAP Financial Measures beginning on page 72.

Three months ended September 30, 2017 compared to 2016

Consolidated gold production increased 9% due to new production at Long Canyon in North America and Merian in South America, partially offset by lower mill throughput at Twin Creeks in North America, lower ore grade milled and lower mill recoveries at Yanacocha in South America, lower ore grade mined and milled at Boddington in Australia and lower mill throughput at Ahafo in Africa.

Consolidated copper production decreased by 16% primarily due to lower ore grade milled and lower leach

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placement at Phoenix in North America, and lower ore grade milled at Boddington in Australia.

Costs applicable to sales per consolidated gold ounce increased 2% due to higher direct operating costs, partially offset by higher gold ounces sold and lower stockpile and leach pad inventory adjustments. Costs applicable to sales per consolidated copper pound decreased 36% primarily due to a lower co-product allocation of costs to copper, partially offset by lower copper pounds sold.

Depreciation and amortization per consolidated gold ounce decreased 8% primarily due to higher gold ounces sold, a lower asset balance at Yanacocha resulting from an impairment recorded in December 2016 and lower leach pad inventory adjustments at Yanacocha. Depreciation and amortization per consolidated copper pound decreased 38% due to a lower co-product allocation of costs to copper, partially offset by lower copper pounds sold.

All-in sustaining costs per consolidated gold ounce increased 2% primarily due to higher costs applicable to sales per ounce and higher exploration and advanced projects spend, partially offset by lower sustaining capital spend. All-in sustaining costs per consolidated copper pound decreased 36% primarily due to lower costs applicable to sales per pound and lower sustaining capital spend.

Nine months ended September 30, 2017 compared to 2016

Consolidated gold production increased 10% due to new production at Long Canyon, higher ore placement and recoveries at Valley Leach Fill 2 at CC&V, and higher ore grade milled at Carlin and Phoenix in North America, new production at Merian in South America, and higher mill grade, throughput and recovery at Akyem in Africa, partially offset by lower ore grade mined and milled, and lower mill throughput at Tanami. Throughput at Tanami was lower due to the mill being placed into care and maintenance for the majority of February 2017 following record high rainfall that blocked transport routes, limiting access to fuel and other resources.

Consolidated copper production decreased by 2% primarily due to lower leach placement and lower mill throughput at Phoenix in North America, partially offset by higher ore grades mined and milled and higher mill throughput at Boddington in Australia.

Costs applicable to sales per consolidated gold ounce increased 1% primarily due to higher direct operating costs, partially offset by higher gold ounces sold and lower leach pad inventory adjustments. Costs applicable to sales per consolidated copper pound decreased 28% primarily due to a lower co-product allocation of costs to copper and higher copper pounds sold.

Depreciation and amortization per consolidated gold ounce decreased 4% primarily due to higher ounces sold, a lower asset balance at Yanacocha resulting from an impairment recorded in December 2016, and lower leach pad inventory adjustments. Depreciation and amortization per consolidated copper pound decreased 29% due to a lower co-product allocation of costs to copper and higher copper pounds sold.

All-in sustaining costs per consolidated gold ounce were in line with prior year. All-in sustaining costs per consolidated copper pound decreased 26% primarily due to lower costs applicable to sales per pound.

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North America Operations


	Gold or Copper		Costs Applicable				Depreciation and				All-In Sustaining
	Produced		to Sales (1)				Amortization				Costs (2)
	2017	2016	2017		2016		2017		2016		2017		2016
Three Months Ended September 30,
Gold	(ounces in thousands)		($ per ounce sold)				($ per ounce sold)				($ per ounce sold)
Carlin	268	273	$	834	$	781	$	232	$	185	$	992	$	949
Phoenix	58	57		889		637		241		203		1,037		766
Twin Creeks	82	96		728		532		198		111		926		656
Long Canyon (3)	56	—		309		—		436		—		327		—
CC&V	109	114		682		574		318		280		791		646
Total/Weighted-Average (4)	573	540	$	742	$	678	$	265	$	194	$	912	$	831

Copper	(pounds in millions)		($ per pound sold)				($ per pound sold)				($ per pound sold)
Phoenix	7	11	$	1.57	$	3.44	$	0.43	$	0.88	$	1.71	$	4.11

Copper	(tonnes in thousands)
Phoenix	3	5


	Gold or Copper		Costs Applicable				Depreciation and				All-In Sustaining
	Produced		to Sales (1)				Amortization				Costs (2)
	2017	2016	2017		2016		2017		2016		2017		2016
Nine Months Ended September 30,
Gold	(ounces in thousands)		($ per ounce sold)				($ per ounce sold)				($ per ounce sold)
Carlin	700	683	$	840	$	856	$	226	$	209	$	1,055	$	1,044
Phoenix	169	158		884		782		232		245		1,058		920
Twin Creeks	287	346		592		489		163		105		734		591
Long Canyon (3)	133	—		318		—		417		—		341		—
CC&V	366	286		607		551		269		274		690		611
Total/Weighted-Average (4)	1,655	1,473	$	707	$	702	$	242	$	201	$	884	$	863

Copper	(pounds in millions)		($ per pound sold)				($ per pound sold)				($ per pound sold)
Phoenix	26	32	$	1.67	$	2.49	$	0.44	$	0.66	$	1.96	$	2.90

Copper	(tonnes in thousands)
Phoenix	12	15

⁽¹⁾

Excludes Depreciation and amortization and Reclamation and remediation.

⁽²⁾

All-In Sustaining Costs is a non-GAAP financial measure. See Non-GAAP Financial Measures beginning on page 72.

⁽³⁾

Long Canyon reached commercial production in November 2016.

⁽⁴⁾

All-In Sustaining Costs and Depreciation and amortization include expense for other regional projects.

Three months ended September 30, 2017 compared to 2016

Carlin, USA. Gold production decreased 2% primarily due to lower ore grade mined. Costs applicable to sales per ounce increased 7% due to higher stockpile and leach-pad inventory adjustments and lower ounces sold. Depreciation and amortization per ounce increased 25% primarily due to lower ounces sold and higher stockpile and leach pad inventory adjustments. All-in sustaining costs per ounce increased 5% primarily due to higher costs applicable to sales per ounce partially offset by lower sustaining capital spend.

Phoenix, USA. Gold production increased 2% primarily due to higher leach production from increased ore placement from the Brooks pit at Lone Tree. Copper production decreased 36% primarily due to lower mill grade and lower leach placement. Costs applicable to sales per ounce increased 40% primarily due to a higher co-product allocation of costs to gold. Costs applicable to sales per pound decreased 54% primarily due to a copper leach pad inventory adjustment in the prior year and a lower co-product allocation of costs to copper. Depreciation and amortization per ounce increased 19% primarily due to a higher co-product allocation of costs to gold. Depreciation and amortization per pound decreased 51% primarily due to a copper leach pad inventory adjustment in the prior year, lower

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amortization rates and a lower co-product allocation of costs to copper. All-in sustaining costs per ounce increased 35% primarily due to higher cost applicable to sales per ounce. All-in sustaining costs per pound decreased 58% primarily due to lower costs applicable to sales per pound.

Twin Creeks, USA. Gold production decreased 15% due to lower mill throughput. Costs applicable to sales per ounce increased 37% due to lower ounces sold, higher direct operating costs, and higher stockpile and leach-pad inventory adjustments as a result of a planned stripping campaign at the Vista pit. Depreciation and amortization per ounce increased 78% primarily due to lower ounces sold and higher stockpile and leach-pad inventory adjustments. All-in sustaining costs per ounce increased 41% due to higher costs applicable to sales per ounce and higher sustaining capital spend.

Long Canyon, USA. Long Canyon achieved commercial production in November 2016.

CC&V, USA. Gold production decreased 4% primarily due to lower ore grade mined and milled, and lower mill recovery, partially offset by higher ore placement and recoveries at Valley Leach Fill 2 leach pad. Costs applicable to sales per ounce increased 19% primarily due to lower grade mined and lower mill recovery partially offset by lower direct operating cost. Depreciation and amortization per ounce increased 14% primarily due to lower ounces sold. All-in sustaining costs per ounce increased 22% primarily due to higher costs applicable to sales per ounce and higher sustaining capital spend.

Nine months ended September 30, 2017 compared to 2016

Carlin, USA. Gold production increased 2% primarily due to higher ore grade mined at Leeville partially offset by halted mining activity at the Silverstar mine due to the geotechnical issues in the fourth quarter of 2016. Costs applicable to sales per ounce decreased 2% due to higher ounces sold. Depreciation and amortization per ounce increased 8% primarily due to lower surface grades mined resulting in inventory drawdowns. All-in sustaining costs per ounce increased 1% primarily due to higher sustaining capital spend partially offset by lower costs applicable to sales per ounce.

Phoenix, USA. Gold production increased 7% due to higher leach placement from mining in the Brooks pit at Lone Tree. Copper production decreased 19% primarily due to lower copper leach placement and lower mill throughput and recovery. Costs applicable to sales per ounce increased 13% primarily due to a higher co-product allocation of costs to gold partially offset by higher ounces sold. Costs applicable to sales per pound decreased 33% primarily due to a copper leach pad inventory adjustment in the prior year, lower leaching costs as a result of lower commodity consumption and a lower co-product allocation of costs to copper. Depreciation and amortization per ounce decreased 5% primarily due to lower amortization rates. Depreciation and amortization per pound decreased 33% primarily due to a copper leach pad inventory adjustment in the prior year, lower amortization rates and a lower co-product allocation of costs to copper. All-in sustaining costs per ounce increased 15% primarily due to the higher costs applicable to sales per ounce. All-in sustaining costs per pound decreased 32% primarily due to the lower costs applicable to sales per pound.

Twin Creeks, USA. Gold production decreased 17% due to lower ore grades mined and milled as a result of mine sequencing, and lower mill throughput as a result of harder ore at the Juniper mill. Costs applicable to sales per ounce increased 21% due to lower ounces sold and higher stockpile and leach pad inventory adjustments. Depreciation and amortization per ounce increased 55% primarily due to lower ounces sold and higher stockpile and leach pad inventory adjustments. All-in sustaining costs per ounce increased 24% due to the higher costs applicable to sales per ounce and lower ounces sold.

Long Canyon, USA. Long Canyon achieved commercial production in November 2016.

CC&V, USA. Gold production increased 28% primarily due to a full year of ore placement at the Valley Leach Fill 2 leach pad and higher mill grade and throughput. Costs applicable to sales per ounce increased 10% primarily due to lower production from the Valley Leach Fill 1 leach pad. Depreciation and amortization per ounce decreased 2% primarily due to higher ounces sold. All-in sustaining costs per ounce increased 13% primarily due to higher costs applicable to sales per ounce and higher sustaining capital.

