Newmont to sell Australian mine, project in $475M cash and stock deal

Mining giant Newmont Corporation (NYSE:NEM) has agreed to sell its interest in the Kalgoorlie Consolidated Gold Mine (KCGM) and the Tanami Project in Australia to Northern Star Resources Ltd (ASX:NST) for $475 million in cash and stock.

The sale is expected to close in the first half of 2023 and is subject to customary closing conditions, including regulatory approvals. The transaction will see Newmont divest its 50% interest in the KCGM joint venture, which is operated by Barrick Gold Corporation (NYSE:GOLD), and its 100% interest in the Tanami Project.

The KCGM is one of Australia's largest gold mines, with a production of approximately 500,000 ounces of gold per year. The Tanami Project is a large-scale gold project with a mineral resource of approximately 4 million ounces of gold.

Newmont said the sale is part of its strategy to focus on its core assets and to improve its financial flexibility. The company has been selling non-core assets in recent years to reduce debt and to fund its exploration and development activities.

Northern Star is a leading Australian gold producer with a portfolio of mines in Western Australia and the Northern Territory. The acquisition of the KCGM and Tanami Project will significantly increase Northern Star's gold production and reserves.

The sale of the KCGM and Tanami Project is the latest in a series of transactions in the Australian gold sector. In recent months, AngloGold Ashanti Ltd (NYSE:AU) has sold its Tropicana gold mine to Regis Resources Ltd (ASX:RRL) and Evolution Mining Ltd (ASX:EVN) has acquired the Kundana gold project from Kirkland Lake Gold Ltd (TSX:KL).

The consolidation of the Australian gold sector is expected to continue in the coming years as companies look to increase their scale and reduce costs.