Disc: I own NST
Overview: One of the legendary Australian companies. World class gold miner. Has been hit by a 1-2 lately, with softer gold prices and the legendary Bill Beament jumping ship for Copper producer VXR. Feel like the ship is big enough to sail itself. As long as the company culture can continue it should be fine.
These guys are machines, their company report has the feel of a beehive. So many things at work concurrently; dig more, process more, explore more, spend less, buy mines, go go go! Implementation monsters.
Yandal - 2 mines, Jundee and Bronzewing, Open and Underground - 6.9Moz Resource 2.8Moz Reserve - 300koz mined at AISC $1095
Karlgoorlie - 318koz mined at AISC $1564. One mine put on "care and maintenance" due to inadequate financial returns.
KCGM (50% JV) - 111.9koz (6mo of production - unsure if this is their share or the whole lot) @AISC $1427
Pogo - 174koz @$2094
Total gold - 905koz @$1496
Forward Mines FY22 (skipping FY21 as SAR will only be half a year, just based off H1FY21 SAR+NST and doubled it.):
Yandal - 280koz @$1206
Kalgoorlie - 240koz @$2028
KCMG - 460koz @$1400
Pogo - 214koz @$1588
Carosue - 226koz @$1273
Thunderbox - 160koz @$821
Approx production - 1.58Moz @$1409
And none of these numbers factor in the capacity of NST to increase output through good management of their resources.
Gold price - took a quick look at the futures data (Jun 22): A$2300. Which is just a touch up from now. Fine for now.
A few other small points:
Pogo's AISC seems to be coming down ($2k in FY20, $1.5k in 1HFY21)
Karlgoorlie's ASIC seems to have risen in a mirror image to Pogo's. Not sure what that's about.
Big news out of NST today - The man who took Northern Star Resources from a microcap to the world’s sixth biggest gold miner has made a surprise exit to back a base metals explorer - Bill Beament will retire from the Northern Star Board, effective July 1, 2021 to take up an Executive Director role with Venturex Resources (VXR).
Wonder what implciations Bill's departure will have on NST going forward, considering he was instrumental in the phenomenal growth of NST into a behemoth that it is today.
12-Feb-2021: Implementation of Scheme
MERGER OF NORTHERN STAR AND SARACEN IMPLEMENTED
Northern Star Resources Ltd (ASX:NST) is pleased to advise that the scheme of arrangement (Scheme) in relation to the merger of Northern Star and Saracen Mineral Holdings Limited (Saracen), has today been implemented.
In accordance with the Scheme, all Saracen shares have now been transferred to Northern Star, and eligible Saracen shareholders have been issued the Scheme consideration of 0.3763 Northern Star shares for each Saracen share held on the Scheme record date. The newly issued Northern Star shares are expected to commence trading on ASX on a normal settlement basis from Monday, 15 February 2021.
In addition, Northern Star has issued the Northern Star shares otherwise payable to "Ineligible Shareholders" (as defined in the Scheme Booklet) to a nominee who has been appointed to sell those shares so that the net proceeds of sale can be distributed to applicable Saracen shareholders in accordance with the process set out in the Scheme Booklet.
Changes to Northern Star Board Composition
Northern Star has appointed the following Saracen Directors to the Northern Star Board with effect from today.
In addition, with effect from today, Peter O'Connor retires from the Northern Star Board. Mr O'Connor joined the Board as a Non-Executive Director in May 2012, when Northern Star had a share price of approximately 40 cents and annual production of approximately 72,000 ounces.
Northern Star Executive Chair Bill Beament welcomed Mr Finlayson, Mr Kiernan, Mr Richards and Ms Langer to the Northern Star Board and thanked Mr O’Çonnor for his invaluable contribution.
“Peter has been an outstanding Director,” Mr Beament said. “His wisdom, experience and commercial acumen saw him play a vital role in the creation and execution of Northern Star’s growth strategy.
“His deep understanding of financial markets and the sound advice he provided based on many years of experience made him invaluable, particularly in times of intense merger and acquisition activity.”
Mr Beament said the Board looked forward to working with the new Directors as the Company embarked on its next chapter of growth.
