PERTH (miningweekly.com) – Gold miner Northern Star on Tuesday reported that it could proceed with the acquisition of the Jundee gold project, in Western Australia, after a third party waived its right of first refusal to buy the mine.

In return for waiving the right, Northern Star would issue the third party A$10-million worth of shares on the completion of the asset sale agreement with gold miner Newmont Mining. The shares would be escrowed for six months.

Northern Star announced in May that it would become the second-largest gold miner on the ASX, with the $91-million acquisition of the Jundee gold mine from Newmont.

The offer consisted of a $77-million cash component and a A$14-million payment for working capital.

Northern Star MD Bill Beament said the agreement with the third party eliminated one of the remaining conditions precedent for Northern Star to complete the acquisition.

The company expected to satisfy the financing condition by June 26.

“We are delighted with the terms on which we have acquired Jundee. The project will contribute around 200 000 oz/y to our total output, and help ensure we meet our targeted all-in sustaining cost of less than A$1 050/oz.”

Meanwhile, the Australian gold miner on Tuesday revealed that it had produced 41 668 oz of gold during the month of May, as its recently acquired Plutonic, Kanowna Belle and Kundana acquisitions were bedded down.

The production figures were well ahead of the company’s targets, Beament said, under which Northern Star aimed to produce at a combined yearly rate of at least 350 000 oz from its four operations, which include the Paulsens mine.

Post the settlement of the Jundee acquisition, Northern Star would produce at a rate of about 550 000 oz/y.

Beament pointed out that during May, gold production was 32% higher than the levels achieved in April, highlighting the impact of the company’s efficiency measures at the new mines.

“We set aggressive targets at the time of the acquisitions and these results demonstrate clearly that we are not only meeting them, we are exceeding them. Not only are we experiencing no difficulties in bedding down the assets, but we are seeing the benefit of introducing our productivity to drive them.”