Saracen CFO tips major growth after Super Pit buy

Saracen Mineral Holdings could more than double its annual production within four years courtesy of its Super Pit acquisition, according to chief financial officer Morgan Ball
22nd November 2019
Resources Rising Stars

Saracen Mineral Holdings could more than double its annual production within four years courtesy of its Super Pit acquisition, according to chief financial officer Morgan Ball (reports The West Australian).

Speaking at the company’s annual general meeting in Perth yesterday, Mr Ball told shareholders the upside potential of the Super Pit along with organic growth at Saracen’s existing WA assets could deliver annual production of 800,000oz within four to five years.

He was speaking after the company this week made a $US750 million ($1.1 billion) winning bid to claim a 50 per cent stake in the famous Kalgoorlie mine from Canada’s Barrick.

Mr Ball noted the Super Pit had been a “set the budget, deliver the ounces-type operation” in recent years.

“Barrick had the ‘for sale’ sign out for a couple of years now and probably haven’t been as keen to invest their capital in this operation compared to some of their other ones,” he said.

“I think it’s fair to say (joint venture partner) Newmont are very excited to have a company like Saracen on board now to start looking at some of the opportunities we can unlock with this asset.”

Mr Ball played down the 2018 pit-wall slip that had seen production drop from 730,000oz in 2018 to 490,000ozpa last financial year and costs rise from $1023/oz to $1470/oz.

“The reality is for the next two to three years, we will see slightly higher costs at this operation than previously,” he said.

“But we fully expect following that remediation work that those costs will revert back to the very competitive costs that we’ve seen in the past.”

Saracen’s managing director Raleigh Finlayson was in Sydney yesterday as the company sought to bed down a $796 million equity raising to help fund the acquisition.

Subscribe to the RRS Weekly Wrap

© 2019 Resources Rising Stars All Rights Reserved