Newmont Mining Corporation (NYSE: NEM) (“Newmont” or “the Company”) announced it has entered into a binding agreement with Northern Star Resources Limited (“Northern Star”) to sell the Jundee underground gold mine in Australia for total proceeds of approximately US$91 million, comprised of cash at closing of approximately US$77 million plus a further payment of approximately US$14 million for working capital. Northern Star is acquiring all of Jundee’s assets and liabilities including all environmental and employee obligations.
“We are pleased to announce our agreement with Northern Star. It demonstrates our continuing efforts to optimize our portfolio and increase shareholder value by focusing on lower cost, longer life operations,” said Randy Engel, Newmont’s Executive Vice President for Strategic Development. “The agreement with Northern Star builds on Newmont’s other, non-core asset sales, including its stake in Canadian Oil Sands, the Midas underground mine in Nevada and the Company’s equity interest in Paladin Energy Limited. Combined with the pending Jundee transaction, cash proceeds received from these sales total approximately US$800 million.”
The sale is expected to close in early July. Closure is contingent upon Northern Star securing financing and subject to a third party right of refusal.
The Jundee gold mine is located 520 kilometers north of Kalgoorlie in Western Australia. Production began in 1995 from a complex of open pit mines that have now ceased operation. Underground mining began in 1997 and continues today. All existing fixed plant and onsite equipment owned by Newmont will be transferred to Northern Star and the majority of Jundee’s non-contract staff will be offered continuing employment. Jundee produced 279,000 ounces of gold in 2013.
Founded in 1921 and publicly traded since 1925, Newmont is a leading producer of gold and copper. Headquartered in Colorado, the Company has approximately 30,000 employees and contractors, with the majority working at managed operations in the United States, Australia, New Zealand, Peru, Indonesia and Ghana. Newmont is the only gold company listed in the S&P 500 index and in 2007 became the first gold company selected to be part of the Dow Jones Sustainability World Index. Newmont is an industry leader in value creation, supported by its leading technical, environmental, and health and safety performance.