“We have a diverse Board, with each Director bringing particular skills and experience,” he said. “This composition will help ensure we continue growing returns for all Stakeholders using our first-class team of people, exceptional asset base, strong cashflow and robust balance sheet.”
Delisting of Saracen
An application has been made to remove Saracen from the official list of ASX, which is expected to take effect on and from Monday, 15 February 2021.
--- ends ---
(There is also an appendix which includes a summary of the material terms of Mr. Finlayson's employment agreement - the new NST MD, who came with Saracen. Click on the link at the top to read the full announcement, which includes that appendix. Bill Beament continues in his role as Executive Chairman of NST.)
[I hold NST shares.]
10-Feb-2021: On today's episode of Ausbiz's "The Call", Henry Jennings from Marcus Today (in the studio) and Andrew Wielandt from DP Wealth Advisory in Toowoomba, Queensland (via Skype) both gave NST the thumbs up (a "Buy" call), so it's been added to the Ausbiz "The Call" portfolio today. NST and SAR both reported well this morning and the merger is now complete (this week) with the two companies reporting as one company as from this coming Friday, 12-Feb-2021. As the guys say, if you like gold, this is the one to own, and I do.
Click on the link above to watch today's episode. The commentary on NST starts from the 7 minute mark.
[I hold NST shares.]
RECORD PROFITS, CASHFLOW AND INTERIM DIVIDEND
Growth strategy on track, with completion of Saracen merger paving way for increase in production to 2Mozpa, underpinned by organic sources and low capital intensity All results relate only to Northern Star; Saracen and Northern Star financial results to be combined from 12 February 2021 (merger implementation date)
--- click on the links at the top for more ---
[I hold NST shares. As stated at the top, although the merger between NST and SAR (Saracen) is now complete, these results are only for the 6 month period ending 31-Dec-2020 so do NOT include any contribution from SAR. Very impressive! NST are still the Second Largest pure-play gold producer listed on the ASX and the best run (managed) gold producer by a LONG way, and they are now also a Top-10 global gold producer as well post the merger.]
Court Approves Scheme
Saracen Mineral Holdings Limited (ASX:SAR) and Northern Star Resources Ltd (ASX:NST) are pleased to announce that the Supreme Court of Western Australia (“Court”) has today made orders approving the scheme of arrangement by which Northern Star will acquire all of the shares in Saracen (“Scheme”).
Lodgement of Court Orders and Suspension of Trading It is expected that Saracen will lodge a copy of the Court's orders with the Australian Securities and Investments Commission tomorrow, Wednesday, 3 February 2021, at which time the Scheme will become legally effective. If this occurs, Saracen's shares will be suspended from trading on the ASX at the close of trading tomorrow.
21-Jan-2021: December 2020 Quarterly Activities Report
PRODUCTION AT TOP END OF GUIDANCE, UNAUDITED NPAT OF A$100M AND DEBT CUT BY A$125M
Gold sales of 252,899oz; Standout performance at Pogo in face of COVID-19 challenges; Strong balance sheet with corporate debt cut to A$375M and A$372M in cash, bullion and investments
--- click on the link at the top for the full report ---
[I hold NST and SAR shares.]
10-Dec-2020: NST: Results of First Court Hearing
NST & SAR have released a joint announcement this morning detailing the progress of the merger, including a timeline (with dates) on page 2 (which includes the SAR special dividend). SAR shareholders will vote in mid-January and the scheme will become effective mid-February.
[I hold both NST and SAR shares.]
Unfortunately, NST haven't uploaded this announcement to their website's ASX announcements page, so we're stuck with the ASX version (with their "FOR PERSONAL USE ONLY" watermark making it hard to read). I imagine it will get uploaded some time today or tomorrow.
25-Nov-2020: Update on Proposed Merger of Equals
Saracen Mineral Holdings Limited (ASX:SAR, “Saracen”) and Northern Star Resources Ltd (ASX:NST, “Northern Star”) refer to their joint announcement dated 6 October 2020, in which Saracen and Northern Star announced execution of a binding Merger Implementation Deed (“MID”) under which Northern Star will acquire 100% of the shares in Saracen via a Saracen scheme of arrangement (“Scheme”).
Saracen and Northern Star are pleased to confirm that all Northern Star financier consents and Material Saracen Facilities and Relevant Agreements consents required under items 7 and 8 of clause 3.2 of the MID have now been obtained, and those conditions precedent are now satisfied.
The Scheme remains subject to the remaining conditions precedent in clause 3.2 of the MID, which include approval being obtained from Saracen shareholders and Court approval in relation to the Scheme.
As set out in the previous joint announcement, Saracen is expecting to circulate a scheme booklet (containing information about the Scheme and the basis for the Saracen Board's unanimous recommendation, as well as an Independent Expert's Report) to Saracen shareholders in December 2020. The Scheme is currently expected to be implemented in February 2021, subject to Saracen shareholders approving it and all other remaining conditions being satisfied.
The Scheme continues to be:
Saracen and Northern Star will continue to update Shareholders about material developments in relation to the Scheme. Saracen shareholders do not need to take any action at this time.
Authorised for release to the ASX by Bill Beament, Executive Chair (NST) and Raleigh Finlayson, Managing Director (SAR).
[I hold both NST and SAR shares.]
I note that the steep falls in the NST share price appear to have stopped with today's rise, however they still look like very attractive buying at sub-$13/share. They were trading at $16.84 only 17 days ago (their closing price on Monday 9-Nov-2020 was $16.84). At $12.91, where they are trading right now, as I type this, they are 23% below that level.
Thanks to Chagsy for bringing this excellent write-up on NST by Dumile Capital to our attention over in the "Gold as an investment" forum.
[I hold NST shares. I also hold SAR shares. SAR & NST are due to merge early in the new year (CY: 2021) after a Saracen (SAR) shareholder vote.]
This article centres around Berkshire Hathaway's recent smallish investment (for them) in Barrick Gold (NYSE:GOLD), one of the world's two largest listed gold producers (second largest gold company by market cap, and largest by EV when the article was written in August 2020). I'm 99% convinced that it was NOT Warren Buffett who made that investment decision, as I've mentioned elsewhere here previously and as this article suggests early on. WB has entrusted much of the Berkshire Hathaway (BH) everyday investment management decisions to his investment lieutenants,Todd Combs and Ted Weschler, as explained in this September 2020 article on BH's $US570 million bet on Snowflake (at IPO).
As with WB's aversion to gold, he also actively avoids early-stage technology companies, yet Berkshire is now getting in on such tech companies at IPO, and investing US$564m in Barrick Gold (20.9m x NYSE:GOLD).
Berkshire also recently (as in - in the past few years) invested in the USA's four largest airlines, something that NOBODY would have reasonably expected after reading ANY of Warren's comments on airlines, particularly that anybody who had shot the Wright brother's first successful plane flight out of the sky would have been doing future investors a huge service. Then Berkshire exited all of them (sold out of all 4 airlines) near their lows earlier this year - a move which significantly contributed to Berkshire posting a $US49.7 billion loss for the quarter ending March 31, 2020.
However, back to this Dumile Capital article on NST. Here is the best bit:
Northern Star Resources ($NST.ax), perhaps the industry’s biggest success story of the past decade, has achieved staggering returns for shareholders by executing a totally different approach. The stock’s 10-year return now stands at +15,755% (+66% annualized, not including dividends), while physical gold has risen 56% (4.5% CAGR), and Barrick has registered a cumulative loss of -42% (maybe a bit better if you add up dividends).
Northern Star has built its entire business around acquiring mispriced end-of-life assets from bloated operators like Barrick and making prudent capital investments to unleash the assets’ full potential by lowering extraction costs and extending their mine lives. The meteoric rise of NST highlights the utmost importance of management quality in a commoditized industry, as the major drivers of returns on capital are management decisions around mine transactions, operations, and gold hedging activities.
Former CEO and current Chairman Bill Beament was instrumental in formulating NST’s business model. Beament’s background as an underground mining engineer gave him a unique advantage to spot value where others couldn’t. With the support of a senior management team built with a focus on underground mining expertise, the Company has demonstrated that their ability to buy non-core “tired, unloved assets” from other companies and quickly turn them around into major performers that have a significant impact on NST shareholder value is not just a matter of getting lucky, but rather a repeatable process.
