Northern Star Resources (ASX: NST) has released its December 2022 Quarter production report.
HIGHLIGHTS
Environment, Social and Safety (ESS)
- LTIFR at 0.9 per million man hours
- Jundee renewable energy project preliminary works agreement established with Zenith Pacific
Production
- Gold sold totalled 404koz at an AISC of A$1,746/oz (US$1,147/oz) and AIC of A$2,243/oz
- December quarter performance by production centre:
- Kalgoorlie: 210,361oz gold sold at an AISC of A$1,738/oz
- Yandal: 128,470oz gold sold at an AISC of A$1,591/oz
- Pogo: 65,456oz gold sold at an AISC of US$1,362/oz
- Group operations delivered in line with expectations; significant cost improvement (AISC and AIC) at key growth projects, Pogo and Thunderbox
- KCGM underground on track to deliver 2Mtpa in FY23 as part of long-term growth push; new open pit fleet delivered record material movements as part of plan to unlock reserves
Discovery and Growth
- Advancing five-year profitable growth pathway:
- Kalgoorlie: KCGM material movements at an annualised 84Mtpa (vs target of 80-100Mtpa until FY26)
- Yandal: Thunderbox mill expansion well positioned to operate at 6Mtpa nameplate capacity in 2H23
- Pogo: Maintained 1.3Mtpa throughput; focus on optimisation initiatives
- During the quarter, Northern Star spent A$179 million on growth capital and A$32 million on exploration
Financial
- Strong balance sheet with net cash of A$145 million at December 31; cash and bullion of A$495 million
- 1H23e Cash Earnings of A$460-475 million (1H22a: A$430 million)
- All three production centres generated positive net mine cash flow
Corporate
- A$300 million on-market share buy-back program 42% complete
Outlook
- Maintain FY23 guidance of 1,560-1,680koz gold sold at an AISC of A$1,630-1,690/oz (2H weighted)
- Maintain FY23 growth capital budget of A$650 million; exploration budget of A$125 million.
Commenting on the December quarter performance, Northern Star Managing Director Stuart Tonkin said:
“The December quarter has demonstrated our capability to operate at 1.6Mozpa, in line with our five-year growth strategy.
“All three production centres achieved positive net mine cash flow after funding their capital requirements.
“We remain on track to deliver our FY23 guidance.
“We are making exceptional progress at key growth projects that will drive costs lower and, in turn, build cash to maintain a strong financial position.
“Our largest asset, KCGM, remains in very good shape while the expected lift in group production in the second half will be driven by the recently expanded mill at Thunderbox, part of the Yandal hub, and further improvement at Pogo.
“In parallel, we are building good momentum in the journey to cut our carbon emissions by 35% by 2030.
“We have entered the 2023 calendar year with a stable and united team and a strong safety culture.
“I’m proud of our people and their commitment to safely and sustainably execute our value-creation strategy.
“This strategy is built on world-class gold assets in Western Australia and Alaska that provide us with superior organic growth optionality.
“This is complemented by our ongoing exploration success, which enables the low-cost resource inventory build needed for long-term success.”