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South America Operations


	Gold or Copper		Costs Applicable				Depreciation and				All-In Sustaining
	Produced		to Sales (1)				Amortization				Costs (2)
	2017	2016	2017		2016		2017		2016		2017		2016
Three Months Ended September 30,	(ounces in thousands)			($ per ounce sold)				($ per ounce sold)				($ per ounce sold)
Yanacocha	142	147	$	1,087	$	1,022	$	275	$	633	$	1,333	$	1,137
Merian (3)	129	—		496		—		176		—		608		—
Total / Weighted Average (4)	271	147	$	806	$	1,022	$	240	$	657	$	1,061	$	1,253
Yanacocha (48.65%)	(69)	(72)
Merian (25.00%)	(33)	—
Attributable to Newmont	169	75


	Gold or Copper		Costs Applicable				Depreciation and				All-In Sustaining
	Produced		to Sales (1)				Amortization				Costs (2)
	2017	2016	2017		2016		2017		2016		2017		2016
Nine Months Ended September 30,	(ounces in thousands)			($ per ounce sold)				($ per ounce sold)				($ per ounce sold)
Yanacocha	400	483	$	993	$	828	$	266	$	459	$	1,234	$	1,061
Merian (3)	355	—		493		—		195		—		578		—
Total / Weighted Average (4)	755	483	$	760	$	828	$	246	$	481	$	995	$	1,163
Yanacocha (48.65%)	(194)	(235)
Merian (25.00%)	(89)	—
Attributable to Newmont	472	248

⁽¹⁾

Excludes Depreciation and amortization and Reclamation and remediation.

⁽²⁾

All-In Sustaining Costs is a non-GAAP financial measure. See Non-GAAP Financial Measures beginning on page 72.

⁽³⁾

Merian reached commercial production in October 2016.

⁽⁴⁾

All-In Sustaining Costs and Depreciation and amortization include expense for other regional projects.

Three months ended September 30, 2017 compared to 2016

Yanacocha, Peru. Gold production decreased 3% primarily due to lower mill grade and recovery partially offset by higher ore grade placed on leach pads and higher mill throughput. Costs applicable to sales per ounce increased 6% primarily due to lower ounces sold and higher processing costs, partially offset by lower leach pad inventory adjustments. Depreciation and amortization per ounce decreased 57% due to a lower asset balance resulting from an impairment recorded in December 2016 and lower leach pad inventory adjustments, partially offset by lower ounces sold. All-in sustaining costs per ounce increased 17% primarily due to higher costs applicable to sales per ounce.

Merian, Suriname. Merian achieved commercial production in October 2016.

Nine months ended September 30, 2017 compared to 2016

Yanacocha, Peru. Gold production decreased 17% primarily due to lower mill grade and lower leach tons placed partially due to a commodity supply shortage resulting from extreme weather conditions along the Peruvian coast in the first quarter of 2017. Costs applicable to sales per ounce increased 20% due to lower ounces sold and higher processing costs, partially offset by lower leach pad inventory adjustments. Depreciation and amortization per ounce decreased 42% due to a lower asset balance resulting from an impairment recorded in December 2016 and lower leach pad inventory adjustments, partially offset by lower ounces sold. All-in sustaining costs per ounce increased 16% primarily due to the higher costs applicable to sales per ounce.

Merian, Suriname. Merian achieved commercial production in October 2016.

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Australia Operations


	Gold or Copper		Costs Applicable				Depreciation and				All-In Sustaining
	Produced		to Sales (1)				Amortization				Costs (2)
	2017	2016	2017		2016		2017		2016		2017		2016
Three Months Ended September 30,
Gold	(ounces in thousands)		($ per ounce sold)				($ per ounce sold)				($ per ounce sold)
Boddington	197	220	$	695	$	631	$	139	$	135	$	807	$	723
Tanami	114	114		626		503		148		177		800		768
Kalgoorlie	95	95		674		635		53		46		768		714
Total/Weighted-Average (3)	406	429	$	670	$	598	$	126	$	130	$	821	$	752

Copper	(pounds in millions)		($ per pound sold)				($ per pound sold)				($ per pound sold)
Boddington	20	21	$	1.32	$	1.56	$	0.26	$	0.31	$	1.63	$	1.90

Copper	(tonnes in thousands)
Boddington	9	10


	Gold or Copper		Costs Applicable				Depreciation and				All-In Sustaining
	Produced		to Sales (1)				Amortization				Costs (2)
	2017	2016	2017		2016		2017		2016		2017		2016
Nine Months Ended September 30,
Gold	(ounces in thousands)		($ per ounce sold)				($ per ounce sold)				($ per ounce sold)
Boddington	611	601	$	686	$	674	$	139	$	140	$	789	$	762
Tanami	286	360		623		502		166		173		782		700
Kalgoorlie	270	284		636		688		52		50		714		775
Total/Weighted-Average (3)	1,167	1,245	$	658	$	627	$	130	$	135	$	793	$	766

Copper	(pounds in millions)		($ per pound sold)				($ per pound sold)				($ per pound sold)
Boddington	61	57	$	1.30	$	1.66	$	0.26	$	0.33	$	1.58	$	1.96

Copper	(tonnes in thousands)
Boddington	28	26

⁽¹⁾

Excludes Depreciation and amortization and Reclamation and remediation.

⁽²⁾

All-In Sustaining Costs is a non-GAAP financial measure. See Non-GAAP Financial Measures beginning on page 72.

⁽³⁾

All-In Sustaining Costs and Depreciation and amortization include expense for other regional projects.

Three months ended September 30, 2017 compared to 2016

Boddington, Australia. Gold production decreased 10% primarily due to lower ore grade mined partially offset by higher mill throughput and higher recovery. Copper production decreased 5% primarily due to lower ore grade mined and lower recovery partially offset by higher mill throughput. Costs applicable to sales per ounce increased 10% primarily due to lower ounces sold, a higher co-product allocation of costs to gold and an unfavorable Australian dollar foreign currency exchange rate. Costs applicable to sales per pound decreased 15% primarily due to a lower co-product allocation of costs to copper, partially offset by lower copper pounds sold and an unfavorable Australian dollar foreign currency exchange rate. Depreciation and amortization per ounce increased 3% primarily due to lower ounces sold and a higher co-product allocation of costs to gold. Depreciation and amortization per pound decreased 16% primarily due to a lower co-product allocation of costs to copper, partially offset by lower copper pounds sold. All-in sustaining costs per ounce increased 12% primarily due to higher costs applicable to sales and higher sustaining capital spend per ounce. All-in sustaining costs per pound decreased 14% primarily due to lower costs applicable to sales per pound.

Tanami, Australia. Gold production was in line with the prior year. Costs applicable to sales per ounce increased 24% primarily due to higher oil prices, lower proportion of capital development, higher paste fill activity and an unfavorable Australian dollar foreign currency exchange rate. Depreciation and amortization per ounce decreased 16% primarily due to lower amortization rates. All-in sustaining costs per ounce increased 4% primarily due to higher costs applicable to sales per ounce, partially offset by lower sustaining capital spend.

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Kalgoorlie, Australia. Gold production was in line with the prior year. Costs applicable to sales per ounce increased 6% primarily due to higher mill maintenance costs, higher oil prices and an unfavorable Australian dollar foreign currency exchange rate, partially offset by higher ounces sold and lower selling costs. Depreciation and amortization per ounce increased 15% primarily due to higher amortization rates due to asset additions. All-in sustaining costs per ounce increased 8% primarily due to higher costs applicable to sales per ounce and higher exploration spend, partially offset by lower sustaining capital spend.

Nine months ended September 30, 2017 compared to 2016

Boddington, Australia. Gold production increased 2% primarily due to higher mill throughput, partially offset by lower ore grade milled. Copper production increased 7% primarily due to higher mill throughput and mill ore grade, partially offset by lower recovery. Costs applicable to sales per ounce increased 2% primarily due to a higher co-product allocation of costs to gold, higher oil prices and an unfavorable Australian dollar foreign currency exchange rate. Costs applicable to sales per pound decreased 22% primarily due to higher copper pounds sold and a lower co-product allocation of costs to copper, partially offset by higher oil prices and an unfavorable Australian dollar foreign currency exchange rate. Depreciation and amortization per ounce decreased 1% primarily due to higher ounces sold. Depreciation and amortization per pound decreased 21% primarily due to higher copper pounds sold and a lower co-product allocation of costs to copper. All-in sustaining costs per ounce increased 4% primarily due to higher costs applicable to sales per ounce and higher sustaining capital spend. All-in sustaining costs per pound decreased 19% primarily due to lower costs applicable to sales per pound and lower treatment and refining costs.

Tanami, Australia. Gold production decreased 21% primarily due to lower ore grade mined and mill throughput. Throughput was lower primarily due to the mill being placed into care and maintenance for the majority of February 2017 following record high rainfall that blocked transport routes, limiting access to fuel and other resources. Costs applicable to sales per ounce increased 24% primarily due to lower ounces sold, higher oil prices, an unfavorable Australian dollar foreign currency exchange rate and lower proportion of capital development, partially offset by lower paste fill activity. Depreciation and amortization per ounce decreased 4% primarily due to lower amortization rates. All-in sustaining costs per ounce increased 12% primarily due to higher costs applicable to sales per ounce, partially offset by lower sustaining capital spend and lower exploration and advanced project spend.

Kalgoorlie, Australia. Gold production decreased 5% primarily due to lower ore grade milled, lower recovery and lower draw-down of in-circuit inventory as compared to the prior year. Costs applicable to sales per ounce decreased 8% primarily due to lower mine maintenance costs, selling costs and site support costs, partially offset by lower ounces sold, higher oil prices and an unfavorable Australian dollar foreign currency exchange rate. Depreciation and amortization per ounce increased 4% primarily due to lower ounces sold. All-in sustaining costs per ounce decreased 8% primarily due to lower costs applicable to sales per ounce sold and lower treatment and refining costs, partially offset by higher exploration spend.

Africa Operations


	Gold or Copper		Costs Applicable				Depreciation and				All-In Sustaining
	Produced		to Sales (1)				Amortization				Costs (2)
	2017	2016	2017		2016		2017		2016		2017		2016
Three Months Ended September 30,	(ounces in thousands)		($ per ounce sold)				($ per ounce sold)				($ per ounce sold)
Ahafo	78	86	$	731	$	1,112	$	179	$	351	$	910	$	1,384
Akyem	113	116		588		532		351		280		693		641
Total / Weighted Average (3)	191	202	$	646	$	778	$	281	$	310	$	802	$	970


	Gold or Copper		Costs Applicable				Depreciation and				All-In Sustaining
	Produced		to Sales (1)				Amortization				Costs (2)
	2017	2016	2017		2016		2017		2016		2017		2016
Nine Months Ended September 30,	(ounces in thousands)		($ per ounce sold)				($ per ounce sold)				($ per ounce sold)
Ahafo	260	264	$	739	$	803	$	199	$	235	$	927	$	1,049
Akyem	371	345		543		499		306		269		624		594
Total / Weighted Average (3)	631	609	$	624	$	631	$	262	$	254	$	782	$	800

⁽¹⁾

Excludes Depreciation and amortization and Reclamation and remediation.

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⁽²⁾

All-In Sustaining Costs is a non-GAAP financial measure. See Non-GAAP Financial Measures beginning on page 72.

⁽³⁾

All-In Sustaining Costs and Depreciation and amortization include expense for other regional projects.

