Northern Star Resources is seeing the early signs of cost savings and productivity gains from the merger with Saracen Mineral Holdings as it progresses towards producing 2 million ounces of a gold a year.
The gold miner sold 1.6 million ounces of gold in the 2021 financial year at an all-in-sustaining cost (AISC) of $1483 per ounce.
According to Northern Star managing director Stuart Tonkin, the benefits of the Saracen merger are materialising.
“As we bed down the merger, the savings and the productivities are coming through at numerous levels,” Tonkin said.
“And the scale of our business, now underpinned by reserves of 21 million ounces exclusively in tier-one locations, is exceptional.”
The company produced 444,012 ounces at an AISC of $1459 per ounce in the June quarter from its Kalgoorlie, Yandal and Pogo production centres in Western Australia.
The Kalgoorlie production centre contains the Kalgoorlie Consolidated Gold Mines (KCGM), Kalgoorlie Operations and Carosue Dam mine, with Northern Star claiming full ownership of Kalgoorlie Consolidated Gold Mines and Carosue Dam after merging with Saracen.
Northern Star has also mapped out its five-year plan to become a two-million-ounce producer.
This will involve increasing its Kalgoorlie production centre to 1.1 million ounces per year, Yandal to 600,000 ounces per year and Pogo to 300,000 ounces per year.
Northern Star plans to continue improving quality and increasing the quantity of ounces per share.
“It was a strong operational performance from our recently merged team with production and costs comfortably in line with the undertakings we provided to the market,” Tonkin said.
“This flowed through to our financial results, with cash flow rising significantly from the previous quarter, leaving us with cash and bullion of more than $800 million at the end of the financial year.”