PRECIOUS METALS

Northern Star finalises Pogo buy

Northern Star Resources has completed the US$260 million acquisition of the Pogo gold mine in Alaska.

 Pogo adds 250,000-260,000oz to Northern Star's FY19 guidance

Pogo adds 250,000-260,000oz to Northern Star's FY19 guidance

The acquisition from Sumitomo Metal Mining Co and Sumitomo Corporation was finalised on Friday.

Northern Star executive chairman Bill Beament praised Sumitomo for its professionalism throughout the process.

"On behalf of Northern Star, I would like to thank Sumitomo for their assistance and the outstanding condition in which they have left the Pogo mine," he said.

The buy was funded via Northern Star's cash balance and a A$175 million raising priced at $6.70.

Shares reached as high as $9.25 last month and rose by 1.1% to $8.395 this morning.

Northern Star will receive the full financial benefit of Pogo from July 1 and around 16 of the company's staff were onsite planning for the integration ahead of the close of the transaction.

The company's FY19 guidance now stands at 850,000-900,000 ounces of gold at an all-in sustaining cost of $1,050-1,150 an ounce (US$787-862/oz).

Northern Star has started the process of converting the 4.1 million ounce Pogo resource to JORC status.

The company will provide more details about Pogo in its upcoming September quarterly report to be released later this month.

Coming up: Kristie Batten's full report from a site visit to Pogo.

 

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