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 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, 2009 filed February 25, 2010 on Form 10-K. The year-end balance sheet data was derived from the audited financial statements, but does not include all disclosures required by United States generally accepted accounting principles (“GAAP”).

References to “A$” refer to Australian currency, “C$” to Canadian currency, “IDR” to Indonesian currency, “NZ$” to New Zealand currency and “$” to United States currency.

NOTE 2    SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Recently Adopted Accounting Pronouncements

Variable Interest Entities

In June 2009, the Accounting Standards Codification (“ASC”) guidance for consolidation accounting was updated to require an entity to perform a qualitative analysis to determine whether the enterprise's variable interest gives it a controlling financial interest in a Variable Interest Entity (“VIE”). This qualitative analysis identifies the primary beneficiary of a VIE as the entity that has both of the following characteristics: (i) the power to direct the activities of a VIE that most significantly impact the entity's economic performance and (ii) the obligation to absorb losses or receive benefits from the entity that could potentially be significant to the VIE. The updated guidance also requires ongoing reassessments of the primary beneficiary of a VIE. Adoption of the updated guidance, effective for the Company's fiscal year beginning January 1, 2010, had no impact on the Company's condensed consolidated financial position, results of operations or cash flows.

The Company identified Nusa Tenggara Partnership (“NTP”), a partnership between Newmont and an affiliate of Sumitomo, that owns a 56% interest in PT Newmont Nusa Tenggara (“PTNNT” or “Batu Hijau”), as a VIE due to certain capital structures and contractual relationships. Newmont also identified PT Pukuafu Indah (“PTPI”), and PT Indonesia Masbaga Investama (“PTIMI”), unrelated noncontrolling partners of PTNNT, as VIEs. Newmont entered into transactions with PTPI and PTIMI, whereby the Company agreed to advance certain funds in exchange for a pledge of the noncontrolling partners' combined 20% share of PTNNT dividends, net of withholding tax. The agreements also provide Newmont with certain voting rights and obligations related to the noncontrolling partners' combined 20% share of PTNNT and commitments from PTPI and PTIMI to support the application of Newmont's standards to the operation of the Batu Hijau mine. The Company has determined itself to be the primary beneficiary of these entities and to control the operations of Batu Hijau, and therefore consolidates PTNNT in the Company's financial statements.

Fair Value Accounting

In January 2010, ASC guidance for fair value measurements and disclosure was updated to require additional disclosures related to transfers in and out of level 1 and 2 fair value measurements and enhanced detail in the level 3 reconciliation. The guidance was amended to clarify the level of disaggregation required for assets and liabilities and the disclosures required for inputs and valuation techniques used to measure the fair value of assets and liabilities that fall in either level 2 or level 3. The updated guidance was effective for the Company's fiscal year beginning January 1, 2010, with the exception of the level 3 disaggregation which is effective for the Company's fiscal year beginning January 1, 2011. The adoption had no impact on the Company's condensed consolidated financial position, results of operations or cash flows. Refer to Note 16 for further details regarding the Company's assets and liabilities measured at fair value.

NOTE 3    SEGMENT INFORMATION

The Company's reportable segments are based upon the Company's management structure that is focused on the geographic region for the Company's operations. The financial information relating to the Company's segments is as follows:

NOTE 4    RECLAMATION AND REMEDIATION

At September 30, 2010 and December 31, 2009, $719 and $698, respectively, were accrued for reclamation obligations relating to mineral properties. In addition, the Company is involved in several matters concerning environmental 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, 2010 and December 31, 2009, $148 and $161, respectively, were accrued for such obligations.

The following is a reconciliation of reclamation and remediation liabilities

The current portion of Reclamation and remediation liabilities of $47 and $54 at September 30, 2010 and December 31, 2009, respectively, are included in Other current liabilities (see Note 23).

The Company's reclamation and remediation expenses consisted of:

NOTE 5 ADVANCED PROJECTS, RESEARCH AND DEVELOPMENT

NOTE 10    INCOME TAXES

During the third quarter of 2010, the Company recorded estimated income tax expense of $348 resulting in an effective tax rate of 29.9%. Estimated income tax expense during the third quarter of 2009 was $253 for an effective tax rate of 28.0%. The increase in the effective tax rate from 2009 to 2010 resulted from the change in the jurisdictional blend of the Company's taxable income and the effect of the percentage depletion deduction. During the first nine months of 2010, estimated income tax expense was $756 resulting in an effective tax rate of 26.5%. Estimated income tax expense during the first nine months of 2009 was $494 for an effective tax rate of 28.2%. The decrease in the effective tax rate from 2009 to 2010 resulted from a tax benefit of $127 being recorded in the first quarter of 2010 from the conversion of non-US tax-paying entities to entities currently subject to U.S. income tax resulting in an increase in net deferred tax assets, partially offset by the change in the jurisdictional blend of the Company's taxable income and the effect it has on the overall rate impact from percentage depletion. The effective tax rates in the third quarter of 2010 and 2009 are different from the United States statutory rate of 35% primarily due to the U.S. percentage depletion deduction and the effect of different income tax rates in countries where earnings are indefinitely reinvested.

The Company operates in numerous countries around the world and accordingly it is subject to, and pays annual income taxes under, the various income 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 reasonably determined to be due. The tax rules and regulations in many countries are highly complex and subject to interpretation. From time to time the Company is subject to a review of its historic income tax filings and in connection with such reviews, 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. PTNNT, the Company's partially owned subsidiary in Indonesia, received a final tax assessment from the Indonesian Tax Office during the third quarter. Although required to pay $132 (of which, $119 related to corporate income tax matters) of tax and penalties upon receipt of the tax assessment, PTNNT intends to vigorously defend its positions through all processes available to it. PTNNT believes it is more likely than not that they will prevail and therefore has recorded a corresponding receivable (see Note 21).

At September 30, 2010, the Company's total unrecognized tax benefit was $122 for uncertain income tax positions taken or expected to be taken on income tax returns. Of this, $53 represents the amount of unrecognized tax benefits that, if recognized, would affect the Company's effective income tax rate.

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 with respect to which none of the issues 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 $1 to $3 in the next 12 months.

On January 1, 2010, various U.S. tax laws expired, and as of September 30, 2010, they have not been reinstated. These expired tax laws do not have a material effect on the Company's financial statements.

NOTE 11    DISCONTINUED OPERATIONS

Discontinued operations relate to the Kori Kollo operation in Bolivia, sold in July 2009.

The Company has reclassified the 2009 balance sheet amounts and income statement results from the historical presentation to Assets and Liabilities of operations held for sale on the Condensed Consolidated Balance Sheets and to Income (loss) from discontinued operations in the Condensed Consolidated Statements of Income. The Condensed Consolidated Statements of Cash Flows have been reclassified for assets held for sale and discontinued operations for all periods presented.

The following table details selected financial information included in the Income (loss) from discontinued operations in the consolidated statements of income: