Australian gold junior Beadell Resources has had to cancel its acquisition of the Cracow mine, in Queensland, from Newcrest Mining, because current tough market conditions prevented its equity raising.

The company announced on Friday that Newcrest would now refund its A$2-million deposit plus interest.

Beadell said last year that it would buy Australia’s biggest gold producer’s 70% interest in the mine for A$200-million.

Meanwhile, Newcrest revealed on Thursday that it had closed out its hedge book, after having bought back four-million ounces of gold, at an average price of A$868/oz, which it said was A$70/oz lower than the metal’s average price over the buying period.

The move cost the miner A$1,67-billion, which was more than what it had initially expected.

Cracow produced more than 100 000 oz/y of gold.

As part of the original sale agreement, Newcrest now had the option to buy the 30% of the mine that it did not already own from Lion Selection.

It did not say whether it would exercise this right.

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