--- end of excerpt ---
I highly recommend reading the ENTIRE article - which includes Jundee as a good example of the NST model at work. As I always mention, I hold NST, and they are my favourite gold producing company, so my opinion is likely biased towards them, however you can NOT argue against their outstanding total shareholder return numbers over so many different timeframes. Bill Beament has done very well out of NST, no question, but so has every other NST shareholder who has held the stock for any decent length of time.
27-Oct-2020: September 2020 Quarterly Activities Report
To view that report without the ASX's "FOR PERSONAL USE ONLY" obscuring the text, you can download it directly from the NST website, however they haven't uploaded it to the site yet (as I type this) - when they do, you will see it appear here:
STRONG QUARTER WITH PRODUCTION AT UPPER END OF GUIDANCE
Production on track to rise 40% over next three years with costs to fall 10%
Gold sales of 227,532oz at upper end of quarterly production guidance; All-in cost of A$1,752/oz and average realised price of A$2,493/oz; Hedge book reduced to just 13% of next three years’ production
Northern Star Resources (ASX: NST) is pleased to report strong operating and financial results for the September quarter, 2020.
Gold sales of 227,532oz were comfortably in line with the Company’s published guidance for the quarter of 207,000oz – 233,000oz (22% of the annual guidance of 940,000oz – 1,060,000oz).
This strong operating performance, including all-in costs of A$1,752/oz, was complemented by an average realised price of A$2,493/oz. This resulted in robust margins which in turn led to underlying free cashflow of A$132 million after investing A$42 million in growth capital and exploration.
Northern Star finished the quarter with cash, bullion and investments of A$470 million and corporate debt of A$500 million compared with A$770 million and A$700 million respectively at June 30. During the September quarter, the Company repaid A$200 million in debt and paid fully franked dividends totalling A$200 million, or A27¢ a share. These comprised the postponed interim dividend, the final dividend and the special dividend.
The Company also continued to reduce its hedge book, which now represents just 13 per cent of forecast production for the next three years, as part of the ongoing strategy to increase its exposure to the significantly higher spot price.
Northern Star Executive Chair Bill Beament said the results highlighted the ongoing strength of the Yandal Operations, the successful ramp-up of production at Pogo and further benefits from the changes being implemented at KCGM.
“Jundee is simply one of the great gold mines of Australia, as shown by sales of more than 73,000oz in the quarter at an AISC of A$1,209/oz,” Mr Beament said.
“We are also delighted with the results at Pogo, which continued to improve on every metric as the benefits of the new bulk mining method and other changes we have introduced flow through. Costs for the quarter are 14.5 per cent lower than in FY20 and the project is generating strong free cashflow.
“Our changes with Joint Venture partner Saracen at KCGM are also paying dividends, with costs beating guidance.”
Mr Beament said the results at the Kalgoorlie Operations reflected mine sequencing which resulted in lower grades and reduced overall tonnages. Gold sales were also reduced due to a planned roaster shutdown. However, this increased the inventory of concentrate, which will be poured in the current quarter.
“Overall, we expect to increase production at the Kalgoorlie Operations each quarter this year and ultimately meet our full year guidance there.”
Northern Star’s production is set to rise by 40 per cent over the next three years to 1.25Moz and costs are forecast to fall by 10 per cent.
“We have one of the strongest growth profiles in the global gold industry and we will achieve this with one of lowest capital intensities in the global gold industry,” Mr Beament said. “This combination enables us to deliver strong growth in production and free cashflow while maintaining our superior financial returns.”
Mr Beament said Northern Star’s strong quarterly performance, combined with the excellent September quarterly results released by Saracen last week, provided further insight into the significant strengths of the proposed merged group.
“Both companies have again demonstrated the tier-1 quality of our assets,” he said. “Our combined production is growing to 2Moz a year by FY27 while most of our peers have a falling production profile. Our costs will continue to reduce and our combined scope for further organic growth in tier-1 locations is exceptional.” (*)
--- Click on the link at the top (one of them) for the full report ---
[I hold NST and SAR shares.]