Three months ended September 30, 2017 compared to 2016

Ahafo, Ghana. Gold production decreased 9% due to lower throughput, partially offset by higher recovery and grade milled. Costs applicable to sales per ounce decreased 34% due to lower stockpile inventory adjustments and lower oil prices partially offset by lower ounces sold. Depreciation and amortization per ounce decreased 49% due to lower stockpile inventory adjustments. All-in sustaining costs per ounce decreased 34% primarily due to lower costs applicable to sales per ounce.

Akyem, Ghana. Gold production decreased 3% due to lower grade mined partially offset by higher drawdown of in-circuit inventory, higher mill throughput and recovery. Costs applicable to sales per ounce increased 11% primarily due to stockpile inventory adjustments in the current year and lower ounces sold, partially offset by lower oil prices and lower milling costs. Depreciation and amortization per ounce increased 25% due to stockpile inventory adjustments in the current year and lower ounces sold. All-in sustaining costs per ounce increased 8% due to higher costs applicable to sales per ounce partially offset by lower exploration spend.

Nine months ended September 30, 2017 compared to 2016

Ahafo, Ghana. Gold production decreased 2% due to lower mill throughput, partially offset by higher mill grade and recovery. Costs applicable to sales per ounce decreased 8% due to lower stockpile inventory adjustments and lower oil prices partially offset by lower ounces sold. Depreciation and amortization per ounce decreased 15% due to lower stockpile inventory adjustments. All-in sustaining costs per ounce decreased 12% primarily due to lower costs applicable to sales per ounce, lower sustaining capital and exploration spend.

Akyem, Ghana. Gold production increased 8% due to higher mill grade, throughput and recovery. Costs applicable to sales per ounce increased 9% primarily due to stockpile inventory adjustments in the current year and an unfavorable strip ratio, partially offset by higher ounces sold and lower oil prices. Depreciation and amortization per ounce increased 14% due to stockpile inventory adjustments in the current year, partially offset by higher ounces sold. All-in sustaining costs per ounce increased 5% due to higher costs applicable to sales, partially offset by lower exploration spend.

In October 2017 the government of Ghana approved our request to extend the stability period of the revised Investment Agreement at our Ahafo operations for five years to December 31, 2025. The extension was approved based on our commitment to invest at least $300 million for the Subika Underground and Ahafo Mill Expansion projects.

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Discontinued Operations


		Gold or Copper
		Produced
Three Months Ended September 30, 2016
Gold		(ounces in thousands)
Batu Hijau		219
Attributable to Newmont (48.5%)		106

Copper		(pounds in millions)
Batu Hijau		135
Attributable to Newmont (48.5%)		65

Copper		(tonnes in thousands)
Batu Hijau		61
Attributable to Newmont (48.5%)		30


		Gold or Copper
		Produced
Nine Months Ended September 30, 2016
Gold		(ounces in thousands)
Batu Hijau		600
Attributable to Newmont (48.5%)		291

Copper		(pounds in millions)
Batu Hijau		363
Attributable to Newmont (48.5%)		176

Copper		(tonnes in thousands)
Batu Hijau		165
Attributable to Newmont (48.5%)		80

For additional information regarding our discontinued operation, see Note 3 to our Condensed Consolidated Financial Statements.

Foreign Currency Exchange Rates

Our foreign operations sell their gold and copper production based on U.S. dollar metal prices and fluctuations in foreign currency exchange rates do not have a material impact on our revenue since gold and copper are sold throughout the world in U.S. dollars. Despite selling gold in London, we have no exposure to the euro or the British pound.

Foreign currency exchange rates can increase or decrease profits to the extent costs are paid in foreign currencies, including the Australian dollar, Peruvian sol and Suriname dollars. Approximately 31% and 32% of Costs applicable to sales for our foreign operations were paid in currencies other than the U.S. dollar during the three months ended September 30, 2017 and 2016, respectively, including approximately 26% denominated in the Australian dollar in the current year. Approximately 32% and 33% of Costs applicable to sales for our foreign operations were paid in currencies other than the U.S. dollar during the nine months ended September 30, 2017 and 2016, respectively, including approximately 27% denominated in the Australian dollar in the current year. Variations in the local currency exchange rates in relation to the U.S. dollar at our foreign mining operations did not have a significant impact on Costs applicable to sales on a per ounce basis, net of hedging losses, during the three and nine months ended September 30, 2017, compared to the same periods in 2016.

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Liquidity and Capital Resources

We have a disciplined cash management strategy of maintaining financial flexibility to execute our capital priorities and provide long-term value to our shareholders. Consistent with that strategy, we aim to self-fund development projects and make strategic partnerships focused on profitable growth, while reducing our debt and returning cash to stockholders through dividends.

At September 30, 2017, the Company had $2,969 in Cash and cash equivalents, of which $1,004 was held in foreign subsidiaries and is primarily held in U.S. dollar denominated accounts with the remainder in foreign currencies readily convertible to U.S. dollars. At September 30, 2017, $362 of the consolidated cash and cash equivalents was attributable to noncontrolling interests primarily related to our Peru and Suriname operations which is being held to fund those operations and development projects. At September 30, 2017, $941 in consolidated cash and cash equivalents ($590 attributable to Newmont) was held at certain foreign subsidiaries that, if repatriated, may be subject to withholding taxes. The repatriation of this cash and the applicable withholding taxes would generate foreign tax credits in the U.S. As a result, we expect that there would be no additional tax burden upon repatriation after considering the cash cost associated with the withholding taxes. We believe that our liquidity and capital resources from U.S. operations and flow-through foreign subsidiaries are adequate to fund our U.S. operations and corporate activities.

We believe our existing consolidated cash and cash equivalents, available capacity on our revolving credit facility, and cash generated from continuing operations will be adequate to satisfy working capital needs, fund future growth, meet debt obligations, pay dividends and meet other liquidity requirements for the foreseeable future. At September 30, 2017, no borrowings were outstanding under our revolving credit facility.

Liquidity Overview

During the nine months ended September 30, 2017, our cash and cash equivalents increased from $2,756 to $2,969. The net cash inflow of $213 was primarily provided by operating cash flows from continuing operations of $1,596, partially offset by repayment of debt of $579, cash used for additions to property, plant and mine development of $557, purchases of investments of $113, dividends paid to common stockholders of $94 and net distributions to our noncontrolling partners at Merian of $49.

During the nine months ended September 30, 2016, our cash and cash equivalents decreased from $2,363 to $2,099. The net cash outflow of $264 was primarily used for $832 of additions to property, plant and mine development, $777 of debt repayments at Corporate, $146 for dividends paid to noncontrolling partners at Yanacocha and $41 for dividends paid to common stockholders. These outflows were partially offset by operating cash flows from continuing operations of $1,333 in addition to proceeds received from the sale of our investment in Regis of $184 and funding from our noncontrolling partners at Merian of $58.

Our Condensed Consolidated Statements of Cash Flows are summarized as follows:


	Nine Months Ended
	September 30,
	2017		2016
Net cash provided by (used in) operating activities of continuing operations	$	1,596	$	1,333
Net cash provided by (used in) operating activities of discontinued operations		(12)		826
Net cash provided by (used in) operating activities	$	1,584	$	2,159

Net cash provided by (used in) investing activities of continuing operations	$	(627)	$	(661)
Net cash provided by (used in) investing activities of discontinued operations		—		(41)
Net cash provided by (used in) investing activities	$	(627)	$	(702)

Net cash provided by (used in) financing activities of continuing operations	$	(748)	$	(932)
Net cash provided by (used in) financing activities of discontinued operations		—		(319)
Net cash provided by (used in) financing activities	$	(748)	$	(1,251)

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Operating Activities

Net cash provided by (used in) operating activities of continuing operations was $1,596 during the nine months ended September 30, 2017, an increase of $263 from the nine months ended September 30, 2016, primarily due to higher sales volumes at Merian, Long Canyon and CC&V, partially offset by adverse weather conditions at Tanami and Yanacocha and higher direct operating costs.

Investing Activities

Net cash provided by (used in) investing activities of continuing operations was $(627) and $(661) during the nine months ended September 30, 2017 and 2016, respectively. Details of investing activities are below:

Additions to property, plant and mine development were $557 and $832 during the nine months ended September 30, 2017 and 2016, respectively, as follows:


	Nine Months Ended
	September 30,
	2017		2016
North America:
Carlin	$	128	$	116
Phoenix		14		15
Twin Creeks		33		29
Long Canyon		8		101
CC&V		17		49
Other North America		4		3
		204		313
South America:
Yanacocha		32		64
Merian		67		202
		99		266
Australia:
Boddington		46		40
Tanami		77		93
Kalgoorlie		13		13
Other Australia		3		—
		139		146
Africa:
Ahafo		104		61
Akyem		17		15
		121		76
Corporate and Other		5		6
Accrual basis		568		807
Decrease (increase) in accrued capital expenditures and other non-cash adjustments		(11)		25
Cash basis	$	557	$	832

Of the $557 of capital expenditures during the nine months ended September 30, 2017, $183 was for development projects predominantly comprised of:

$15 in North America primarily related to Long Canyon;

$52 in South America primarily related to Merian;

$39 in Australia primarily related to the Tanami Expansion project; and

$76 in Africa primarily related to the Subika Underground project and Ahafo Mill Expansion.

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The remaining $385 was for sustaining capital expenditures predominantly comprised of:

$189 in North America primarily related to surface and underground mine development, tailings facility construction and capitalized component purchases;

$47 in South America primarily related to the upgrade of water treatment facilities, a tailings facility expansion, capitalized component purchases and infrastructure improvements;

$100 in Australia primarily related to equipment and capitalized component purchases, underground mine development and tailings and support facilities; and

$45 in Africa primarily related to water treatment plant construction, a tailings facility expansion, purchase of mining equipment and capitalized component purchases.

Of the $832 of capital expenditures during the nine months ended September 30, 2016, $411 was for development projects predominantly comprised of:

$157 in North America primarily related to the Long Canyon project and the CC&V Expansion project;

$200 in South America primarily related to the Merian project;

$34 in Australia primarily related to the Tanami Expansion project; and

$20 in Africa primarily related to the Subika Underground project and Ahafo Mill Expansion.

The remaining $396 was for sustaining capital expenditures predominantly comprised of:

$156 in North America primarily related to tailings facility construction and capitalized component purchases;

$66 in South America primarily related to construction of water treatment facilities, a tailings facility expansion, capitalized component purchases and infrastructure improvements;

$112 in Australia primarily related to equipment and capitalized component purchases, underground mine development, and tailings and support facility construction; and

$56 in Africa primarily related to water treatment plant construction, a tailings facility expansion purchase of mining equipment and capitalized component purchases.

Refer to the discussion above regarding our global project pipeline discussion for additional details.

Purchase of investments. During the nine months ended September 30, 2017, we paid $109 for a 19.9% interest in Continental Gold, who is developing the high-grade Buriticá gold project in Columbia. Additionally, we paid $4 through a private placement with Goldstrike Resources, which secures rights to explore and develop the Plateau property located in a highly prospective mineralized trend in Canada’s Yukon Territory. See Note 15 to the Condensed Consolidated Financial Statements.

