Good afternoon, and welcome to Newmont Mining Corporation second quarter 2006 earnings conference call. (Operator Instructions) I would now like to turn the call over to our host, Mr. Randy Engel. Sir, you may begin when you're ready.

Thank you, Operator and good afternoon to everybody and thank you for joining us on our second quarter 2006 earnings conference call. Please note that our call will be simulcast today on our website at www.newmont.com and it will be available for a limited time for playback. On our call today we have Wayne Murdy, Chairman and Chief Executive Officer; Pierre Lassonde, our President; Richard O'Brien, Senior Vice President and CFO; and Tom Enos, Senior Vice President of Operations. Today Wayne will provide an overview of our second quarter highlights; and then Richard will cover our financial results; followed by Tom who will provide a review of our performance at each of our operating regions and give an update on our projects. Pierre Lassonde will cover Merchant Banking and Exploration and give us his brief thoughts on the gold market. Also I'd like to caution everyone that we will be discussing forward-looking information today that involves risks that are unique to our industry and those risks are described in our filings with the SEC. With that now I'd like to turn it over to Wayne Murdy, our Chief Executive Officer.

Thank you, Randy and good afternoon. During the second quarter and for the first half of the year, we delivered substantial growth in earnings, cash flow, and gold price leverage for our shareholders. For the second quarter, our net income grew to $161 million or $0.36 per share compared to $88 million or $0.20 per share for the second quarter last year, an increase of over 80%. For the year to date, net income is $374 million versus $173 million for the same period last year. For these same periods, the gold price increased approximately 40%, highlighting our leverage to the gold price. Before I turn it over to Dick to cover our financial results in a little more detail, I'd also like to note the successful start-up and first gold pour at our Ahafo project in Ghana and congratulate our team there. This represents the first production from our newest core operating region; a region that we have great, great expectations for. Ultimately, we would expect to produce in excess of a million equity ounces annually from what we can see. That number will probably grow. We also are pleased to announce the commencement of production at our Phoenix project in Nevada. Both the Ahafo and Phoenix projects are expected to achieve commercial production during the third quarter. Tom will provide more detail on these projects shortly. But first let me turn it over to Dick for more details on our financial results. Dick O’Brien: Thanks, Wayne. As Wayne noted we generated strong earnings growth with income from continuing operations growing by over 80% to $161 million or $0.36 per share compared with $88 million or $0.20 per share in the second quarter of last year. Revenues for the quarter were $1.3 billion. Consolidated gold sales were 1.9 million…

Thank you, Dick. Starting with Nevada, where we produced 543,000 consolidated ounces at cost applicable to sales of $450 per ounce. Second quarter gold sales were down by 10% from the year-ago quarter, primarily as a result of 16% decrease in mill ore grade. Costs applicable to sales increased 43% from the prior year-ago quarter, primarily as a result of lower production, higher labor, energy, and consumable costs. Costs were also impacted this quarter by planned maintenance downtime at our mill 6 processing facility. We expect costs to be lower for the remainder of the year in Nevada as production increases and grades improve. For the year we expect Nevada to produce between 2.36 million and 2.44 million equity ounces at costs applicable to sales of between $380 and $395 per ounce. Moving to Peru. Yanacocha sold 785,000 consolidated ounces in the quarter at costs applicable to sales of $185 per ounce. Gold sales increased 9% from the year-ago quarter as a 30% increase in ore grade and timing of flows from the leach pad more than offset a 16% decrease in tons of ore placed. Costs applicable to sales for the second quarter increased 19% per ounce as a result of increased consumption of commodities, as well as higher labor and royalty costs. Second half gold production is expected to decline at Yanacocha as the mine transitions to lower grade ores and higher stripping rates. For the year we expect Yanacocha to produce between 1.33 million and 1.37 million equity ounces at costs applicable to sales of between $190 and $205 per ounce. In Australia and New Zealand we sold 315,000 consolidated ounces at costs applicable to sales of $388 per ounce. Consolidated gold sales decreased 19% in the second quarter. Primarily as a result of lower grades at…

