Northern Star Resources has made another West Australian gold mine acquisition, this time buying Newmont’s Jundee mine for $82.5 million.
The deal comes after Perth-based Northern Star bought Barrick Gold’s Plutonic, Kanowna Belle and Kundana gold mines earlier this year for a total of $100 million.
The Jundee acquisition is expected to lift Northern Star’s production from 350,000 ounces of gold per annum to 550,000 ounces by 2015, making it the second-largest ASX-listed gold miner.
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.
“Jundee is a tier-one asset in the Australian gold mining industry by any measure,” Northern Star managing director Bill Beament said.
“It boasts a highly enviable record, whether it be exploration success, production or cashflow.
“I am highly confident that we will grow the inventory and extend the mine life at Jundee while reaping the benefits it will bring to our production and cashflow.”
Northern Star said it will take on Newmont’s existing staff as part of the agreement.
The company said it will fund the deal through existing cash reserves and a $100 million debt facility committed by Investec Bank.
Following the completion of the acquisition, which is expected to occur in July, Northern Star said it would look to extend the mine life at Jundee and optimise current Newmont mining production forecasts.
Jundee mine is located more 50 km northeast of the township of Wiluna. The operation boasts a resource of 507koz at 4.4gpt.
Northern Star said the mine’s all-in sustaining costs in 2013 was $930 an ounce.