Proceeds from sales of investments. During the nine months ended September 30, 2017, we received $19 from the redemption of marketable debt securities and $15 from the sale of approximately two-thirds of our interest in Novo Resources Corp. During the nine months ended September 30, 2016, we received $184 from the sale of our investment in Regis.

Financing Activities

Net cash provided by (used in) financing activities of continuing operations was $(748) and $(932) during the nine months ended September 30, 2017 and 2016, respectively. Details of financing activities are below:

Repayment of debt. During the nine months ended September 30, 2017, we used $579 for debt repayments, of which $575 related to the 2017 Convertible Senior Notes. During the nine months ended September 30, 2016, we used $777 for debt repayments, of which $498 related to reductions of Senior Notes and $275 related to the payoff of the Term Loan.

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Remaining scheduled minimum debt repayments are $- for the remainder of 2017, $- in 2018, $626 in 2019, $- in 2020, $- in 2021 and $3,466 thereafter. Scheduled minimum capital lease repayments are $1 for the remainder of 2017, $4 in 2018, $3 in 2019, $1 in 2020, $1 in 2021 and $2 thereafter. We expect to fund maturities of debt from Net cash provided by (used in) operating activities of continuing operations, current investments, existing cash balances and available credit facilities. Depending upon market conditions and strategic considerations, we may choose to purchase or refinance some maturing debt in the capital markets.

At September 30, 2017, we were in compliance with all debt covenants and provisions related to potential defaults.

Distributions to noncontrolling interests. During the nine months ended September 30, 2017, distributions of $119, were made by Merian to Staatsolie Maatschappij Suriname N.V. (“Staatsolie”) (a company wholly owned by the Republic of Suriname). There were no distributions prior to Merian achieving commercial production in October 2016.

Funding from noncontrolling interests. During the nine months ended September 30, 2017, we received $70 in funding related to the ongoing operations of Merian from Staatsolie. During the nine months ended September 30, 2016, we received $58 in funding for the development of Merian from Staatsolie.

Dividends paid to common stockholders. We declared regular quarterly dividends totaling $0.175 and $0.075 per common share for the nine months ended September 30, 2017 and 2016, respectively. We paid dividends of $94 and $41 to common stockholders during the nine months ended September 30, 2017 and 2016, respectively.

Payments for withholding of employee taxes related to stock-based compensation. We paid $13 and $6 for withholding of employee taxes related to stock-based compensation for the nine months ended September 30, 2017 and 2016, respectively.

Dividends paid to noncontrolling interests. During the nine months ended September 30, 2016, Yanacocha paid dividends of $146 to noncontrolling interests.

Discontinued Operations

Net cash provided by (used in) operating activities of discontinued operations was $(12) and $826 during the nine months ended September 30, 2017 and 2016, respectively, of which $(3) is related to closing costs for the sale of Batu Hijau and $834 is related to the operating activities at Batu Hijau, respectively, and $(9) and $(8), is related to payments on the Holt royalty obligation, respectively.

Net cash provided by (used in) investing activities of discontinued operations was $(41) during the nine months ended September 30, 2016 and related entirely to Additions to property, plant and mine development at our Batu Hijau operations.

Net cash provided by (used in) financing activities of discontinued operations was $(319) during the nine months ended September 30, 2016 and related to debt repayments and a decrease in restricted cash at Batu Hijau.

Off-Balance Sheet Arrangements

We have the following off-balance sheet arrangements: operating leases (as discussed in Note 27 to the Consolidated Financial Statements for the year ended December 31, 2016, filed on February 21, 2017 on Form 10-K) and $2,323 of outstanding surety bonds, bank letters of credit and bank guarantees (see Note 24 to the Condensed Consolidated Financial Statements). At September 30, 2017, $80 of the $3,000 corporate revolving credit facility was used to secure the issuance of letters of credit, primarily supporting reclamation obligations.

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We also have sales agreements or non-binding commitments to sell copper and gold concentrates at market prices as follows (in thousands of tonnes):


	2017	2018	2019	2020	2021	Thereafter
Phoenix	51	55	62	47	45	208
Boddington	55	202	80	80	60	240
	106	257	142	127	105	448

Environmental

Our mining and exploration activities are subject to various federal and state laws and regulations governing the protection of the environment. We have made, and expect to make in the future, expenditures to comply with such laws and regulations, but cannot predict the full amount of such future expenditures. At September 30, 2017 and December 31, 2016, $1,863 and $1,792, respectively, were accrued for reclamation costs relating to currently or recently producing or development stage mineral properties, of which $37 and $28, respectively, were classified as current liabilities.

Reclamation costs are allocated to expense over the life of the related assets and are periodically adjusted to reflect changes in the estimated present value resulting from the passage of time and revisions to the estimates of either the timing or amount of the reclamation costs. Reclamation obligations are based on when the spending for an existing environmental disturbance will occur. We review, on at least an annual basis, the reclamation obligation at each mine.

Accounting for reclamation obligations requires management to make estimates unique to each mining operation of the future costs we will incur to complete the reclamation work required to comply with existing laws and regulations. As mining operations progress over their mine life, we are able to more accurately predict the estimated future reclamation costs. Any such changes in future costs, the timing of reclamation activities, or scope could materially impact the amounts charged to earnings for reclamation. Additionally, future changes to environmental laws and regulations could increase the extent of reclamation work required.

In addition, we are involved in several matters concerning environmental obligations associated with former mining activities. Based upon our best estimate of our liability for these matters, at September 30, 2017 and December 31, 2016, $272 and $298 were accrued for such obligations, respectively, of which $32 and $33 was classified as current liabilities. During the nine months ended September 30, 2017 and 2016, we spent $33 and $21, respectively, for environmental obligations related to the former, primarily historic, mining activities.

During the nine months ended September 30, 2017 and 2016, capital expenditures were approximately $51 and $60, respectively, to comply with environmental regulations.

For more information on the Company’s reclamation and remediation liabilities, see Notes 5 and 24 to the Condensed Consolidated Financial Statements.

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Accounting Developments

For a discussion of Recently Adopted and Recently Issued Accounting Pronouncements, see Note 2 to the Condensed Consolidated Financial Statements.

Non-GAAP Financial Measures

Non-GAAP financial measures are intended to provide additional information only and do not have any standard meaning prescribed by U.S. generally accepted accounting principles (“GAAP”). These measures should not be considered in isolation or as a substitute for measures of performance prepared in accordance with GAAP. Unless otherwise noted, we present the Non-GAAP financial measures of our continuing operations in the tables below. For additional information regarding our discontinued operations, see Note 3 to the Condensed Consolidated Financial Statements.

Earnings before interest, taxes and depreciation and amortization and Adjusted earnings before interest, taxes and depreciation and amortization

Management uses Earnings before interest, taxes and depreciation and amortization (“EBITDA”) and EBITDA adjusted for non-core or certain items that have a disproportionate impact on our results for a particular period (“Adjusted EBITDA”) as non-GAAP measures to evaluate the Company’s operating performance. EBITDA and Adjusted EBITDA do not represent, and should not be considered an alternative to, net income (loss), operating income (loss), or cash flow from operations as those terms are defined by GAAP, and do not necessarily indicate whether cash flows will be sufficient to fund cash needs. Although Adjusted EBITDA and similar measures are frequently used as measures of operations and the ability to meet debt service requirements by other companies, our calculation of Adjusted EBITDA is not necessarily comparable to such other similarly titled captions of other companies. The Company believes that Adjusted EBITDA provides useful information to investors and others in understanding and evaluating our operating results in the same manner as our management and Board of Directors. Management’s determination of the components of Adjusted EBITDA are evaluated periodically and based, in part, on a review of non-GAAP financial measures used by mining industry analysts. Net income (loss) attributable to Newmont stockholders is reconciled to EBITDA and Adjusted EBITDA as follows:


	Three Months Ended				Nine Months Ended
	September 30,				September 30,
	2017		2016		2017		2016
Net income (loss) attributable to Newmont stockholders	$	206	$	(358)	$	429	$	(283)
Net income (loss) attributable to noncontrolling interests		(8)		45		(22)		167
Net loss (income) from discontinued operations (1)		7		448		45		225
Equity loss (income) of affiliates		(1)		(2)		4		8
Income and mining tax expense (benefit)		72		90		349		555
Depreciation and amortization		327		335		928		892
Interest expense, net		56		64		187		204
EBITDA	$	659	$	622	$	1,920	$	1,768
Adjustments:
Loss (gain) on asset and investment sales (2)	$	(5)	$	(5)	$	(21)	$	(109)
Restructuring and other (3)		2		7		10		26
Reclamation and remediation charges (4)		—		—		3		—
Impairment of long-lived assets (5)		—		—		3		4
Acquisition cost adjustments (6)		(3)		9		2		11
La Quinua leach pad revision (7)		—		32		—		32
Loss on debt repayment (8)		—		1		—		4
Adjusted EBITDA	$	653	$	666	$	1,917	$	1,736

⁽¹⁾

Net loss (income) from discontinued operations relates to (i) adjustments in our Holt royalty obligation, presented net of tax expense (benefit) of $(4), $(9), $(25) and $(32), respectively, and (ii) Batu Hijau operations, presented net of tax expense (benefit) of $-, $90, $- and $258, respectively, and (iii) the loss on classification as held for sale, which has been recorded on an attributable basis. For additional information regarding our discontinued operations, see Note 3 to our Condensed Consolidated Financial Statements.

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⁽²⁾

Loss (gain) on asset and investment sales, included in Other income, net, primarily represents a gain from the exchange of our interest in the Fort á la Corne joint venture for equity ownership in Shore Gold in June 2017, the sale of our holdings in Regis in March 2016, income recorded in September 2016 associated with contingent consideration from the sale of certain properties in Nevada during the first quarter of 2015 and other gains or losses on asset sales.

⁽³⁾

Restructuring and other, included in Other expense, net, primarily represents certain costs associated with severance and outsourcing costs, accrued legal costs in our Africa region in 2016 and system integration costs in 2016 related to our acquisition of CC&V in August 2015.

⁽⁴⁾

Reclamation and remediation charges, included in Reclamation and remediation, represent revisions to remediation plans at the Company’s former historic mining operations.

⁽⁵⁾

Impairment of long-lived assets, included in Other expense, net, represents non-cash write-downs of long-lived assets.

⁽⁶⁾

Acquisition cost adjustments, included in Other expense, net, represent net adjustments to the contingent consideration and related liabilities associated with the acquisition of the final 33.33% interest in Boddington in June 2009.

⁽⁷⁾

La Quinua leach pad revision, included in Costs applicable to sales, represents a significant write-down of the estimated recoverable ounces at Yanacocha in September 2016.

⁽⁸⁾

Loss on debt repayment, included in Other income, net, represents the impact from the debt tender offer on our 2019 Senior Notes and 2039 Senior Notes in March 2016 and our Term Loan paydown in August 2016.

