#Northern Star Resources Limited#Newmont Mining#Australian#Newmont Mining

Newmont Mining Announces Sale of Australian Mine as Part Of Portfolio Optimization Efforts

Newmont Mining recently made an announcement indicating the sale of its Jundee underground gold mine in Australia. The sale was awarded to Northern Star...

Admin
|Jun 12|magazine3 min read

Newmont Mining recently made an announcement indicating the sale of its Jundee underground gold mine in Australia. The sale was awarded to Northern Star Resources Limited for total proceeds of $91 million.

According to the company, Newmont accepted a binding agreement with Northern Star to sell the Jundee underground mine for cash proceeds of $77 million and an additional payment of $14 million for working capital. All of Jundee’s assets and liabilities, including all environmental and employee obligations, are set to go to Northern Star. Aside from contingencies such as Northern Star securing financing and the subjection to a third party’s right of refusal, all of the ink for this contract is set to dry next month in July.

The high cost of operating Jundeed underground gold mine represents a significant motivator for Newmont’s decision to sell. Newmont’s pervasive strategy is structured around the optimization of its portfolio through increased focus on lower cost and longer life operations.

This deal comes off the stake sales in Canadian Oil Sands, the Midas underground mine in Nevada and Paladin Energy Limited. The total proceeds from these stake sales along with the Jundee transaction comes in at approximately $800 million.

Newmont is cutting costs, divesting high cost and non-core assets in order to improve the way it is able to deal with a market environment typified by low gold prices, which have corrected significantly over the course of last year. It is expected that we will see similar deals in the future.