PERTH (miningweekly.com) – Gold miner Newcrest on Friday announced that it would not acquire an additional 5% interest in the Havieron joint venture (JV), in Western Australia, at the $60-million price set by an independent valuer.

Instead, the company’s interest in the JV would remain at 70%.

“The option price for the 5% interest was determined by an independent valuer to be $60-million in accordance with the process set out in the JV and was based on data which was current as at 15 December 2021. Newcrest earned its 70% interest through expenditure of $65-million and the delivery of a prefeasibility study (PFS) in October 2021 and determined that the additional 5% interest for $60-million did not meet its return hurdle requirements,” the miner said in its full-year results on Friday.

JV partner Greatland Gold said it was “delighted” to retain its 30% holding in the asset, and believed the outcome delivered substantial medium- to long-term value to Greatland. 

Greatland had previously made a non-binding offer to Newcrest to acquire a 5% stake in Havieron for $85-million which, in the opinion of the Greatland directors, still presented a financially compelling outcome to Greatland shareholders, the company said.

“This outcome concludes the JV process for Newcrest’s 5% option. Havieron still has significant growth potential as the ongoing drill campaign consistently delivers excellent results that enhance the JV partners’ understanding of the size and scale of Havieron. 

“Newcrest, as a global major, and Australia’s largest gold mining company with over 35 years of experience in the Paterson and existing Telfer infrastructure, is an excellent partner to work alongside to accelerate the development of Havieron and maximise its future value.”

Newcrest has meanwhile said that the schedule for first ore from Haveiron is currently under review and will be updated with the release of the feasibility study, which is expected to be completed during the December quarter.

The Stage 1 PFS, which was completed last year, estimated a capital expenditure of A$529-million to develop the asset, which is expected to produce 160 000 oz/y of gold and 6 900 t/y of copper, over an initial mine life of nine years.