Thanks, Tom and good day, everyone. On the exploration we're on target to spend our $160 million of drilling that we've talked about, of which 56% will be near mine, 23% greenfields, and the rest devoted to opportunities. In Ghana at Ahafo it continues to be one of our prime sites. We have 13 new drill targets lined up. We are also drilling at Subika, the pit and underground and we are drilling two deposits at Susuan and Awonsu to NRM status this year. In Australia in the Tanami we are targeting a reserve and NRM addition at Cally at depth. This deposit continues to be open at depth and we are continuing having a good success over there. In Nevada where we were Monday and Tuesday, we are just about to completing the drilling for reserve conversion and overall, in the Company we are about at the same rates and we feel pretty confident at this point that things are looking good. We are on target for getting reserve conversion by year-end and it's looking good. Also in Nevada, in terms of drilling, Nortem and Mike deposits are two that are going under increased evaluation. Now, I will just turn over to Newmont Capital very briefly. Newmont Capital had a record quarter in every respect. This quarter, our royalty income and dividend reach a record of $29 million, 38%, up from a year ago. We've also revised our guidance for the year to between $90 million and $100 million for income for the royalty portfolio, which will be not only a record but reaching a target that we have fixed ourselves four years ago to get over $100 million in royalty income from that portfolio. As well, our equity portfolio grew $360 million to over $1.3 billion from the year-end 2005 value and all of that is giving us an unrealized pre-tax capital gains of over $800 million at the end of the quarter. Also a record. As well, you know that we have contracted to sell our Black Gold property in Alberta for CAD$310 million. This property is part of our portfolio, but not the equity portfolio. We have an estimated pre-tax gain of USD$270 million on this sale and it is expected to close on August 16. So all in all, a fabulous quarter for Newmont Capital. In terms of the gold market, very quickly the market is very firm and we continue to see the bull market evolving. With that, I will turn it over to Wayne for guidance and final words.

We have revised our 2006 gold sales guidance to 5.9 million to 6.2 million equity ounces at costs applicable to sales of $290 to $310 per ounce. We are giving the wider and slightly lower range to reflect both lower production from Australia and Indonesia and the variability associated with ramping up basically three new projects, Ahafo, Leeville and Phoenix. Early indications are that Ahafo is performing very well. Full-year costs are now expected to be slightly higher than previously forecasted. As a result of lower projected production, slightly, but primarily as a result of higher energy costs, labor, and consumables. Clearly when we set our guidance at the beginning of the year we were looking at a 55 to $60 crude oil price. We're now forecasting based on a $70 crude oil price. Some of the higher labor costs relate to additional costs in Ghana to effectuate a very smooth start-up there. But also the fact that at Yanacocha with the higher earnings and the higher gold price we pay a higher worker's participation cost. That's not all bad. Full year copper sales are also expected to be slightly lower due to lower throughput and mine planned resequencing at Batu. Again we've gone into the next lay back so we're higher up in some lower grade material. That defers some of the higher grade material but that copper and gold grades are there and will be realized in future periods. Full year copper sales are expected to be 225 million to 235 million equity pounds at costs of $0.65 to $0.70 per pound. These guidance figures also include production from our Zarafshan operation in Uzbekistan. As we previously highlighted in an 8-K -- and we'll be filing our 10-Q tonight and you should read that language. The Uzbek joint…

Thank you. (Operator Instructions) Our first question comes from John Hill, Citigroup.

Good afternoon, everyone. Thanks for the presentation. It looks like you have some things going in opposite directions in the second half of the year. Nevada cash costs coming down from 450, but Yanacocha to hit the numbers; it looks like it will go well above 250. It looks like the swing factor in here is going to be really hitting the timetable on Phoenix and Leeville. How confident are you that you can address the metallurgical issues at Phoenix and the ground conditions at Leeville to bring this to fruition?

It's good to hear those questions and I think you've got it right. Again, we're starting up three projects. We were in Nevada earlier this week, took our Board of Directors through both of those projects. It's a challenging time for both but I'll tell you, I felt good about the chemistry that I saw when we were underground at Leeville. I mean finally getting the handling system in place and to be able to use the production shaft and get up to the 2,100 tons a day goal, which is where we want to be by the end of the year. We feel very good about that. We have been dealing with, as we've talked about, very difficult ground conditions there, but we've now come up with a methodology that we think works very well in dealing with those and that's something that we just started to do really this last quarter. But it's getting a lot of attention and we feel strongly about that. At Phoenix it's a big mill. It's going through the normal issues that you have as you start up a project like that, but it's wholesome. We've got some metallurgical issues to deal with there, but some opportunities that a year or two ago we didn't really think that we had with some of the oxide copper. So difficult during the start-up phase but longer term really a good story.

