Northern Star Resources Limited
(ASX:NST) has agreed to buy Barrick Gold Corp’s Western Australian Plutonic gold mine for $25 million.
The acquisition of Plutonic will see Northern Star’s annual gold production rise to more than 200,000 ounces and increase its total reserves to 4 million ounces.
Managing director Bill Beament says the company will now have two mines with average all-in sustainable costs of $1,000 an ounce.
The Plutonic mine’s average cost is US$1,110 an ounce but Beament is confident Northern Star can lower costs and improve productivity at the mine
Mr Beament told media the deal was a screaming buy with Northern Star doubling its production for less than 10 per cent of the company’s market cap.
Northern Star generated a net profit of $28.3 million in fiscal 2013.
