A spectacular blast rocked one of Australia’s biggest gold mines as the co-owners of Kalgoorlie-Boulder’s Super Pit try to execute a seamless transition amid a $16 billion merger.
- The Super Pit has produced more than 21m ounces of gold since open pit mining began in 1989
- At nearly 3.5 kilometres long, 1.5km wide and 600 metres deep, the Super Pit is so big it is visible from space
- The mine’s co-owners, Northern Star Resources and Saracen Mineral Holdings, are set to complete a $16b merger next month
The unusually large explosion at the Super Pit moved almost one million tonnes of ore in 25 seconds and was watched from a public lookout by hundreds of locals.
It required the loading of more than 200 tonnes of explosives into 1,780 holes, which were drilled to a depth of 11 metres.
The blast was part of a large cutback of the open pit mine’s eastern wall, which is being remediated following severe rock falls that occurred in May 2018.
Work to strip the wall back by about 100m began last year and is expected to take at least three years.
Today’s blast followed a vote last week that saw shareholders approve a $16 billion merger of the Super Pit’s co-owners, Northern Star Resources and Saracen Mineral Holdings.
Both companies released their quarterly results to the ASX today.
Despite still needing West Australian Supreme Court approval on February 2 to finalise the merger, senior management said the integration was on track.
Companies working through transition
Saracen’s managing director Raleigh Finlayson will take the reins of the merged Northern Star.
“There is an overwhelming sense of excitement,” he told analysts and media.
“The growth attributes of both companies are very aligned, so if you’re an employee it is pretty exciting what we’re going to be doing into the future.
The merger creates the world’s eighth-biggest gold producer – and Australia’s second biggest, behind Newcrest Mining – and will see production increase towards 2m ounces a year by 2027.
It also consolidates Kalgoorlie-Boulder’s famous Golden Mile – once considered the richest square mile on Earth – under a single owner for the first time in its 128-year history.
“We’re well advanced on putting the teams together,” Northern Star executive chairman Bill Beament said.
“Yes, we had to be respectful of a vote, but the initial feedback on the merger was very positive, so we didn’t sit idle as a combined management team.
“Raleigh put his name on an office next to mine pretty quickly and the team have been working hand and glove consistently, because we don’t want to lose time on the opportunities we can create as a merged company.”
‘One of the great opportunities’
The Super Pit produced 59,446 ounces of gold in the December quarter, boosting the overall production for 2020 to 226,596 ounces.
The amount of material being moved was up 22 per cent as mining continued to ramp up, with a new $20m shovel now onsite and a new truck fleet due to arrive in May.
Four areas – Golden Pike, Oroya Brownhill, Fimiston South and Morrison – are being mined simultaneously within the Super Pit.
Mining rates are moving around 60m tonnes per annum and the plan is to hit a target of 75-80m tonnes.
“We are delivering on every element of the scrip we gave to the market when we unveiled our merger last October,” Mr Beament said.
“In fact, I’d go as far to say that it is one of the greatest opportunities currently on offer in our industry globally.
“We are creating a gold mining company that will be growing at a time when most of our peers are staying still or shrinking.”
Northern Star chief executive Stuart Tonkin, who is set to take over as managing director of the merged company within 18 months, said he expected the integration to go smoothly.
“A lot of work was done prior to the announcement of the merger so it could be proved up and both teams could sit together to see what it would look like,” he said.