Northern Star agrees to buy Newmont power business

published by

Global Mining Review,

Northern Star Resources Ltd has agreed to acquire the energy business of Newmont Corporation from its Australian subsidiary, Newmont Australia, for US$95 million.

As part of Northern Star’s purchase of 50% of Kalgoorlie Consolidated Gold Mines Pty Ltd (KCGM) and associated assets, Northern Star has paid US$25 million for an option to purchase Newmont’s energy business .

Northern Star has now entered into a binding sale agreement with Newmont Australia to acquire all shares of GMK Investments Pty Ltd, which owns a 100% interest in Newmont Power Pty Ltd and NP Kalgoorlie Pty Ltd. NP Kalgoorlie owns 50% of Goldfields Power Pty Ltd, the owner of the Parkeston Power Station.

The option cost will be deducted from the final purchase price, leaving Northern Star to pay the remaining US$70 million upon completion, which is expected to take place in December 2021.

The 110 MW Parkeston Generating Station and associated infrastructure primarily supplies power to KCGM. Parkeston also supplies electricity to the Kalgoorlie area through its connection to the South West Interconnected System. The factory has a history of continuous reliable production.

This purchase provides Northern Star with significant synergies and value, including:

  • Infrastructure and power security to meet KCGM requirements.
  • Reduction of energy costs at KCGM.
  • Other options for Northern Star to implement renewable energy.

Northern Star managing director Stuart Tonkin said the acquisition gave the company greater control over its power supply in Kalgoorlie:

“The purchase means that our Kalgoorlie power supply will now be part of our studies of how to meet our commitment to becoming carbon neutral.”

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