Adjusted net income (loss)

Management uses Adjusted net income (loss) to evaluate the Company’s operating performance and for planning and forecasting future business operations. The Company believes the use of Adjusted net income (loss) allows investors and analysts to understand the results of the continuing operations of the Company and its direct and indirect subsidiaries relating to the sale of products, by excluding certain items that have a disproportionate impact on our results for a particular period. Adjustments to continuing operations are presented before tax and net of our partners’ noncontrolling interests, when applicable. The tax effect of adjustments is presented in the Tax effect of adjustments line and is generally calculated using the Company’s statutory effective tax rate of 35%. Management’s determination of the components of Adjusted net income (loss) are evaluated periodically and based, in part, on a review of non-GAAP financial measures used by mining industry analysts. Net income (loss) attributable to Newmont stockholders is reconciled to Adjusted net income (loss) as follows:


	Three Months Ended				Nine Months Ended
	September 30,				September 30,
	2017		2016		2017		2016
Net income (loss) attributable to Newmont stockholders	$	206	$	(358)	$	429	$	(283)
Net loss (income) attributable to Newmont stockholders from discontinued operations (1)		7		527		45		454
Net income (loss) attributable to Newmont stockholders from continuing operations		213		169		474		171
Loss (gain) on asset and investment sales (2)		(5)		(5)		(21)		(109)
Restructuring and other, net (3)		1		7		8		24
Reclamation and remediation charges (4)		—		—		3		—
Impairment of long-lived assets, net (5)		—		—		2		3
Acquisition cost adjustments (6)		(3)		9		2		11
La Quinua leach pad revision (7)		—		26		—		26
Loss on debt repayment (8)		—		1		—		4
Tax effect of adjustments (9)		4		(12)		3		(24)
Valuation allowance and other tax adjustments (10)		(27)		7		93		380
Adjusted net income (loss)	$	183	$	202	$	564	$	486

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	Three Months Ended				Nine Months Ended
	September 30,				September 30,
	2017		2016		2017		2016
Net income (loss) per share, basic	$	0.38	$	(0.67)	$	0.80	$	(0.53)
Net loss (income) attributable to Newmont stockholders from discontinued operations		0.01		0.99		0.08		0.85
Net income (loss) attributable to Newmont stockholders from continuing operations		0.39		0.32		0.88		0.32
Loss (gain) on asset and investment sales		(0.01)		(0.01)		(0.04)		(0.21)
Restructuring and other, net		—		0.02		0.01		0.05
Reclamation and remediation charges		—		—		0.01		—
Impairment of long-lived assets, net		—		—		—		—
Acquisition cost adjustments		(0.01)		0.02		—		0.02
La Quinua leach pad revision		—		0.05		—		0.05
Loss on debt repayment		—		—		—		0.01
Tax effect of adjustments		0.01		(0.03)		0.01		(0.05)
Valuation allowance and other tax adjustments		(0.03)		0.01		0.19		0.73
Adjusted net income (loss) per share, basic	$	0.35	$	0.38	$	1.06	$	0.92

Net income (loss) per share, diluted	$	0.38	$	(0.67)	$	0.80	$	(0.53)
Net loss (income) attributable to Newmont stockholders from discontinued operations		0.01		0.99		0.08		0.85
Net income (loss) attributable to Newmont stockholders from continuing operations		0.39		0.32		0.88		0.32
Loss (gain) on asset and investment sales		(0.01)		(0.01)		(0.04)		(0.21)
Restructuring and other, net		—		0.02		0.01		0.05
Reclamation and remediation charges		—		—		0.01		—
Impairment of long-lived assets, net		—		—		—		—
Acquisition cost adjustments		(0.01)		0.02		—		0.02
La Quinua leach pad revision		—		0.05		—		0.05
Loss on debt repayment		—		—		—		0.01
Tax effect of adjustments		0.01		(0.03)		0.01		(0.05)
Valuation allowance and other tax adjustments		(0.03)		0.01		0.19		0.72
Adjusted net income (loss) per share, diluted	$	0.35	$	0.38	$	1.06	$	0.91

Weighted average common shares (millions):
Basic		533		531		533		530
Diluted		536		533		534		532

⁽¹⁾

Net loss (income) attributable to Newmont stockholders from discontinued operations relates to (i) adjustments in our Holt royalty obligation, presented net of tax expense (benefit) of $(4), $(9), $(25) and $(32), respectively, and (ii) Batu Hijau operations, presented net of tax expense (benefit) of $-, $90, $- and $258, respectively, and income (loss) attributable to noncontrolling interests of $-, ($79), $- and ($229), respectively, and (iii) the loss on classification as held for sale, which has been recorded on an attributable basis. Amounts are presented net of tax expense (benefit) in order to conform to our Condensed Consolidated Statements of Operations, as required under U.S. GAAP. For additional information regarding our discontinued operations, see Note 3 to our Condensed Consolidated Financial Statements.

⁽²⁾

⁽³⁾

Restructuring and other, net, included in Other expense, net, primarily represents certain costs associated with severance and outsourcing costs, accrued legal costs in our Africa region in 2016 and system integration costs in 2016 related to our acquisition of CC&V in August 2015. Amounts are presented net of income (loss) attributable to noncontrolling interests of $(1), $-, $(2) and $(2), respectively.

⁽⁴⁾

Reclamation and remediation charges, included in Reclamation and remediation, represent revisions to remediation plans at the Company’s former historic mining operations.

⁽⁵⁾

Impairment of long-lived assets, net, included in Other expense, net, represents non-cash write-downs of long-lived assets. Amounts are presented net of income (loss) attributable to noncontrolling interests of $-, $-, $(1) and $(1), respectively.

⁽⁶⁾

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⁽⁷⁾

La Quinua leach pad revision, included in Costs applicable to sales and Depreciation and amortization, represents a significant write-down of the estimated recoverable ounces at Yanacocha in September 2016. Amounts are presented net of income (loss) attributable to noncontrolling interests of $-, $(25), $- and $(25), respectively.

⁽⁸⁾

⁽⁹⁾

The tax effect of adjustments, included in Income and mining tax benefit (expense), represents the tax effect of adjustments in footnotes (2) through (8), as described above, and are calculated using the Company's statutory tax rate of 35%.

⁽¹⁰⁾

Valuation allowance and other tax adjustments, included in Income and mining tax benefit (expense), predominantly represent adjustments to remove the impact of our valuation allowances for items such as foreign tax credits, alternative minimum tax credits, capital losses and disallowed foreign losses. We believe that these valuation allowances cause significant fluctuations in our financial results that are not indicative of our underlying financial performance. The adjustments in the three and nine months ended September 30, 2017 are due to increases (decreases) in tax credit carryovers subject to valuation allowance of $(40) and $95, respectively, and other tax adjustments of $13 and $(2), respectively. The adjustments in the three and nine months ended September 30, 2016 are due to a tax restructuring of $170 during the first quarter, a carryback of 2015 tax loss to prior years of $124 during the second quarter, increases to valuation allowance on tax credit carryovers of $6 and $68, respectively, and other tax adjustments of $1 and $18, respectively.

Free Cash Flow

Management uses Free Cash Flow as a non-GAAP measure to analyze cash flows generated from operations. Free Cash Flow is Net cash provided by (used in) operating activities less Net cash provided by (used in) operating activities of discontinued operations less Additions to property, plant and mine development as presented on the Condensed Consolidated Statements of Cash Flows. The Company believes Free Cash Flow is also useful as one of the bases for comparing the Company’s performance with its competitors. Although Free Cash Flow and similar measures are frequently used as measures of cash flows generated from operations by other companies, the Company’s calculation of Free Cash Flow is not necessarily comparable to such other similarly titled captions of other companies.

The presentation of non-GAAP Free Cash Flow is not meant to be considered in isolation or as an alternative to net income as an indicator of the Company’s performance, or as an alternative to cash flows from operating activities as a measure of liquidity as those terms are defined by GAAP, and does not necessarily indicate whether cash flows will be sufficient to fund cash needs. The Company’s definition of Free Cash Flow is limited in that it does not represent residual cash flows available for discretionary expenditures due to the fact that the measure does not deduct the payments required for debt service and other contractual obligations or payments made for business acquisitions. Therefore, the Company believes it is important to view Free Cash Flow as a measure that provides supplemental information to the Company’s Condensed Consolidated Statements of Cash Flows.

The following table sets forth a reconciliation of Free Cash Flow, a non-GAAP financial measure, to Net cash provided by (used in) operating activities, which the Company believes to be the GAAP financial measure most directly comparable to Free Cash Flow, as well as information regarding Net cash provided by (used in) investing activities and Net cash provided by (used in) financing activities.


	Nine Months Ended September 30,
	2017		2016
Net cash provided by (used in) operating activities	$	1,584	$	2,159
Less: Net cash used in (provided by) operating activities of discontinued operations		12		(826)
Net cash provided by (used in) operating activities of continuing operations		1,596		1,333
Less: Additions to property, plant and mine development		(557)		(832)
Free Cash Flow	$	1,039	$	501

Net cash provided by (used in) investing activities (1)	$	(627)	$	(702)
Net cash provided by (used in) financing activities	$	(748)	$	(1,251)

⁽¹⁾

Net cash provided by (used in) investing activities includes Additions to property, plant and mine development, which is included in the Company’s computation of Free Cash Flow.

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Costs applicable to sales per ounce/pound

Costs applicable to sales per ounce/pound are non-GAAP financial measures. These measures are calculated by dividing the costs applicable to sales of gold and copper by gold ounces or copper pounds sold, respectively. These measures are calculated for the periods presented on a consolidated basis. Costs applicable to sales per ounce/pound statistics are intended to provide additional information only and do not have any standardized meaning prescribed by GAAP and should not be considered in isolation or as a substitute for measures of performance prepared in accordance with GAAP. The measures are not necessarily indicative of operating profit or cash flow from operations as determined under GAAP. Other companies may calculate these measures differently.

The following tables reconcile these non-GAAP measures to the most directly comparable GAAP measures.

Costs applicable to sales per ounce


	Three Months Ended				Nine Months Ended
	September 30,				September 30,
	2017		2016		2017		2016
Costs applicable to sales (1)	$	1,017	$	918	$	2,866	$	2,571
Gold sold (thousand ounces)		1,411		1,300		4,151		3,766
Costs applicable to sales per ounce	$	721	$	706	$	690	$	682

⁽¹⁾

Includes by-product credits of $16 and $42 during the three and nine months ended September 30, 2017, respectively, and $11 and $31 during the three and nine months ended September 30, 2016, respectively.

Costs applicable to sales per pound


	Three Months Ended				Nine Months Ended
	September 30,				September 30,
	2017		2016		2017		2016
Costs applicable to sales (1)	$	36	$	65	$	119	$	165
Copper sold (million pounds)		26		30		84		84
Costs applicable to sales per pound	$	1.38	$	2.14	$	1.42	$	1.96

⁽¹⁾

Includes by-product credits of $- and $3 during the three and nine months ended September 30, 2017, respectively, and $2 and $4 during the three and nine months ended September 30, 2016, respectively.

All-In Sustaining Costs

Newmont has worked to develop a metric that expands on GAAP measures, such as cost of goods sold, and non-GAAP measures, such as Costs applicable to sales per ounce, to provide visibility into the economics of our mining operations related to expenditures, operating performance and the ability to generate cash flow from our continuing operations.

