After some PC issues were sorted out, Kalgoorlie’s Palace pub got back to its bustling self in the final days of the Diggers & Dealers bash.
And as yesterday became today for the eclectic mix of well-watered miners and money-types, the rumour mill went into overdrive.
Sorting out the factual from the nonsense, and then trying to remember which was which as the sun dawned on another day under Kalgoorlie’s big blue sky, required some effort.
Having said that, the nonsense ones are easier to deal with. Chatter that Northern Star was in line to acquire the Super Pit at the top end of town from the Barrick/Newmont joint venture is the prime example.
Once Australia’s biggest gold mine, the Super Pit is no longer in Tier 1 territory. Last year’s pit wall slippage and the ever-present challenge of pulling 2g/t dirt from ground riddled with old-timer workings has taken its costs to more than $US1000 an oz in recent quarters.
Reserves and resources are on the thin side of things, even at the currently compromised annual production rate.
Then there is the rehabilitation cost – some put this at circa $350 million – should the Super Pit become not so super and the mine gates are shut.
Apart from all that, owning the Super Pit would be insignificant in terms of value uplift for Northern Star compared with what is coming at its Pogo mine in Alaska, acquired last year from Sumitomo.
Northern Star is about halfway through restoring Pogo as a Tier 1 gold producer, with an update on its broader plans for the mine and regional exploration upside to land in September. It is what Northern Star does, and does well.
Plus, the run-away gold price should fuel the urge to merge in junior land. Read more +
