Saracen will purchase Barrick Gold’s stake in Super Pit gold mine in Australia

November 18, 2019

Barrick Gold Corp. will sell its 50 percent stake in the Kalgoorlie Consolidated Gold Mines (KCGM) in Western Australia to Saracen Mineral Holdings in Western Australia to Saracen Mineral Holdings for $750 million. Newmont Goldcorp will retain its 50 percent stake in the project.

Saracen already holds two gold operations in the Kalgoorlie region, namely, the Carosue Dam and the Thunderbox mine sites. With this deal the company will also assume 50 percent of the Super Pit Mine.

The Super Pit is one of Australia’s largest gold mines with an average production of 660,000 oz/year at an all-in sustaining cost of about A$1,100 per ounce, according to Saracen.

The divestment is part of Barrick’s, the world’s second-largest gold producer, drive to dispose of noncore assets, Reuters reported.

“While this iconic gold mine has been a valuable contributor to Barrick over the years, the asset does not fit with our strategy of operating mines that we own,” Barrick said in a statement.

Saracen will fund the acquisition partially through a A$796 million (US$545.66 million) capital raising and the balance through a loan of A$450 million.

“We congratulate Saracen on its agreement to purchase Barrick’s stake in KCGM and we look forward to partnering with them to continue delivering value at this world-class asset, safely and efficiently,” said Tom Palmer, president and chief executive officer of Newmont Goldcorp. “KCGM and the Golden Mile offer ongoing growth and value generating opportunities in Australia, which remains a core operating region for Newmont.”

Located in Kalgoorlie-Boulder in Western Australia, KCGM directly employs approximately 1,250 people and produced 636,000 ounces of gold in 2018. Operations began at KCGM in 1989 and the mine has produced 21 million ounces of gold over the last three decades.

The deal is expected to be completed in the December quarter and is subject to regulatory approvals from the West Australian government.

 

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