Current GAAP-measures used in the mining industry, such as cost of goods sold, do not capture all of the expenditures incurred to discover, develop and sustain production. Therefore, we believe that all-in sustaining costs is a non-GAAP measure that provides additional information to management, investors and analysts that aid in the understanding of the economics of our operations and performance compared to other producers and in the investor’s visibility by better defining the total costs associated with production.

All-in sustaining cost (“AISC”) amounts are intended to provide additional information only and do not have any standardized meaning prescribed by GAAP and should not be considered in isolation or as a substitute for measures of performance prepared in accordance with GAAP. The measures are not necessarily indicative of operating profit or cash flow from operations as determined under GAAP. Other companies may calculate these measures differently as a result of differences in the underlying accounting principles, policies applied and in accounting frameworks such as in International Financial Reporting Standards (“IFRS”), or by reflecting the benefit from selling non-gold metals as a reduction to AISC. Differences may also arise related to definitional differences of sustaining versus development capital activities based upon each company’s internal policies.

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The following disclosure provides information regarding the adjustments made in determining the all-in sustaining costs measure:

Costs applicable to sales. Includes all direct and indirect costs related to current production incurred to execute the current mine plan. We exclude certain exceptional or unusual amounts from Costs applicable to sales (“CAS”), such as significant revisions to recovery amounts. CAS includes by-product credits from certain metals obtained during the process of extracting and processing the primary ore-body. CAS is accounted for on an accrual basis and excludes Depreciation and amortization and Reclamation and remediation, which is consistent with our presentation of CAS on the Condensed Consolidated Statements of Operations. In determining AISC, only the CAS associated with producing and selling an ounce of gold is included in the measure. Therefore, the amount of gold CAS included in AISC is derived from the CAS presented in the Company’s Condensed Consolidated Statements of Operations less the amount of CAS attributable to the production of copper at our Phoenix and Boddington mines. The copper CAS at those mine sites is disclosed in Note 4 to the Condensed Consolidated Financial Statements. The allocation of CAS between gold and copper at the Phoenix and Boddington mines is based upon the relative sales value of gold and copper produced during the period.

Reclamation costs. Includes accretion expense related to Asset Retirement Obligation (“ARO”) and the amortization of the related Asset Retirement Cost (“ARC”) for the Company’s operating properties. Accretion related to the ARO and the amortization of the ARC assets for reclamation does not reflect annual cash outflows but are calculated in accordance with GAAP. The accretion and amortization reflect the periodic costs of reclamation associated with current production and are therefore included in the measure. The allocation of these costs to gold and copper is determined using the same allocation used in the allocation of CAS between gold and copper at the Phoenix and Boddington mines.

Advanced projects, research and development and exploration. Includes incurred expenses related to projects that are designed to increase or enhance current production and exploration. We note that as current resources are depleted, exploration and advanced projects are necessary for us to replace the depleting reserves or enhance the recovery and processing of the current reserves. As this relates to sustaining our production, and is considered a continuing cost of a mining company, these costs are included in the AISC measure. These costs are derived from the Advanced projects, research and development and Exploration amounts presented in the Condensed Consolidated Statements of Operations less the amount attributable to the production of copper at our Phoenix and Boddington mines. The allocation of these costs to gold and copper is determined using the same allocation used in the allocation of CAS between gold and copper at the Phoenix and Boddington mines.

General and administrative. Includes costs related to administrative tasks not directly related to current production, but rather related to support our corporate structure and fulfill our obligations to operate as a public company. Including these expenses in the AISC metric provides visibility of the impact that general and administrative activities have on current operations and profitability on a per ounce basis.

Other expense, net. We exclude certain exceptional or unusual expenses from Other expense, net, such as restructuring, as these are not indicative to sustaining our current operations. Furthermore, this adjustment to Other expense, net is also consistent with the nature of the adjustments made to Net income (loss) attributable to Newmont stockholders as disclosed in the Company’s non-GAAP financial measure Adjusted net income (loss). The allocation of these costs to gold and copper is determined using the same allocation used in the allocation of CAS between gold and copper at the Phoenix and Boddington mines.

Treatment and refining costs. Includes costs paid to smelters for treatment and refining of our concentrates to produce the salable metal. These costs are presented net as a reduction of Sales on our Condensed Consolidated Statements of Operations.

Sustaining capital. We determined sustaining capital as those capital expenditures that are necessary to maintain current production and execute the current mine plan. Capital expenditures to develop new operations, or related to projects at existing operations where these projects will enhance production or reserves, are generally considered

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development. We determined the classification of sustaining and development capital projects based on a systematic review of our project portfolio in light of the nature of each project. Sustaining capital costs are relevant to the AISC metric as these are needed to maintain the Company’s current operations and provide improved transparency related to our ability to finance these expenditures from current operations. The allocation of these costs to gold and copper is determined using the same allocation used in the allocation of CAS between gold and copper at the Phoenix and Boddington mines.


					Advanced
					Projects,
					Research and						Treatment							All-In
	Costs				Development		General		Other		and				All-In		Ounces	Sustaining
Three Months Ended	Applicable		Reclamation		and		and		Expense,		Refining		Sustaining		Sustaining		(000)/Pounds	Costs per
September 30, 2017	to Sales (1)(2)(3)		Costs (4)		Exploration(5)		Administrative		Net (6)		Costs		Capital (7)		Costs		(millions) Sold	oz/lb
Gold
Carlin	$	216	$	2	$	6	$	2	$	—	$	—	$	31	$	257	259	$	992
Phoenix		48		1		—		1		1		2		3		56	54		1,037
Twin Creeks		59		1		3		1		1		—		10		75	81		926
Long Canyon		17		—		—		1		—		—		—		18	55		327
CC&V		75		1		2		—		—		—		9		87	110		791
Other North America		—		—		16		—		(1)		—		2		17	—		—
North America		415		5		27		5		1		2		55		510	559		912

Yanacocha		150		17		6		1		1		—		9		184	138		1,333
Merian		62		1		3		—		—		—		10		76	125		608
Other South America		—		—		17		3		(1)		—		—		19	—		—
South America		212		18		26		4		—		—		19		279	263		1,061

Boddington		130		2		—		—		—		7		12		151	187		807
Tanami		72		1		2		—		—		—		17		92	115		800
Kalgoorlie		64		1		3		—		—		1		4		73	95		768
Other Australia		—		—		7		3		(1)		—		1		10	—		—
Australia		266		4		12		3		(1)		8		34		326	397		821

Ahafo		57		2		3		—		—		—		9		71	78		910
Akyem		67		3		2		—		—		—		7		79	114		693
Other Africa		—		—		4		—		—		—		—		4	—		—
Africa		124		5		9		—		—		—		16		154	192		802

Corporate and Other		—		—		13		46		2		—		1		62	—		—
Total Gold	$	1,017	$	32	$	87	$	58	$	2	$	10	$	125	$	1,331	1,411	$	943

Copper
Phoenix	$	11	$	—	$	1	$	—	$	—	$	—	$	—	$	12	7	$	1.71
Boddington		25		—		1		—		—		2		3		31	19		1.63
Total Copper	$	36	$	—	$	2	$	—	$	—	$	2	$	3	$	43	26	$	1.65

Consolidated	$	1,053	$	32	$	89	$	58	$	2	$	12	$	128	$	1,374

⁽¹⁾

Excludes Depreciation and amortization and Reclamation and remediation.

⁽²⁾

Includes by-product credits of $16.

⁽³⁾

Includes stockpile and leach pad inventory adjustments of $21 at Carlin, $10 at Twin Creeks, $22 at Yanacocha and $7 at Akyem.

⁽⁴⁾

Reclamation costs include operating accretion of $21 and amortization of asset retirement costs of $11.

⁽⁵⁾

Advanced projects, research and development and Exploration of $6 at Long Canyon, $5 at Yanacocha, $5 at Tanami, $3 at Ahafo and $1 at Akyem are recorded in “Other” of the respective region for development projects.

⁽⁶⁾

Other expense, net is adjusted for net acquisition costs of $(3) and restructuring and other costs of $2.

⁽⁷⁾

Excludes development capital expenditures, capitalized interest and changes in accrued capital, totaling $66. The following are major development projects: Merian, Subika Underground, and the Tanami and Ahafo mill expansions.

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					Advanced
					Projects,
					Research and						Treatment							All-In
	Costs				Development		General		Other		and				All-In		Ounces	Sustaining
Three Months Ended	Applicable		Reclamation		and		and		Expense,		Refining		Sustaining		Sustaining		(000)/Pounds	Costs per
September 30, 2016	to Sales (1)(2)(3)		Costs (4)		Exploration(5)		Administrative		Net (6)		Costs		Capital (7)		Costs		(millions) Sold	oz/lb
Gold
Carlin	$	212	$	2	$	7	$	1	$	—	$	—	$	36	$	258	272	$	949
Phoenix		30		1		—		—		—		2		3		36	47		766
Twin Creeks		52		—		2		1		—		—		8		63	96		656
Long Canyon		—		—		—		—		—		—		—		—	—		—
CC&V		65		1		3		—		—		—		4		73	113		646
Other North America		—		—		7		1		1		—		—		9	—		—
North America		359		4		19		3		1		2		51		439	528		831

Yanacocha		116		15		6		2		—		—		27		166	146		1,137
Merian		—		—		—		—		—		—		—		—	—		—
Other South America		—		—		15		2		—		—		—		17	—		—
South America		116		15		21		4		—		—		27		183	146		1,253

Boddington		139		1		—		—		—		6		13		159	220		723
Tanami		57		1		4		—		—		—		24		86	112		768
Kalgoorlie		57		1		1		—		—		1		5		65	91		714
Other Australia		—		—		2		4		1		—		1		8	—		—
Australia		253		3		7		4		1		7		43		318	423		752

Ahafo		95		2		8		—		1		—		13		119	86		1,384
Akyem		63		2		4		—		1		—		5		75	117		641
Other Africa		—		—		1		2		—		—		—		3	—		—
Africa		158		4		13		2		2		—		18		197	203		970

Corporate and Other		—		—		13		50		1		—		1		65	—		—
Total Gold	$	886	$	26	$	73	$	63	$	5	$	9	$	140	$	1,202	1,300	$	925

Copper
Phoenix	$	32	$	1	$	—	$	—	$	—	$	—	$	4	$	37	9	$	4.11
Boddington		33		1		—		—		—		3		3		40	21		1.90
Total Copper	$	65	$	2	$	—	$	—	$	—	$	3	$	7	$	77	30	$	2.57

Consolidated	$	951	$	28	$	73	$	63	$	5	$	12	$	147	$	1,279

⁽¹⁾

Excludes Depreciation and amortization and Reclamation and remediation.

⁽²⁾

Includes by-product credits of $13.

⁽³⁾

Includes stockpile and leach pad inventory adjustments of $8 at Carlin, $1 at Twin Creeks, $17 at Yanacocha and $34 at Ahafo. Total stockpile and leach pad inventory adjustments at Yanacocha of $49 were adjusted above by $32 related to a significant write off of recoverable ounces at the La Quinua Leach Pad.

⁽⁴⁾

Reclamation costs include operating accretion of $17 and amortization of asset retirement costs of $11.

