Northern Star Resources has delivered productivity gains at the Pogo gold project in Alaska, United States as it settles in at last year’s major acquisition.
The company mined 59,219 ounces of gold at the operation in the December 2018 quarter, selling 57,534 ounces at an all-in sustaining cost (AISC) of $1681 per ounce.
Northern Star declared a maiden JORC-compliant resource of 4.15 million ounces at 14.7 grams of gold per tonne at the project during the quarter.
The company acquired Pogo from Sumitomo Mining Mining and Sumitomo Corporation — which held 85 per cent and 15 per cent respectively — for $US260 million ($347 million) in August last year.
Northern Star maintained its 2019 financial year production guidance of 850,000-900,000 ounces in spite of a rising AISC from the investment in Pogo and the mining of lower-grade ore at its Kalgoorlie operations.
The Kalgoorlie operations (comprising Kanowna Belle, Kundana and South Kalgoorlie) saw a boost from a higher gold price that allowed Northern Star to mine lower-grade ore, a move that saw the company’s development tonnage rise 41 per cent on the previous quarter to 246,865 tonnes.
“These lower grades reflect two factors,” Northern Star executive chairman Bill Beament said.
“The higher gold price in the December quarter allowed us to extract lower-grade ore, which reduces production and in turn increases our per-unit costs, without damaging our margins.
“This is entirely consistent with Northern Star’s long-standing policy of mining to a margin.”
The company’s production was in line with operational guidance despite weather-related issues impacting milled tonnes at the Jundee operation in Wiluna Shire, Western Australia.
Northern Star produced 493,593 milled tonnes at Jundee in the December quarter, a 16.1 per cent drop on the 588,356 tonnes milled in the September quarter.
The company also recovered 63,650 ounces of gold in the December quarter from Jundee, down 16.9 per cent on the previous quarter, although the overall recovery percentage was slightly higher at 92 per cent (up from 89 per cent).