BHP warns Australian mining not ready for low-cost competitors
The boom in demand from China’s industrialization is now “past the period of aggressive growth,” BHP’s Australia President said.
Underground mining at Jundee gold began in 1997 and continues today.
Shares in Aussie gold miner Northern Star Resources (ASX:NST) jumped 7.6%, or 8.5 cents, to close at A$1.20 on the news the miner, which aims to become Australia’s second largest bullion producer, has bought US Newmont’s (NYSE:NEM) Jundee underground gold mine near Wiluna for $91 million (A$82.5 million) in cash.
Jundee is expected to lift Northern Star’s production from about 350,000 ounces a year to about 550,000 ounces a year by 2015, making it the second largest ASX-listed gold miner behind Newcrest (ASX:NCM).
The deal is the company’s fourth purchase during the current financial year. In December Northern Star bought Barrick’s Plutonic mine, and two more Barrick mines — Kanowana Belle and Kundana Gold— in January.
This year’s acquisitions meant the company has increased its production capacity five-fold to more than 550,000 ounces per year in just six months.
Production at Newmont’s Jundee began in 1995 from a complex of open pit mines that have now stopped operation. Underground mining began in 1997 and continues today, with the operation producing 279,000 ounces of gold last year.
(Images, graphics, courtesy of Northern Star Resources)