⁽⁵⁾

Advanced projects, research and development and Exploration of $4 at Long Canyon and $7 at Merian are recorded in “Other” of the respective region for development projects.

⁽⁶⁾

Other expense, net is adjusted for restructuring and other costs of $7 and acquisition costs of $9.

⁽⁷⁾

Excludes development capital expenditures, capitalized interest and changes in accrued capital, totaling $122. The following are major development projects: Merian, Long Canyon and the CC&V and Tanami expansions.

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					Advanced
					Projects,
					Research and						Treatment							All-In
	Costs				Development		General		Other		and				All-In		Ounces	Sustaining
Nine Months Ended	Applicable		Reclamation		and		and		Expense,		Refining		Sustaining		Sustaining		(000)/Pounds	Costs per
September 30, 2017	to Sales (1)(2)(3)		Costs (4)		Exploration(5)		Administrative		Net (6)		Costs		Capital (7)		Costs		(millions) Sold	oz/lb
Gold
Carlin	$	579	$	5	$	14	$	3	$	—	$	—	$	126	$	727	689	$	1,055
Phoenix		137		4		4		1		1		8		9		164	155		1,058
Twin Creeks		167		3		7		2		1		—		27		207	282		734
Long Canyon		42		1		—		1		—		—		1		45	132		341
CC&V		219		3		9		1		—		—		17		249	361		690
Other North America		—		—		33		—		2		—		4		39	—		—
North America		1,144		16		67		8		4		8		184		1,431	1,619		884

Yanacocha		403		49		13		3		4		—		29		501	406		1,234
Merian		174		1		11		—		—		—		18		204	353		578
Other South America		—		—		41		9		—		—		—		50	—		—
South America		577		50		65		12		4		—		47		755	759		995

Boddington		399		5		1		—		—		16		38		459	582		789
Tanami		180		2		3		—		—		—		41		226	289		782
Kalgoorlie		171		2		6		—		—		1		12		192	269		714
Other Australia		—		—		18		7		(1)		—		3		27	—		—
Australia		750		9		28		7		(1)		17		94		904	1,140		793

Ahafo		193		5		14		—		2		—		28		242	261		927
Akyem		202		9		3		—		1		—		17		232	372		624
Other Africa		—		—		16		5		—		—		—		21	—		—
Africa		395		14		33		5		3		—		45		495	633		782

Corporate and Other		—		—		39		139		7		—		4		189	—		—
Total Gold	$	2,866	$	89	$	232	$	171	$	17	$	25	$	374	$	3,774	4,151	$	909

Copper
Phoenix	$	45	$	1	$	1	$	—	$	—	$	1	$	5	$	53	27	$	1.96
Boddington		74		1		1		—		—		8		6		90	57		1.58
Total Copper	$	119	$	2	$	2	$	—	$	—	$	9	$	11	$	143	84	$	1.70

Consolidated	$	2,985	$	91	$	234	$	171	$	17	$	34	$	385	$	3,917

⁽¹⁾

Excludes Depreciation and amortization and Reclamation and remediation.

⁽²⁾

Includes by-product credits of $45.

⁽³⁾

Includes stockpile and leach pad inventory adjustments of $48 at Carlin, $21 at Twin Creeks, $52 at Yanacocha, $13 at Ahafo and $12 at Akyem.

⁽⁴⁾

Reclamation costs include operating accretion of $63 and amortization of asset retirement costs of $28.

⁽⁵⁾

Advanced projects, research and development and Exploration of $16 at Long Canyon, $10 at Yanacocha, $13 at Tanami, $8 at Ahafo and $6 at Akyem are recorded in “Other” of the respective region for development projects.

⁽⁶⁾

Other expense, net is adjusted for restructuring and other costs of $10, acquisition costs of $2 and write-downs of $3.

⁽⁷⁾

Excludes development capital expenditures, capitalized interest and changes in accrued capital, totaling $172. The following are major development projects: Merian, Long Canyon, Tanami expansions, Subika Underground and Ahafo mill expansion.

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					Advanced
					Projects,
					Research and						Treatment							All-In
	Costs				Development		General		Other		and				All-In		Ounces	Sustaining
Nine Months Ended	Applicable		Reclamation		and		and		Expense,		Refining		Sustaining		Sustaining		(000)/Pounds	Costs per
September 30, 2016	to Sales (1)(2)(3)		Costs (4)		Exploration(5)		Administrative		Net (6)		Costs		Capital (7)		Costs		(millions) Sold	oz/lb
Gold
Carlin	$	585	$	4	$	14	$	4	$	—	$	—	$	106	$	713	683	$	1,044
Phoenix		118		3		1		1		—		7		8		138	150		920
Twin Creeks		170		2		6		1		—		—		26		205	347		591
Long Canyon		—		—		—		—		—		—		—		—	—		—
CC&V		156		3		7		1		—		—		6		173	283		611
Other North America		—		—		26		1		3		—		3		33	—		—
North America		1,029		12		54		8		3		7		149		1,262	1,463		863

Yanacocha		364		43		26		7		2		—		66		508	479		1,061
Merian		—		—		—		—		—		—		—		—	—		—
Other South America		—		—		45		4		—		—		—		49	—		—
South America		364		43		71		11		2		—		66		557	479		1,163

Boddington		391		4		—		—		—		16		32		443	581		762
Tanami		180		2		10		—		—		—		58		250	357		700
Kalgoorlie		189		3		4		—		—		4		13		213	275		775
Other Australia		—		—		5		12		4		—		2		23	—		—
Australia		760		9		19		12		4		20		105		929	1,213		766

Ahafo		212		5		20		—		1		—		39		277	264		1,049
Akyem		174		6		8		—		1		—		17		206	347		594
Other Africa		—		—		2		4		—		—		—		6	—		—
Africa		386		11		30		4		2		—		56		489	611		800

Corporate and Other		—		—		38		143		2		—		6		189	—		—
Total Gold	$	2,539	$	75	$	212	$	178	$	13	$	27	$	382	$	3,426	3,766	$	910

Copper
Phoenix	$	76	$	2	$	—	$	—	$	—	$	2	$	7	$	87	30	$	2.90
Boddington		89		1		—		—		—		9		7		106	54		1.96
Total Copper	$	165	$	3	$	—	$	—	$	—	$	11	$	14	$	193	84	$	2.30

Consolidated	$	2,704	$	78	$	212	$	178	$	13	$	38	$	396	$	3,619

⁽¹⁾

Excludes Depreciation and amortization and Reclamation and remediation.

⁽²⁾

Includes by-product credits of $35.

⁽³⁾

Includes stockpile and leach pad inventory adjustments of $51 at Carlin, $11 at Twin Creeks, $71 at Yanacocha and $34 at Ahafo. Total stockpile and leach pad inventory adjustments at Yanacocha of $103 were adjusted above by $32 related to a significant write off of recoverable ounces at the La Quinua Leach Pad.

⁽⁴⁾

Reclamation costs include operating accretion of $48 and amortization of asset retirement costs of $30.

⁽⁵⁾

Advanced projects, research and development and Exploration of $17 at Long Canyon and $21 at Merian are recorded in “Other” of the respective region for development projects.

⁽⁶⁾

Other expense, net is adjusted for restructuring and other costs of $26, acquisition costs of $11 and write-downs of $4.

⁽⁷⁾

Excludes development capital expenditures, capitalized interest and changes in accrued capital, totaling $436. The following are major development projects: Merian, Long Canyon and the CC&V and Tanami expansions.

Safe Harbor Statement

Certain statements contained in this report (including information incorporated by reference herein) are “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933, as amended (the “Securities Act”), and Section 21E of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), and are intended to be covered by the safe harbor provided for under these sections. Words such as “expect(s)”, “feel(s)”, “believe(s)”, “will”, “may”, “anticipate(s)”, “estimate(s)”, “should”, “intend(s)” and similar expressions are intended to identify forward-looking statements. Our forward-looking statements may include, without limitation:

estimates regarding future earnings and the sensitivity of earnings to gold, copper and other metal prices;

estimates of future mineral production and sales;

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estimates of future production costs, other expenses and taxes for specific operations and on a consolidated basis;

estimates of future cash flows and the sensitivity of cash flows to gold and other metal prices;

estimates of future capital expenditures, construction, production or closure activities and other cash needs, for specific operations and on a consolidated basis, and expectations as to the funding or timing thereof;

estimates as to the projected development of certain ore deposits, including the timing of such development, the costs of such development and other capital costs, financing plans for these deposits and expected production commencement dates;

estimates of reserves and statements regarding future exploration results and reserve replacement and the sensitivity of reserves to metal price changes;

statements regarding the availability of, and terms and costs related to, future borrowing or financing;

estimates regarding future exploration expenditures, results and reserves;

statements regarding fluctuations in financial and currency markets;

estimates regarding potential cost savings, productivity, operating performance and ownership and cost structures;

expectations regarding statements regarding future transactions, including, without limitation, statements related to future acquisitions and projected benefits, synergies and costs associated with acquisitions and related matters;

expectations regarding the start-up time, design, mine life, production and costs applicable to sales and exploration potential of our projects;

statements regarding future hedge and derivative positions or modifications thereto;

statements regarding political, economic or governmental conditions and environments;

statements regarding the impacts of changes in the legal and regulatory environment in which we operate;

estimates of future costs, accruals for reclamation costs and other liabilities for certain environmental matters, including without limitation with respect to our Yanacocha operation;

estimates of income taxes and expectations relating to tax contingencies or tax audits; and

estimates of pension and other post-retirement costs.

Where we express an expectation or belief as to future events or results, such expectation or belief is expressed in good faith and believed to have a reasonable basis. However, our forward-looking statements are subject to risks, uncertainties and other factors, which could cause actual results to differ materially from future results expressed, projected or implied by those forward-looking statements. Such risks include, but are not limited to:

the price of gold, copper and other metal prices and commodities;

the cost of operations;

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currency fluctuations;

geological and metallurgical assumptions;

operating performance of equipment, processes and facilities;

labor relations;

timing of receipt of necessary governmental permits or approvals;

domestic and foreign laws or regulations, particularly relating to the environment, mining and processing;

changes in tax laws;

domestic and international economic and political conditions;

our ability to obtain or maintain necessary financing; and

other risks and hazards associated with mining operations.

More detailed information regarding these factors is included in the section titled Item 1, Business; Item 1A, Risk Factors in the Annual Report on Form 10-K for the year ended December 31, 2016 filed February 21, 2017 and elsewhere throughout this report. Many of these factors are beyond our ability to control or predict. Given these uncertainties, readers are cautioned not to place undue reliance on our forward-looking statements.

All subsequent written and oral forward-looking statements attributable to Newmont or to persons acting on its behalf are expressly qualified in their entirety by these cautionary statements. We disclaim any intention or obligation to update publicly any forward-looking statements, whether as a result of new information, future events or otherwise, except as may be required under applicable securities laws.

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ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK (dollars in millions, except per ounce and per pound amounts).