The ASX's new website (launched today) had a few hiccups, and one of them is the way they're adding their "FOR PERSONAL USE ONLY" watermark to the left edge of all ASX announcements by everybody. They are covering up text and making announcements hard to read, and when the announcement is a slideshow like this one, they don't even fit the watermark up the left hand edge - it just says "IAL USE ONLY" on each page instead. Quite sub-par really.
Thankfully, the better companies also allow you to download these announcements directly from their own website. NST are one of these better companies, and the announcement (their joint NST+SAR Diggers and Dealers Company Presentation) - without the annoying watermark - can be viewed by clicking on the following link:
Because the two companies are merging, and the merged entity will be called "Northern Star Resources" and have the NST ticker code, I am not going to post straws under SAR (Saracen Mineral Holdings) as well as NST, just under NST from now on.
[NST and SAR are among the gold producers that I hold shares in. NST has been my favourite ASX-listed gold producer for the past five years - and I've done VERY well out of them. This merger will only make them even bigger, even more relevant, and better. They are going to be on a lot more overseas investors' radars now as well, which isn't a bad thing, because their fundamentals, when compared to other large global gold miners, look excellent. Bill Beament has always run NST as a business first, and a miner second. Sustainable and growing profitability and way above average total shareholder returns have been a feature of NST for the past 5 or 6 years. NST compares very well with the vast majority of other ASX-listed companies, not just gold producers. Northern Star has been a consistent outperformer.]
06-Oct-2020: Presentation - SAR and NST agree to Merger of Equals
The scale and liquidity to attract both gold and generalist investors.
A compelling combination - Takeaways
A unique opportunity exclusively available for both companies to unlock significant value, and build a major global gold producer with an exceptional high-margin growth profile.
Benefits to Northern Star shareholders
Benefits to Saracen shareholders
Benefits to both sets of shareholders
--- click on links above for more --- [and there is a lot more]
[I hold both NST & SAR shares, and I flagged this merger as a possibility last year and again earlier this year after the two companies became JV partners in KCGM - i.e. the Kalgoorlie Super Pit. It just makes sense. Very positive IMO.]
13-August-2020: Resources & Reserves, and Guidance Update (ex-KCGM)
PRODUCTION SET TO INCREASE 30% OVER NEXT TWO YEARS AND COSTS TO FALL 10%
FY21 production guidance (ex-KCGM) is 720koz-820koz; Production (ex-KCGM) is forecast to rise to ~900koz in FY22 and ~1Moz in FY23, driving down AISC by 10%; Resources increase by 3.2Moz, underwriting longer mine lives and increased cashflow.
Resources at June 30, 2020
Reserves at June 30, 2020
--- click on the link at the top for the full announcement ---
[I hold NST - they are my #1 Australian Gold Producer pick, and have been for the past decade.]
8-July-2020: June Quarter Trading Update
This time last year, the massive Kalgoorlie Super Pit, which used to be the largest OP (open pit) gold mine in Australia (recently overtaken by Newmont's Boddington Gold Mine) was owned by the two largest gold mining companies in the world - Barrick and Newmont - via their JV company known as Kalgoorlie Consolidated Gold Mines - or KCGM. However those two giants of the industry have now sold their respective shares of KCGM to Northern Star (NST) and Saracen (SAR), Australia's 2nd and 4th largest gold producers (70%+ in gold). Both companies have updated the market this morning. I have already posted a straw about Saracen's update, and briefly mentioned the further positive gold price movement overnight.
This straw is about NST's update, which the market seems to be more excited about so far, mainly because Bill Beament seemed very cautious and worried about the impacts of COVID-19 when he last provided a comprehensive update (and deferred their interim dividend payment). This wasn't as obvious in their announcement at the time, but was very clear during the associated conference call with analysts and shareholders which I (as an NST shareholder) participated in.
My view at the time was that Bill was being very conservative and was positioning the company to be able to get through COVID was as little damage as possible, and that his position and attitude was an excellent response to a very fluid and uncertain situation. NST got sold down to close to $10/share (during that first week of April), almost re-testing their March low. I took the opportunity at that time to top up my NST positions (I hold them in all of my portfolios, including my super).
