Released December 05, 2024 | GALWAY, IRELAND
en
Written by Martin Lynch, European News Editor for Industrial Info (Galway, Ireland)--Two of Australia's leading gold mining companies have agreed to a merger worth US$3.2 billion as record high gold prices fuel consolidations in the sector.
Northern Star (Subiaco, Australia), the largest gold mining company, has agreed to acquire its smaller No.5-ranked rival De Grey (Perth, Australia) in an all-share transaction that will give the smaller company a 20% stake in the merged operation. The deal gives Northern Star access to De Grey's flagship Hemi project in the Pilbara region of Western Australia, classed as one of the largest undeveloped gold projects globally. It boasts mineral resources of 11.2 million ounces and an annual gold production forecast of 530,000 ounces over the first 10 years, according to estimates. The combined Northern Star Group will operate across two Tier-1 jurisdictions and four production centres, the company said, with mineral resources of 74.9 million ounces and ore reserves of 26.9 million ounces.
Northern Star Managing Director and Chief Executive Officer Stuart Tonki said: "De Grey's Hemi development project will deliver a low-cost, long-life and large-scale gold mine in the Tier-1 jurisdiction of Western Australia, enhancing the quality of Northern Star's asset portfolio to generate cash earnings. We remain committed to our profitable growth plan to 2 million ounces by FY26, with the Kalgoorlie Consolidated Gold Mines (KCGM) Mill expansion and addition of Hemi propelling a significant further increase in Northern Star's production to ~2.5 million ounces by FY29. This reinforces Northern Star's position as the leading Australian ASX-listed gold company and a top 10 global gold major. The addition of the Hemi Project leverages Northern Star's inbuilt project capability with the project team expected to transition from the Mill Expansion to Hemi. The 27 million tonnes per annum (Mpta) KCGM Mill Expansion is the largest Australian gold project in over 10 years."
Northern Star owns and operates three key production sites, Kalgoorlie and Yandal in western Australia and Pogo in Alaska. Industrial Info is tracking 11 projects worth US$1 billion in investment as well as three key De Grey projects worth US$844 million. Subscribers to Industrial Info's Global Market Intelligence (GMI) Project Database can click here and here for the reports.
Australia holds 20.3% of the world's gold reserves and is the third-largest gold producer behind Russia and China, according to GlobalData research. In 2023, Australia produced 10.6 million ounces, equivalent to 8.2% of global gold production that year. There has been growing consolidation and takeovers in the sector over the past year, driven by record high gold prices. U.S. company Newmont Corporation (NYSE:NEM) (Denver, Colorado) bought Australia's leading player, Newcrest Mining Limited (Melbourne, Australia), last year in a US$19 billion deal. The proposed summer merger of mid-tier players Red 5 and Silver Lake Resources was completed in September, leading to the creation of a new company, Vault Minerals Limited .
Industrial Info Resources (IIR) is the leading provider of industrial market intelligence. Since 1983, IIR has provided comprehensive research, news and analysis on the industrial process, manufacturing and energy related industries. IIR's Global Market Intelligence (GMI) helps companies identify and pursue trends across multiple markets with access to real, qualified and validated plant and project opportunities. Across the world, IIR is tracking over 200,000 current and future projects worth $17.8 Trillion (USD).
Northern Star (Subiaco, Australia), the largest gold mining company, has agreed to acquire its smaller No.5-ranked rival De Grey (Perth, Australia) in an all-share transaction that will give the smaller company a 20% stake in the merged operation. The deal gives Northern Star access to De Grey's flagship Hemi project in the Pilbara region of Western Australia, classed as one of the largest undeveloped gold projects globally. It boasts mineral resources of 11.2 million ounces and an annual gold production forecast of 530,000 ounces over the first 10 years, according to estimates. The combined Northern Star Group will operate across two Tier-1 jurisdictions and four production centres, the company said, with mineral resources of 74.9 million ounces and ore reserves of 26.9 million ounces.
Northern Star Managing Director and Chief Executive Officer Stuart Tonki said: "De Grey's Hemi development project will deliver a low-cost, long-life and large-scale gold mine in the Tier-1 jurisdiction of Western Australia, enhancing the quality of Northern Star's asset portfolio to generate cash earnings. We remain committed to our profitable growth plan to 2 million ounces by FY26, with the Kalgoorlie Consolidated Gold Mines (KCGM) Mill expansion and addition of Hemi propelling a significant further increase in Northern Star's production to ~2.5 million ounces by FY29. This reinforces Northern Star's position as the leading Australian ASX-listed gold company and a top 10 global gold major. The addition of the Hemi Project leverages Northern Star's inbuilt project capability with the project team expected to transition from the Mill Expansion to Hemi. The 27 million tonnes per annum (Mpta) KCGM Mill Expansion is the largest Australian gold project in over 10 years."
Northern Star owns and operates three key production sites, Kalgoorlie and Yandal in western Australia and Pogo in Alaska. Industrial Info is tracking 11 projects worth US$1 billion in investment as well as three key De Grey projects worth US$844 million. Subscribers to Industrial Info's Global Market Intelligence (GMI) Project Database can click here and here for the reports.
Australia holds 20.3% of the world's gold reserves and is the third-largest gold producer behind Russia and China, according to GlobalData research. In 2023, Australia produced 10.6 million ounces, equivalent to 8.2% of global gold production that year. There has been growing consolidation and takeovers in the sector over the past year, driven by record high gold prices. U.S. company Newmont Corporation (NYSE:NEM) (Denver, Colorado) bought Australia's leading player, Newcrest Mining Limited (Melbourne, Australia), last year in a US$19 billion deal. The proposed summer merger of mid-tier players Red 5 and Silver Lake Resources was completed in September, leading to the creation of a new company, Vault Minerals Limited .
Industrial Info Resources (IIR) is the leading provider of industrial market intelligence. Since 1983, IIR has provided comprehensive research, news and analysis on the industrial process, manufacturing and energy related industries. IIR's Global Market Intelligence (GMI) helps companies identify and pursue trends across multiple markets with access to real, qualified and validated plant and project opportunities. Across the world, IIR is tracking over 200,000 current and future projects worth $17.8 Trillion (USD).