Great. Thank you very much for that. Pierre, just curious. Any anecdotes or data points coming out of the refinery system that might give us some hope of a recovery in fabrication demand?

One point of reference that I could give you is the gold ETF in the first six months has taken up over 150 tons of gold, which is a record as well. So we know from the demand side on the investment side the gold ETF continues to be very, very strong. At the world gold council we're expanding the reach of that product into the Far East diligently trying to put it on other exchanges. So we feel very strong that that demand is going to continue. But I don't have anything specific in terms of the jewelry market to say at this point.

Very good. Thank you.

Thank you. And our next question comes from John Bridges, JP Morgan.

Hi, Wayne, Pierre. The bond issuance in Yanacocha, what does that say about the longer term prospects for Yanacocha given the pullback in production? What's that money for? Is it the new oxide mill?

I'm glad you mentioned that. That's a very successful offering. It was more than two times over subscribed. Again, it's part of a longer term strategy to allow broader participation in the Yanacocha asset from within Peru. This was sold within Peru and sold primarily to pension funds there. But obviously we're going through this decline, as we've said before. We've gone through the easy material. We're moving forward with our gold mill project. Our Board, the day before yesterday, just approved what we would call going into stage-gate four, which is the last part of our studies before we're ready to commence construction. So we're very optimistic about that. Again, Yanacocha is a tremendous resource. There's a tremendous future there. It's just not going to be able to continue to produce at the levels it has. But by any long-term measure, it will continue to be a world-class asset. So we're encouraged by some of the appointments that we're now seeing coming out of the Garcia Administration. A group of us were in Peru a couple weeks ago and I think that there's a fair amount of optimism right now within that country. Clearly there's challenges. But a big part of it is seeing that the people have more of a participation in the benefits of mining. Mining is very important to that country and, there's a good system in place, it just hasn't been executed on how the taxes are shared between the regions and the central government. So that is getting more attention and we're hopeful that those regional governments develop a capacity to really spend what's available to them. But I am encouraged at this point as we look forward within Peru.

Which of the mills is the go-ahead for, is this the oxide mill or is this the big floatation mill?

This is the oxide mill initially.

Any ideas on when you're going to be ready to make a decision on the big mill?

No. We've got a team in place doing a study of the sulfides. As many of you know, there's a tremendous resource there. And we're working hard at that, but we don't have a timetable yet that would be appropriate to share.

Thanks, Wayne. Good luck.

Thank you. And our next question comes from Victor Flores - HSBC.

Yes. Thanks. Good afternoon. Just following up on John's question about the funding at Yanacocha. Could you give us at this time some details on what you expect of the oxide mill in terms of the total capital production, grades, et cetera?

I'm going to ask Bruce Hansen to address that one.

Yes, Victor. I mean what we're looking at is roughly a 5 million ton per year facility. Over the life it will produce somewhere on the order of 4 million plus ounces. Quite frankly, some of that would be produced if we would have heap leeched it, but obviously it accelerates some of that material. Typical feed-in to it is going to average about 3.5 grams to 4 grams of material and the cost is somewhere in the order of $245 million.

When do you expect that that would be up and running?

Our target is most likely the beginning of 2008.

Great. Excellent. And just following up on Peru. Do you have a sense as to when you'll be able to give us some updated metrics on Minas Conga?

On what?

On Minas Conga?

Right now in regard to Minas Conga, we're continuing to update the feasibility work. We're getting more active in terms of the permitting process and of course, the social engagement process within the Minas Conga region. We would anticipate to probably give you more information on our plans toward the end of the year. I think we want to see how things progress from a permitting standpoint and also how they progress from a regional election standpoint that will occur in November.

Okay. Great. Thanks, Bruce.

Thank you. And our next question comes from Patrick Chidley - BJM.

Firstly, going back to Yanacocha. There's no real mention of any exploration updates there. I'm wondering if you have a very large package of ground there and you got the Minas Conga project there. Any updates on those issues?