Today we will likely see a decent relief rally in NST, because things weren't nearly as bad as Bill thought they might be, and he's brought forward that interim dividend payment now to next week. I would expect NST to finish the day somewhere between $14.50 and $15. I love it when a plan comes together.
NST: June Quarter Trading Update
UNDERLYING FREE CASHFLOW OF A$217.9M FROM SALE OF 262,717 OUNCES
Postponed FY20 interim dividend of A7.5¢ to be paid on July 16, 2020
Northern Star Resources (ASX: NST) advises that its cash, bullion and investments rose by 40% to A$769.5 million at June 30, 2020, up from A$551.4 million at March 31, 2020.
As a result, the Company’s balance sheet was net cash positive at June 30, 2020, with corporate bank debt of A$700 million.
Northern Star generated underlying free cashflow of A$217.9 million in the June quarter from the sale of 262,717oz. This took total sales for the 2020 financial year to 900,388oz while gold produced totalled 905,177oz. This was ~1.6% below the lower end of the FY20 guidance, which was withdrawn due to uncertainties stemming from COVID-19 (see ASX release dated March 26, 2020).
In light of this solid result, Northern Star will pay its FY20 fully-franked interim dividend of A7.5¢ a share on July 16. Payment of this dividend, which totals A$55 million, was postponed when the Company withdrew its guidance.
The Company expects to resume dividend payments in the ordinary course of business.
As part of its COVID-19 measures, Northern Star also drew down an additional A$200 million in debt in the March quarter. The Company has repaid that A$200 million on July 6, reducing its corporate bank debt to A$500 million.
In the June quarter, Northern Star reduced its hedge book to 536,426oz at A$2,085/oz (170,080oz, or 34% of ounces sold, in the June half came from hedged positions) as part of the Company’s strategy to increase its exposure to the spot price. Pushed-out hedged positions are being brought back and deliveries will continue to be accelerated in FY21. The Company has one of the smallest hedge books as a percentage of annualised production in the Australian gold industry, with just 15% of the next three years production committed.
Northern Star Executive Chair Bill Beament said the Company’s staff and business partners had done an outstanding job in very difficult circumstances. This enabled Northern Star to maintain the full employment of the Company’s workforce and business continuity for all stakeholders.
“The health and safety of our people and the communities in which we operate is always our first objective and the measures we adopted in response to COVID-19 reflected that,” Mr Beament said.
“As we foreshadowed at the time, these measures incurred additional costs, reduced productivities and restricted production.
“We also adopted a prudent approach to managing our balance sheet, as reflected in the decision to postpone the interim dividend and drawdown the additional debt.”
Mr Beament said that as well as protecting its people, these measures were aimed at maximising the Company’s ability to continue operating at all its sites throughout the pandemic.
“To generate quarterly free cashflow of A$217.9 million in these circumstances is an outstanding result which reflects the performance of our staff and business partners, our success in being able to operate continuously throughout the pandemic and the underlying strength of our assets,” he said.
“The results at our Pogo mine in Alaska were particularly pleasing given the challenging circumstances emanating from COVID-19 where we effectively managed safe operations with 36 confirmed cases through the quarter.
“Despite the considerable impacts of COVID-19 at Pogo, the underlying trend of rising production and productivity continued. This further demonstrates the huge potential of this asset in more conventional circumstances.
“The teams at our Jundee and Kalgoorlie Operations excelled and we made strong progress towards our goal of unlocking the significant upside at KCGM.”
--- click on the link at the top of this straw for the rest of this announcement ---
[I hold NST shares]
22-June-2020: Northern Star Divests Ashburton Project
Northern Star Resources Limited (ASX: NST) advises that it has agreed to divest the Mt Olympus Project comprising most of the Ashburton Project in Western Australia to Kalamazoo Resources Limited (ASX: KZR) for a deferred contingent cash consideration of A$17.5 million.
The deferred cash consideration is as follows:
Northern Star Executive Chair Bill Beament said: “The Ashburton Project no longer fits in Northern Star’s portfolio but still has strong potential on both the exploration and production fronts. The royalty structure also enables Northern Star to retain an exposure to the project.”
Completion of the divestment is conditional on Ministerial approval and third party rights being observed.
