Evolution completes $400m Kundana deal

Jason MennellKalgoorlie Miner
Diggers and Dealers 2019 Day 3 Evolution Mining executive chairman Jake Klein.
Camera IconDiggers and Dealers 2019 Day 3 Evolution Mining executive chairman Jake Klein. Credit: Kalgoorlie Miner, Kelsey Reid

Evolution Mining’s bid to shore up its WA goldmining operations has been cemented after it finalised the purchase of a swag of projects west of Kalgoorlie-Boulder.

The $400 million deal struck with Northern Star Resources on July 22 was completed yesterday.

The deal elevates Evolution’s Mungari operations into one of four cornerstone assets for the company boasting goldmines in NSW, Queensland and Canada.

It means the mid-tier goldminer has taken full ownership of the Kundana operations and a suite of tenements comprising the Carbine project.

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Evolution has also picked up a 51 per cent interest in the East Kundana joint venture and a 75 per cent interest in the West Kundana joint venture.

The deal provides several high-grade mill-feed options within 8km of Evolution’s Mungari operation, ultimately allowing it to lift production at the asset to 200,000oz.

The company will prioritise higher-grade feed from Kundana over lower-grade material from Mungari while it looks to expand its plant from 2Mtpa to 4.2Mtpa.

For Northern Star, the divestment enables it to sharpen its focus on its other assets and in particular its flagship Super Pit goldmine.

Evolution Mining boss Jake Klein yesterday said the consolidation of the assets was logical.

“This transaction continues Evolution’s track record of identifying and securing opportunities that are both accretive and improve the quality of the portfolio,” he said. “We now look forward to integrating the operation and delivering on the clear and significant synergies. I extend a warm welcome to our new colleagues at the Kundana and EKJV operations who join Evolution today.”

Northern Star boss Stuart Tonkin said the Kundana sale was consistent with company’s commitment to actively manage its portfolio while applying strict capital discipline.

Kundana, which produced 120,943oz last year and hosts a 2.4Moz resource, will more than double Mungari’s resource base and extend its mine life.

Evolution funded the deal through a placement and a share-purchase plan.

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