Yes, Patrick. Yes, we do have a big exploration program going on at Yanacocha. It's focused on exploration for additional oxide, but in a different part of the district off to the east. As a matter of fact, the east of Conga. That's at the very early stages and it's hard to say much about it, but it's a major focus of our oxide exploration program. The other big focus, frankly, is on sulfides. In and around Chakicocha, Karijugo, the Yanacocha complex is a big piece of it. And we have exploration programs going on on other parts of the property but frankly, they are delayed a little bit this year because of the time it takes to do permitting and get community support onboard.

With respect to that last comment, has there been any movement on the Hercules]?

No, there has not been at this point.

No comment. Okay. And in Nevada, just going back to Nevada. In terms of the expected costs going forward in Nevada. I'd like to find out really how much of the cost increase that we have seen might be due to more of a permanent movement; i.e., is there a percentage of CAS, for example, that are fixed versus a variable cost that is due to items like fuel and import costs?

That's a very good question. You've seen an increase year on year and I'll just give it to you at a high level. What we do have from the increase from last year is about $30 due to the deferred stripping accounting changes which came into effect January 1, obviously Nevada, with the big pit sees more of that impact on their quarterly CAS than the others. So about $30 increase was due to that. We also have an agreement with Turquoise Ridge Joint Venture with Barrick where we buy that ore at the spot price. And obviously as the spot price goes up on the 75% portion that doesn't get reflected on our bottom line, it inflates CAS. We are in the process of restructuring that agreement and hope to have that in effect here soon. But that added $25 to the gold price if you compare this quarter with the previous quarter in '05.

I'm sorry, that added $25 an ounce?

To our CAS number, correct.

Total.

Yes. To the total. So we went from $315 last year to $450 for the quarter. What we did see was about $50 to the lower production that Tom spoke to earlier, largely coming out of the underground. Again he did discuss some of the improvements that we expect to see in the second half. So to your question on how much of it was temporary, obviously with higher production, we helped that denominator up. What we did see, as Wayne alluded to was diesel and electricity costs up about $20 year on year. As Wayne also mentioned we have increased our forecast for the year to $70. Obviously, any movement up or down will impact the final numbers where we end up for the other part of the year. And the rest about 10 more than labor. So when I step back and look at it, I look at most of that 50 as opportunity, there is again 55 of accounting from prior year and if you need some more help on that we can help you through that. And then the other is diesel and electricity. We had a rate increase and again part of the justification for that power plant is the approximate $20 reduction we expect to see in CAS once that plant comes up in 2008.

When would we see that in 2008? Isn't that sort of a late 2008 issue?

Mid-2008 is when we anticipate the power plant to come on.

The other impact we will see in the second half of the year is the new fleet in Nevada, which will reduce maintenance costs. We did see significantly higher unscheduled maintenance for the second quarter on that mobile fleet. So again the investment in capital. We should start to see that in the second half of the year.

All right. Okay. Fantastic. I might follow-up. There's a couple of things, Russ, if I could. I'll give you a call.

Sure, Patrick.

Thanks a lot.

Thank you. And our next question comes from Mark Smith - Dundee Securities.

Yes. I have a couple of questions. The first is on Phoenix. I just want to understand how you are planning to report Phoenix go forward with the copper credit?

It will be reported as a by-product. We look at Nevada as one operating segment and the copper is really de minimus. It's going to be somewhere between 15 million and 25 million pounds a year, versus the 300,000 to 350,000 ounces coming out on the gold side. So it will be reported as a by-product.

Okay. That's a concentrate shipments, a cost I can put against those copper credits? Transportation and smelting and that.

Yes. Mark, I can just give you a high level. 40% of the gold comes out in the gravity circuit, roughly 30% in CIL and 30% ends up in concentrate. That will give you a feel for the volume going up to get smeltered.

Yes. I was looking for tons of concentrate, Russ.

We can get you the number. I don't have it offhand, Mark.

Yes, that would be great. Okay. Yes, I just need TRCs on that, Russ.

Yes. We can get it to you, Mark.

Okay. Just in light of the sales of the oil sands. Is Newmont going to now look at fuel hedging? Previously the oil sands were considered that aspect of Newmont.

No. They are two different things. The property that we sold, Black Gold, was a 100% owned property. Our hedged opportunity is with the ownership of 7% of Canadian Oil Sands Trust. We're not selling that.

Okay. Thanks, Pierre. That's good. Just maybe if you can enlighten me, I've been noticing an awful lot of labor price increases with the steel companies in South America. Where do you see those trends going in Peru?

