Shares in Northern Star Resources eased in yesterday’s upbeat market conditions despite the company upgrading its Jundee gold mine in Western Australia.
Northern Star told the ASX yesterday that its initial exploration campaign at Jundee "has been a resounding success, identifying extensive new areas of high-grade mineralisation up to 800 (metres) from the existing operations”.
Northern Star said the results of the exploration campaign “show clearly that Jundee will continue to operate at or around its current production levels for many more years".
The shares eased 1.4% to $4.94 yesterday as investors reacted more to a small fall in global gold futures. Judging by the enthusiasm in yesterday’s statement, the Jundee mine, bought in early 2014 from Newmont for $85 million, is turning out to be something of a bargain for Northern Star.
Northern Star Managing Director Bill Beament said in the statement yesterday that "the results were game-changing for the future of Jundee and we are only 15% through our drilling campaign from the purpose built drill platform".
“We took the decision to invest heavily in the future of Jundee and these results show that we are being repaid many times over,” Mr Beament said.
“We are finding high-grade gold in every direction we drill and in some cases, almost 1km from the existing operations.
“We know Jundee has a distinguished history as a world-class gold mine – and now we know that its future will be just as exciting.”
Northern Star said in its statement that much of the newly-identified mineralisation came from drilling in and around the mine, ”which has succeeded in expanding the known parameters of at least seven mining areas and resulted in new discoveries of the Armada and Revelation trends”.
Initial drilling undertaken from the new drill drive at the base of the mine has hit mineralisation 400 metres below the existing mine development, where previous production from this section of the mine totalled 3.2 million ounces at ~10 grams per tonne (gpt).
Northern Star said this drilling had “also resulted in the “Armada” discovery (discovery hole of 4.6 metres (m) at 10.9 gpt). The mineralisation has so far been defined over a 300m strike and open in all directions.”
"In addition, drilling from both surface and underground locations further up in the mine has defined extensive new mineralisation over a 1km strike length along the Revelation trend to the south of the mine workings. This drilling success to the south has significantly extended the Jundee mineralisation across the Stirling Fault, confirming the 7Moz system steps over the fault and remains open. The Stirling Fault was previously thought to close out the system,” Northern Star told the ASX.
Directors added that the "Revelation trend also holds significant promise to the north, with a further 800m of strike to be tested in this direction back towards the existing mine infrastructure".
Northern Star didn’t give any resource figures as a result of the drilling. These will come later – possibly in the June quarter and full year production and exploration report later this month.