Metal Prices

Changes in the market price of gold significantly affect our profitability and cash flow. Gold prices can fluctuate widely due to numerous factors, such as demand; forward selling by producers; central bank sales, purchases and lending; investor sentiment; the strength of the U.S. dollar; inflation, deflation, or other general price instability and global mine production levels. Changes in the market price of copper also affect our profitability and cash flow. Copper is traded on established international exchanges and copper prices generally reflect market supply and demand, but can also be influenced by speculative trading in the commodity or by currency exchange rates.

Decreases in the market price of gold and copper can also significantly affect the value of our product inventory, stockpiles and leach pads, and it may be necessary to record a write-down to the net realizable value. Net realizable value represents the estimated future sales price based on short-term and long-term metals prices, less estimated costs to complete production and bring the product to sale. The primary factors that influence the need to record write-downs of our stockpiles, leach pads and product inventory include short-term and long-term metals prices and costs for production inputs such as labor, fuel and energy, materials and supplies as well as realized ore grades and recovery rates. The significant assumptions in determining the stockpile, leach pad and product inventory adjustments for each mine site reporting unit at September 30, 2017 included production cost and capitalized expenditure assumptions unique to each operation, a short-term and long-term gold price of $1,278 and $1,300 per ounce, respectively, a short-term and long-term copper price of $2.88 and $3.00 per pound, respectively, and a short-term and long-term Australian to U.S. dollar exchange rate of $0.79 and $0.80, respectively.

The net realizable value measurement involves the use of estimates and assumptions unique to each mining operation regarding current and future operating and capital costs, metal recoveries, production levels, commodity prices, proven and probable reserve quantities, engineering data and other factors. A high degree of judgment is involved in determining such assumptions and estimates and no assurance can be given that actual results will not differ significantly from those estimates and assumptions.

Hedging

Our strategy is to provide shareholders with leverage to changes in gold and copper prices by selling our production at spot market prices. Consequently, we do not hedge our gold and copper sales. We have and may continue to manage certain risks associated with commodity input costs, interest rates and foreign currencies using the derivative market.

By using hedges, we are affected by credit risk, market risk and market liquidity risk. Credit risk is the risk that a third party might fail to fulfill its performance obligations under the terms of a financial instrument. We mitigate credit risk by entering into derivatives with high credit quality counterparties, limiting the amount of exposure to each counterparty and monitoring the financial condition of the counterparties. Market risk is the risk that the fair value of a derivative might be adversely affected by a change in underlying commodity prices, interest rates or currency exchange rates, and that this in turn affects our financial condition. We manage market risk by establishing and monitoring parameters that limit the types and degree of market risk that may be undertaken. We mitigate this potential risk to our financial condition by establishing trading agreements with counterparties under which we are not required to post any collateral or be subject to any margin calls on our derivatives. Our counterparties cannot require settlement solely because of an adverse change in the fair value of a derivative. Market liquidity risk is the risk that a derivative cannot be eliminated quickly, by either liquidating it or by establishing an offsetting position. Under the terms of our trading agreements, counterparties cannot require us to immediately settle outstanding derivatives, except upon the occurrence of customary events of default such as covenant breaches, including financial covenants, insolvency or bankruptcy. We further mitigate market liquidity risk by spreading out the maturity of our derivatives over time.

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Cash Flow Hedges

The foreign currency and diesel derivative contracts are designated as cash flow hedges, and as such, the effective portion of unrealized changes in market value have been recorded in Accumulated other comprehensive income (loss) and are reclassified to income during the period in which the hedged transaction affects earnings. Gains and losses from hedge ineffectiveness are recognized in current earnings.

Foreign Currency Exchange Risk

We had the following foreign currency derivative contracts in Australia outstanding at September 30, 2017:


	Expected Maturity Date
	2017		2018		Total/Average
A$ Operating Fixed Forward Contracts:
A$ notional (millions)	24		6		30
Average rate ($/A$)	0.93		0.92		0.93
Expected hedge ratio	7	%	5	%

The fair value of the A$ foreign currency derivative contracts was a net liability position of $4 at September 30, 2017 and $24 at December 31, 2016.

Diesel Price Risk

We had the following diesel derivative contracts in Nevada, within North America, outstanding at September 30, 2017:


	Expected Maturity Date
	2017		2018		2019		Total/Average
Diesel Fixed Forward Contracts:
Diesel gallons (millions)	6		14		1		21
Average rate ($/gallon)	1.59		1.60		1.61		1.60
Expected hedge ratio	69	%	38	%	7	%

The fair value of the diesel derivative contracts was a net asset position of $3 at September 30, 2017 and $- at December 31, 2016.

Commodity Price Exposure

Our provisional gold and copper sales contain an embedded derivative that is required to be separated from the host contract for accounting purposes. The host contract is the receivable from the sale of the gold and copper concentrates at the prevailing indices’ prices at the time of sale. The embedded derivative, which does not qualify for hedge accounting, is marked to market through earnings each period prior to final settlement.

At September 30, 2017, Newmont had gold sales of 75,000 ounces priced at an average of $1,285 per ounce, subject to final pricing over the next several months. Each $25 change in the price for provisionally priced gold sales would have an approximate $1 effect on our Net income (loss) attributable to Newmont stockholders. The London Bullion Market Association P.M. closing settlement price at September 30, 2017 for gold was $1,283 per ounce.

At September 30, 2017, Newmont had copper sales of 20 million pounds priced at an average of $2.96 per pound, subject to final pricing over the next several months. Each $0.10 change in the price for provisionally priced copper sales would have an approximate $1 effect on our Net income (loss) attributable to Newmont stockholders. The LME closing settlement price at September 30, 2017 for copper was $2.94 per pound.

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ITEM 4. CONTROLS AND PROCEDURES.

During the fiscal period covered by this report, the Company’s management, with the participation of the Chief Executive Officer and Chief Financial Officer of the Company, carried out an evaluation of the effectiveness of the design and operation of the Company’s disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e) of the Securities Exchange Act of 1934, as amended (the “Exchange Act”)). Based on such evaluation, the Company’s Chief Executive Officer and Chief Financial Officer have concluded that, as of the end of the period covered by this report, the Company’s disclosure controls and procedures are effective to ensure that information required to be disclosed by the Company in reports that it files or submits under the Exchange Act is recorded, processed, summarized and reported within the required time periods and are designed to ensure that information required to be disclosed in its reports is accumulated and communicated to the Company’s management, including the Chief Executive Officer and Chief Financial Officer, as appropriate to allow timely decisions regarding required disclosure.

There were no changes in the Company’s internal control over financial reporting that occurred during the three months ended September 30, 2017, that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

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PART II—OTHER INFORMATION

ITEM 1. LEGAL PROCEEDINGS.

Information regarding legal proceedings is contained in Note 24 to the Condensed Consolidated Financial Statements contained in this Report and is incorporated herein by reference.

ITEM 1A. RISK FACTORS.

There were no material changes to the risk factors disclosed in Item 1, Business; Item 1A in our Annual Report on Form 10-K for the year ended December 31, 2016, as filed with the SEC on February 21, 2017.

ITEM 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS.


	(a)		(b)	(c)	(d)
				Total Number of	Maximum Number (or
	Total			Shares Purchased	Approximate Dollar Value)
	Number		Average	as Part of	of Shares that may
	of Shares		Price Paid	Publicly Announced	yet be Purchased
Period	Purchased		Per Share	Plans or Programs	under the Plans or Programs
July 1, 2017 through July 31, 2017	—	$	—	—	N/A
August 1, 2017 through August 31, 2017	—	$	—	—	N/A
September 1, 2017 through September 30, 2017	—	$	—	—	N/A

⁽¹⁾

Represents shares delivered to the Company from restricted stock units and performance leverage stock units held by Company employees upon vesting for the purpose of covering the recipients' tax withholding obligations.

ITEM 3. DEFAULTS UPON SENIOR SECURITIES.

None.

ITEM 4. MINE SAFETY DISCLOSURES.

At Newmont, safety is a core value and we strive for superior performance. Our health and safety management system, which includes detailed standards and procedures for safe production, addresses topics such as employee training, risk management, workplace inspection, emergency response, accident investigation and program auditing. In addition to strong leadership and involvement from all levels of the organization, these programs and procedures form the cornerstone of safety at Newmont, ensuring that employees are provided a safe and healthy environment and are intended to reduce workplace accidents, incidents and losses, comply with all mining-related regulations and provide support for both regulators and the industry to improve mine safety.

In addition, we have established our “Rapid Response” process to mitigate and prevent the escalation of adverse consequences if existing risk management controls fail, particularly if an incident may have the potential to seriously impact the safety of employees, the community or the environment. This process provides appropriate support to an affected site to complement their technical response to an incident, so as to reduce the impact by considering the environmental, strategic, legal, financial and public image aspects of the incident, to ensure communications are being carried out in accordance with legal and ethical requirements and to identify actions in addition to those addressing the immediate hazards.

The operation of our U.S. based mines is subject to regulation by the Federal Mine Safety and Health Administration (“MSHA”) under the Federal Mine Safety and Health Act of 1977 (the “Mine Act”). MSHA inspects our mines on a regular basis and issues various citations and orders when it believes a violation has occurred under the Mine Act. Following passage of The Mine Improvement and New Emergency Response Act of 2006, MSHA significantly increased the numbers of citations and orders charged against mining operations. The dollar penalties assessed for citations issued has also increased in recent years.

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Newmont is required to report certain mine safety violations or other regulatory matters required by Section 1503(a) of the Dodd-Frank Wall Street Reform and Consumer Protection Act and Item 104 of Regulation S-K, and that required information is included in Exhibit 95 and is incorporated by reference into this Quarterly Report.

ITEM 5. OTHER INFORMATION.

None.

ITEM 6. EXHIBITS.

Exhibit Number		Description

12.1	-	Computation of Ratio of Earnings to Fixed Charges, filed herewith.

31.1	-	Certification Pursuant to Rule 13A-14 or 15-D-14 of the Securities Exchange Act of 1934, as Adopted Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 signed by the Principal Executive Officer, filed herewith.

31.2	-	Certification Pursuant to Rule 13A-14 or 15-D-14 of the Securities Exchange Act of 1934, as Adopted Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 signed by the Principal Financial Officer, filed herewith.

32.1	-	Statement Required by 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 signed by the Principal Executive Officer, furnished herewith.

32.2	-	Statement Required by 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 signed by the Principal Financial Officer, furnished herewith.

95	-	Information concerning mine safety violations or other regulatory matters required by Section 1503(a) of the Dodd-Frank Wall Street Reform and Consumer Protection Act, filed herewith.

101	-	101.INS	XBRL Instance
		101.SCH	XBRL Taxonomy Extension Schema
		101.CAL	XBRL Taxonomy Extension Calculation
		101.DEF	XBRL Taxonomy Extension Definition
		101.LAB	XBRL Taxonomy Extension Labels
		101.PRE	XBRL Taxonomy Extension Presentation

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SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.


		NEWMONT MINING CORPORATION
		(Registrant)

Date: October 26, 2017		/s/ NANCY K. BUESE
		Nancy K. Buese
		Executive Vice President and Chief Financial Officer
		(Principal Financial Officer)

Date: October 26, 2017		/s/ JOHN W. KITLEN
		John W. Kitlen
		Vice President, Controller and Chief Accounting Officer
		(Principal Accounting Officer)