I think within Peru, we continue to see some pressures on labor costs. The other side of that is in our case, as the costs go up there it will reduce the amount of worker's participation. So there's a little bit of an offset there. But I think generally around the world in all the basic industries you're going to continue to see tremendous cost pressures. It doesn't matter where you go, because there is not enough skilled labor to deal with the tremendous demand that's going on in virtually every basic industry. Certainly across the natural resource industries. You see the kind of costs that are being incurred in a place like Alberta or on the oil patch in the U.S. And certainly we see it in our cost structures, whether it's Nevada or really any part of the world. This boom in commodities has an impact and we're paying the price globally for the very low costs, low margins that we saw throughout the 1990s.

Yes, it certainly is apparent now, isn't it. Just two final ones and they are actually quite short. Leeville underground conditions. You said you guys were getting a handle on those difficult ground conditions. Could you just enlighten me on how difficult they are and how much ground support you are looking at and needing?

Yes, this is Tom. Again, there's two distinct zones in Leeville. What we call zone 1, zone 4 and zone 4 predominantly has the ground that is much more difficult to get through. We have developed a method there. Again, we were there on a tour and a comment was made to me, the ground doesn't look that bad because they don't see any steel sets. There aren't any steel sets in Leeville. We use a lot of shot [crate] and a lot of wire mesh. We are now able to advance at a rate that still needs to have some work on, but it's getting us where we need to be. One of the things that we've done at Leeville is we've brought an experienced underground mining contractor in to supplement our workforce. A lot of our workforce in Leeville is relatively new, inexperienced, if you will. When I say inexperienced, less than a couple of years of real underground mining experience. Again, we're through all that. We're seeing the productivity gains every day. Unfortunately, you measure them in millimeters rather than in feet.

Yes. That's because we've all gone metric. Maybe you could just help me again a little bit more. Have you actually done any test doping in zone 4 or are you seeing any over break or is it holding together for you?

Yes, we have. We are currently producing about 1,800 tons a day of ore out of Leeville. It's being hoisted through the ventilation shaft, but it is producing.

Okay. But in terms of dilution, you're not seeing any more dilution than any more dilution than you anticipated?

I don't think so.

Then a final question for me. Russ, Boddington the same as Phoenix. Is it going to be merged in with the Australia, Indonesian/New Zealand reporting?

Yes. We look at it again, the copper is not a significant component and it will most likely be by-product. This is a function of what long-term metal price assumptions you use to determine the split between copper and gold. But at this stage our calculations indicate that it will be a by-product down there. Again, it's in the order of magnitude depending on what year you're looking at. Somewhere between 8% and 12%. Some years as high as 14%.

Okay. If you could do the same thing, just get the sort of feeling from the TCRCs off to me, that would be great.

Sure.

Thank you.

Thank you. Our next question comes from Michael Fowler - Desjardins Securities.

Yes. Good afternoon. A couple of questions. I notice in the Batu Hijau copper realizations there are fairly low. Is this due to copper hedging?

Hi, Mike, yes. We actually have had that question from a few people and what we've done in the Q that will be filed tonight so you'll have access to it tomorrow morning, is we actually break down that impact on a dollar basis but also on a per pound basis. Just for round numbers for the quarter, the gross or the spot price if you want before hedging was about $3.11. We had copper collars going against us as we've talked about of about $2.21. Those copper collars will at this stage based on the current production and delivery schedule end in February next year. So early in the first quarter. Going against those copper collars are the provisional pricing, the mark-to-market on those 90 days roughly of outstanding receivables, as those contracts are delivered and then priced basically three months after the month of delivery. So that gives you a gross after hedging of about $2.25 a pound. TCRCs for the quarter were around $0.53, which includes all the price participation pieces for a net of $1.72. So you will see some more disclosure on that and I think it will help you as you look forward and try to model out the impact once those hedges go away because it will be significant. This table should help you with that.

So anyway you've got hedges until February and, I guess the mark-to-market I believe it is about $500 million. Is that mostly due to the copper hedge?

That's correct. I think it was $516 million at the end of the quarter.

Another question. I guess with all this talk about cost pressures, probably the only real way of getting cost down is to bring in new production. So my question is what would be the aggregate cash cost of all this new production coming on-stream?

Steady state, Michael. Although as Wayne mentioned earlier we're revising our plans right now. The prior reference we've given is somewhere in that $250 range.