--- ends ---
Disclosure: I hold NST shares, but not KZR shares.
26-Mar-2020: COVID-19, Guidance and Dividend Update
Northern Star, Australia's second largest listed gold producer, has withdrawn their previous production guidance admitting there have been disruptions to production at some of their mines and that there could well be further discruptions. They have also deferred payment of their interim dividend until October. That's something I've seen a number of companies do over recent days. In this case however, it would appear that this was NOT priced in already, as NST are off over 11% so far today, while most of their peers (the larger ASX-listed gold miners) are up or down around 1% to 2% today.
25-Sep-2018: Article in MiningNews.Net - see here - "Upside at Pogo Immense: Beament"
More of the same. "We're not doing anything different here guys," said Bill Beament, pointing at Northern Star's track record of deals - 10 in eight years which created A$5.3 billion of value in the process.
Beament said Pogo's status as a tier one underground operation in a tier one jurisdiction fit within Northern Star's DNA.
"No offence, but you're not going to see Northern Star rush off to places like Africa," he said.
"We like Australia, the US and Canada.
"[Pogo] gives us great exposure to a prolific mineral belt.
"There are many global majors fighting to get into this jurisdiction as we speak."
What excites Northern Star is the potential at Pogo - it was once a 300,000oz per annum producer and could well be again in the not-too-distant future.
The company sees similarities between Pogo and its world-class Jundee mine.
"The reserve cut-off grade is 8.3 grams per tonne gold, which is nearly four times the cut-off grade of Jundee," Beament said.
Jundee's break-even cut-off grade is 6.5gpt gold, which Beament said highlighted the huge potential at Pogo.
Current owner Sumitomo had set an US$18 million exploration budget for this calendar year.
The results are due shortly and Northern Star will announce an updated JORC-compliant resource for Pogo when it takes ownership next month.
Beament pointed out Pogo had one tenth of the drilling completed at Jundee.
"This is a spectacular orebody," he said.
Unlike some of the company's other assets, Beament said Pogo wasn't a requiring a full renovation.
"This ain't broken," he said.
"We don't have to invest nearly as much as we've had to with our other assets."
Northern Star already has 16 members of its team onsite ahead of the acquisition close next month.
"It's called planning and preparation, and we're well advanced," Beament said.
I hold NST shares.
03-Feb-2020: Northern Star's SPP shares are being allocated today. They haven't officially released an announcement regarding how they have scaled back applications, they've just said that the SPP was seriously oversubscribed. I've just got off the phone with their SPP info line however and one of my accounts - that had just 50 NST shares in it (a marketable parcel, but not much more than that) received only 7 (yep, seven) new NST shares in this SPP. Apparently they've gone with a pro-rata scale back to avoid unnecessary dilution with those who have larger shareholdings. In other words, the smaller your NST holding was on the record date (December 16, 2019), the smaller your allocation will be. Luckilly I have a larger holding in another account. Unluckilly, that other account is an industry super fund and they don't allow you to participate in SPPs - they only allow you to participate in rights issues - when the rights can be traded on the ASX. I'm a little bit pissed off - $9 SPP price, and NST trading at around $13 now, but they are free to scale their SPP back any way they want to, and they're clearly looking after those with decent shareholdings before those with much smaller ones here. I still have reasonable exposure to the company via my CBUS SMSF, but I would still have liked to have received more than seven shares in my other (main trading) account!!
18 June 2019: Company Presentation - London Roadshow
"An Australian gold miner - for global investors" - London Roadshow - June 2019
24-Apr-19: March 2019 Quarterly Activities Report - which is subtitled, "Pogo hits inflexion point, paving way for record fourth quarter."
Disclosure: I hold NST shares.
16-Oct-2018: Northern Star has released this announcement today titled, "Pogo Resource Update" in which they have increased the Pogo Resource estimate by 24% (or around 0.8 million ounces of gold).
Highlights of the announcement:
NST also released another Investor Presentation on October 3rd - see here
NST also released a Pogo Site Visit Presentation Pack on September 28th (the site visit by analysts was on the 27th September) - see here
They also announced on October 1 that they had completed the Pogo acquisition - see here
Disclosure: I hold NST shares.