DENVER — The new chief executive of Newmont Mining Corp., one of the world’s largest gold producers, earned $4.84 million in total compensation last year as it battled higher production costs while gold prices soared.
Richard O’Brien, who took over in July, received a package that was slightly less than the 2006 compensation earned by Wayne Murdy, who retired as chief executive officer in June, according to a Securities and Exchange Commission filing submitted today.
O’Brien’s compensation consisted of $760,000 in salary, $1.41 million in cash and other non-equity bonuses and $44,776 in “other” compensation. The miscellaneous category consisted mainly of retirement program and other retiree benefits.
In addition, O’Brien received stock and option awards that were valued at $2.6 million when they were granted.
The AP’s total pay calculations include executives’ salary, bonus, incentives, perks, above-market returns on deferred compensation and the estimated value of stock options and awards granted during the year. The calculations don’t include changes in the present value of pension benefits, and they sometimes differ from the totals companies list in the summary compensation table of proxy statements filed with the Securities and Exchange Commission.
In 2006, Murdy received compensation valued at $4.88 million.
The company said it paid O’Brien a retention grant early in the year as it prepared for Murdy’s retirement. His salary and compensation targets were increased when he became CEO.
Denver-based Newmont has described 2007 as a transitional year in which it turned its priorities back to core assets by eliminating its forward-sales gold contracts and discontinuing its merchant banking division.
The average price it received rose to $697 an ounce from $594 an ounce in 2006, which was offset by the cost applicable to sales which jumped to $406 an ounce from $303 an ounce in the previous year.
Gold production also fell, totaling 5.32 million ounces compared with 5.87 million ounces in 2006.
In addition to the fixed salary base, O’Brien received bonuses based on goals that include sales, production costs, capital expenditures and the growth of reserves.
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