I would look for something again, all the new projects we're bringing in at steady state will have cash costs or operating costs below the industry average. I think, again, relative to the full industry, while our costs have gone up versus the industry they have gone down over the last several years. We are at a point probably our worst year in Nevada this year. As we ramp up these new projects and even using the $70 oil, we see significant cost improvements over the next several years. Obviously highlighted by when we can get that power plant up in 2008. But it's very difficult in today's world to give those kinds of numbers out in the future. And I think you're going to hear less and less of that kind of guidance from the industry. The reality is that what we're putting in will be extremely competitive and the reality is that we're growing our margin at a significant rate. Again, this last quarter, despite the cost increases, we grew our margin by 70%. I think that's something that again we'd love to be able to just pull out spread sheets and give you quotes, but if you can tell me what the labor rates are going to be a year from now, if you can tell me what oil's going to be a year from now, we can give you a spreadsheet answer. But I think we're all having to chew a little bit here because the world is changing very dramatically. What is important is that we can provide that leverage to the gold price and we continue to do that and we're seeing that; if you look at this first half year at about double what the gold price has gone up and we think we can continue to do that. Then augment it in those out years by growing production and good results from our other businesses.

Thanks, Wayne, for that. Just, lastly, on the dividend, do you consider increasing the dividend since your margins are increasing quite rapidly?

We continue to look at that at every Board meeting and we have in the past and we probably will in the future. But it obviously depends on our capital opportunities also. We want to get the best return back to our shareholders and that's clearly part of the plan.

Thanks very much.

Thank you. And our next question comes from Barry Cooper - CIBC.

Yes, good day, gentlemen. Just wondering with Ahafo finished now what, or essentially finished, what are close to final costs for building Ahafo?

I mean the close to final costs for building Ahafo are roughly approximately $450 million.

Correct me if I'm wrong, Bruce, was that like about $50 million over budget then?

Well, we did change some scope there, Barry. We decided as part of that $450 million we paid for, essentially financed the construction of the power lines into Ahafo. One of which we have completed, the other that was still coming in, although we have adequate power to run the plant.

Okay. Any thoughts, then, on how Akyem's going to fall into shape? You're happy with the number that you have for it?

Well, we're going to be going through and reestimating, reforecasting Akyem. Quite frankly, because obviously the permitting situation has taken longer than we would like. Since then, obviously the world marches on in terms of the requirements or the commodity costs and inputs into the project. Re-examining the scope of what's required from a crop compensation, land acquisition, social standpoint as well. So we're looking at all of that and then we'll get back to you once we receive those permits and we'll start commencing construction.

I think, Barry, when you put it in context, though, the big picture, both of these projects are very efficient uses of capital. I think when we originally gave our estimates on those, my memory is it was 425, but I could be wrong. And at that point in time we're saying 450,000 ounces a year. On Akyem we're talking about slightly higher costs and again kind of in that same range. What we see now is, yes, we've had some increases in capital, but really fairly modest in relation but we've also increased those annual production numbers. So now when you add those two, if you look at those ranges on steady state you almost get to 1 million ounces whereas we were closer to 900,000 a couple years ago. Ahafo, again we continue to have tremendous discoveries there. So the real issue at Ahafo is when do we expand that and how quickly can we? And that's going to take our production up well over 1 million ounces, probably by 2010. So we're looking at, Bruce's team has a steady ongoing right now. Does it make sense to build Akyem or can we get a faster return if we use that mill we have on order and expand at Ahafo? That's a nice trade-off to have to test.

Right. Is there a critical path for -- well, there obviously is. But is there a point where the permitting, if you don't get your permits beyond a certain period there than the start-up date becomes critical. When would that be?

We're in it. Historically we talked about getting Akyem up in 2008. Now we're really talking about it's going to be 2009. That is the critical path, is the permitting.

I think in terms of focusing that plant capacity to Ahafo versus Akyem, I mean I think the end of the next quarter we're really going to have to assess that.

Finally, you had some problems there in Indonesia with respect to I guess we'll call it social issues. There are now a few problems over in Uzbekistan with taxation issues and whatnot. How's Newmont looking at the world now in terms of where it wants to be?

When the prices are high, you suddenly have those kinds of issues every place. Not just in places like Uzbekistan and Indonesia. But, no, clearly it's a challenge and that's why we look at this as a portfolio approach. Certainly you look at opportunities wherever they emerge and then you look at it. We've always said our goal is to have more than 50% of our reserves in production in the developed world, but that doesn't mean that you don't face tax pressures in the developed world, too. I hear lots of words out of Washington, D.C. when prices are high. So we're being sensitive. I think you have to look at the world as constrictive versus in the '90s when lots of parts of the world were opening up. Today you have lots of parts of the world shutting down. You have situations like you see in Venezuela and Bolivia. You have the whole attitude that we see and really what we're facing in Central Asia is a turn away from the West and back towards Mother Russia. You see nationalism across many regions. So the world is really becoming smaller today rather than expanding the way we saw it at the end of the '80s and through most of the '90s. So, again, we're very comfortable with Peru. Will there be issues there? Sure there will. But it's a mining-friendly country. Indonesia has had its share of issues but the government there clearly wants to see an increase in foreign investment and obviously Batu Hijau is one heck of an asset there. So we continue to make our judgments. We're very pleased with the development that has gone on in Ghana. Ghana is probably one of the most progressive countries in West Africa. It's one of the few countries in Africa that's has a reasonable shot at actually achieving its millennium goals. And we want to be an important part of the growth of that economy.

Okay. So I take it from that there's some Xs on the map, but they're in highlighter form so that you can still see through them. Thanks.

Sure.

Thank you. And our next question comes from Damon Wells - Damon Wells Interests.

Yes, good afternoon over there and congratulations on a good operating quarter and fantastic results from the investment side. Well done. The previous caller has expressed concern about the dividend which seems to be stuck at levels lower than we saw in 1996. Could you be a little more specific about how you set your dividend policy and how much consideration is being given to that or to stock buybacks to help the shareholders?

Damon, let me take a shot at that but you were really breaking up badly.

Sorry.

I hope I'm not breaking up as badly as you are.

No, I can hear you, Wayne.

I think your question was about trying to be a little more specific about dividends.

That's correct.

I mean clearly, we have said historically we want to continue to increase the dividends. We want to do it in a way that we see it's sustainable. We've grown them significantly since 2002, which currently was at a low point. The real issue right now is over this last year and the next couple of years we are spending a tremendous amount of capital. So we want to get through that phase. Again, we look at this each quarter with the Board and we can see increases coming. But right now with the tremendous amount spending, well over $1.4 billion to $1.6 billion this year. Next year won't look significantly different than that. So we have to be mindful of that. But the neat thing is we have a real strong balance sheet. We've got some assets there, unrealized gains that Pierre talked about that we can from time to time harvest. I think you'll see that here in the third quarter of this year. So we'll be prudent. We'll be conservative balance sheet. But as we get through this spending and you start to see the real power of these investments that we're putting in, I think you'll see a resumption in the dividend growth.

Thank you very much.

Thank you. And our final question comes from John Tumazos of Prudential.

Good afternoon. You've had a more than ten-year good history in Uzbekistan. I wasn't aware of the tax issues and I believe it's the same president there the whole time. Could you maybe just tell us a little more about what's happened there?

I think, John, it's the same regime. It's the same regime since the breakup of the Soviet Union and Uzbekistan declared its independence. But what you're seeing in that part of the world, and it's not just Uzbekistan, but you are seeing a turn away from the West. I think as a number of these countries found it maybe more difficult to project themselves into kind of the demands of the Western World with respect to some of the things that we talk about, human rights and other issues. There's clearly been a turn back to Russia. I think you're probably very aware of the things that have gone on there with a more nationalistic attitude and I think we're seeing some of that in Central Asia. So the partnership has worked very well over all these years on a macro basis. We've had a reasonable return there. We only have about four or five years of life left in that original agreement. But we've never been able to do a second deal there. Again, the goals of that country I think we've seen them change even though the regime is the same one. We'll just see how we work our way through this.

Thank you and good luck.

Thanks.

Thank you. That concludes our question-and-answer session of today's program. I would like to turn the call back over for any closing remarks or final comments.

Thank you, Operator. We would just like to invite anyone who didn't get a chance to ask questions to please feel free to give us a call on the IR group. You can reach John Gaensbauer or myself. Thank you very much for your time.

I would like to thank everyone for participating in today's teleconference call and at this time all parties may disconnect.