PERTH (miningweekly.com) – Gold miner Northern Star has struck a A$67-million deal with fellow listed Strickland Resources to acquire that company’s interest in the Millrose gold project, in Western Australia.

The total consideration payable will include a A$41-million cash component and 1.5-million shares in Northern Star, with a A$2-million deposit immediately payable to Strickland.

The Millrose gold project has a published mineral resource of 346 000 oz of gold at a grade of 1.8 g/t gold, and offers significant geological upside. The project is 40 km east of Northern Star’s Jundee operation, and is expected to be a supplementary feed source for the Jundee mill in the medium term, complementing the project’s underground base load.

“The acquisition of the Millrose gold project presents a very compelling development opportunity that is accretive to the Jundee life-of-asset plan as it should deliver us a sizeable, low-cost, high-grade supplementary resource feed,” said Northern Star MD Stuart Tonkin.

“This bolt-on acquisition, which also comes with significant brownfield exploration upside, will provide us with further confidence to plan organic and profitable growth for Jundee, which already is the lowest cost asset in our tier-one portfolio.”

Strickland CEO Andrew Bray told shareholders that the sale would be transformative for the company.

“The Millrose project was purchased for A$10-million in mid-2021. After a highly successful 11-month drilling campaign throughout 2022, costing approximately A$16-million, we are now selling the project for approximately A$61-million, generating an approximate A$35-million profit for the company.

“We are also exceedingly pleased that we have been able to deliver such a strong outcome for shareholders given the ongoing difficult market conditions for junior exploration companies. This transaction leaves Strickland in the highly envious position of having one of the strongest balance sheets in the junior exploration space.

“We are confident of advancing and upgrading a number of additional gold prospects along strike to a standard similar to Millrose. Horse Well, Cowza and several other prospects will be the immediate focus of upcoming gold exploration programmes. The company will also be able to expedite some exploration programmes around the highly encouraging Iroquois base metal discovery,” he added.

Meanwhile, Northern Star on Monday also announced a long-term power supply agreement with Zenith Energy for the supply of electricity to the Jundee operations, incorporating 40 MW of wind and solar generation.

Jundee will have wind, solar and battery installed and integrated into the existing gas power station network. The renewable generation being added includes 24 MW of wind, 16.9 MWp of solar, and 12 MW/13.4MWh of battery energy storage. This will provide 56% of the mine site’s power based on current modelling.

Northern Star has committed to reducing its carbon footprint by 35% by 2030. The Jundee operation was identified as the next operation in Northern Star’s asset portfolio to target material reductions in carbon emissions following the successful introduction of solar at the Carosue Dam operations.