As part of its continued portfolio optimization actions, gold
) has cut a deal to divest its Jundee underground gold mine in
Australia to Northern Star Resources for roughly $91 million,
consisting of around $77 million of cash and $14 million for
The Jundee gold mine in Western Australia began production in 1995
from a complex of open pit mines. It started operation as an
underground mine in 1997. The mine produced 279,000 ounces of gold
Under the binding agreement, Northern Star is buying all of
Jundee's assets and liabilities including all environmental and
employee obligations. The closure of the transaction, which is
conditional upon Northern Star securing financing and subject to a
third party right of refusal, is expected in early July 2014.
Following the sale, all existing fixed plant and onsite equipment
owned by Newmont will be transferred to Northern Star. Moreover,
most of Jundee's non-contract staffs will be offered continuing
The divestment underscores Newmont's strategy to focus more on its
core assets that have longer life and lower cost. As part of this
strategy, the company has sold its Midas mine in Nevada to Klondex
Mines Ltd. It has also sold its equity interest in Paladin Energy
Gold miners are shedding non-core assets to optimize their
portfolio as they grapple with lower
and high mining costs. Another gold major
) also sold its Kanowna and Plutonic gold mines in Australia to
Northern Star as part of its aggressive portfolio optimization
Newmont's profit from continuing operations (as reported) slid
roughly 63% year over year in first-quarter 2014 as it saw lower
pricing for gold and copper in the quarter. Nevertheless, the
company witnessed a rise in gold and copper productions in the
Newmont is a Zacks Rank #3 (Hold) stock.
Better-ranked gold stocks include
Agnico Eagle Mines Ltd.
AngloGold Ashanti Ltd.
) with both retaining a Zacks Rank #1 (Strong Buy).
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BARRICK GOLD CP (ABX): Free Stock Analysis
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