Northern Star Resources has completed its acquisition of Newmont’s Jundee mine, officially catapulting the company to the second largest ASX- listed gold miner.
Northern Star paid $82.5 million in for the mine which produced 63,000 ounces in the June quarter.
The acquisitions are set to lift the company’s annual production rate to between 550,000 and 600,000 ounces, making it Australia’s second biggest gold miner behind Newmont.
Northern Star managing director Bill Beament said Jundee was a quality mine that boasted good production rates, low costs and the option of expansion through near-mine exploration.
"The Jundee acquisition is entirely consistent with our objective of being a major Australian gold mining company for global investors," Beament said.
"We now have the scale, the asset diversity, the cost base and the growth potential demanded by leading investment institutions around the world."
Northern Star said it will take on Newmont’s existing staff as part of the sale.
Following the completion of the Jundee acquisition, Northern Star has $80 million cash on hand and has drawn down $70 million of a $100 million credit facility.
The company’s rise from junior miner to major player took place in less than six months and at a cost of just $200 million.
Northern Star reported production of 41,668 ounces in May and said the rise was proof that it was successfully bedding down its recent gold mine purchases.
Bill Beament said the May results highlighted the affect the company’s efficiency measures were having on its new mines.
“The strong results are particularly pleasing and provide confidence that our integration plan will work equally well in bedding down the Jundee project,” Beament said.
“This success is the direct result of the team that we built ahead of making the acquisitions and the excellent acceptance of the incumbent workforce adopting Northern Star as a company. That approach meant we could implement our operating methods and efficiency drive immediately we were in the door. “