PERTH (miningweekly.com) – Gold miners Northern Star and Saracen Mineral Holdings have both adjusted their gold production targets as new production targets were set at the Kalgoorlie Super Pit joint venture (JV).

A strategic review by the JV partners established the operation as a long-life asset with a growing production profile and significant exploration upside, based on a Joint Ore Reserves Committee-compliant reserve of 9.7-million ounces, after the depletion of 293 000 oz, and a resource of 19-million ounces.

The JV partners said in a statement on Tuesday that the reserve provided mine life visibility of 15 years, with significant exploration upside.

The review also outlined the future production profile for the asset, with the mine expected to produce between 440 000 oz and 480 000 oz in 2021, at an all-in sustaining cost of between A$1 470/oz and A$1 570/oz.

Production from the Super Pit is expected to increase to more than 500 000 oz/y from 2024, as the Fimiston South orebody becomes the dominant ore source and access to the high-grade Golden Pike North orebody is restored. Gold production is expected to steadily climb to more than 675 000 oz/y from 2028.

The JV partners have approved a growth capital budget of A$198-million for the 2021 financial year, and an exploration budget of A$12-million, with a further A$240-million to A$270-million to be spent at the project in 2022.

With the increased production expected from the Super Pit operation, Northern Star is targeting a gold production of between 940 000 oz and 1.06-million ounces for the 2021 financial year, with production forecast to increase to 1.15-million ounces by 2022 and to 1.25-million ounces in 2023.

The miner on Tuesday told shareholders that production would increase further to 1.3-million ounces by 2027.

Executive chairperson Bill Beament said that the Super Pit review had highlighted the world-class status of the project, and the extent to which it would further drive growth in the company’s cash flow.

“The review shows that the outlook for the KCGM is excellent on every level. The project is set to generate strong production growth underpinned by an extensive inventory in a tier-1 location.

“The updated inventory shows KCGM has mine life visibility of 15 years as well as substantial scope for further growth through exploration in and around the Pit and underground.”

He said that the operation would play a key role in driving Northern Star’s annual production rate to 1.25-million ounces and beyond over the next few years, with costs falling in the process.

Meanwhile, Northern Star on Tuesday told its shareholders that its Pogo operation, in Alaska, is expected to contribute some 180 000 oz to 220 000 oz in production during the 2021 financial year, with the miner setting aside A$50-million for capital expenditure at the Alaskan project in 2021 and 2022 combined, to improve processing and support infrastructure in order to lift capacity to 1.3-million tonnes a year.

Meanwhile, JV partner Saracen has set its own production target of 600 000 oz to 640 000 oz for 2021, with the company anticipating production to grow to about 700 000 oz/y in 2024 and to about 800 000 oz/y in 2027.

MD Raleigh Finlayson said the company was on track to continue its record of growing its production and expanding inventory.

“Saracen’s strategy of making opportunistic acquisitions and then unlocking their full value through exploration and development has created substantial value for shareholders for many years.

“This same strategy is now underpinning a new era of growth for the company as shown by the impressive growth in the resource and reserves, and the forecast production at our recently acquired KCGM project

“As in the past, our next round of substantial growth will come totally from within Western Australia, ensuring our future-proofing strategy continues to benefit from the certainty which comes from operating solely in a tier-1 location.”

Saracen has set a growth capital guidance of A$429-million for 2021, marking it as the peak year for investing in growth, with the miner also setting an exploration budget of A$55-million.