Northern Star buys some ironwork

Northern Star Mining (NSM-V) continues its garage-sale prowl in northwestern Quebec’s Abitibi region. Having already bought a bargain headframe and hoist for its underground operation at Midway, near Malartic, it has now bought the former Beacon gold mine, 15 km east of Val d’Or, largely for its mothballed mill.

Beacon, which produced gold briefly in the flow-through era of the late 1980s, had been held by a private company, Jake Resources. Under the deal, Northern Star takes over both mine and mill for $6.5 million. There is a due-diligence period and final payment terms are still under negotiation.

The mill has a rated capacity of around 800 tonnes per day and is in operating condition. It is a conventional cyanidation mill with a Merrill-Crowe recovery system.

Northern Star also bought back the net smelter return royalty on the Midway property, for $2.5 million. Payments under the royalty ranged from 2.5% (at gold prices less than US$275 per oz.) to 7% (for prices over US$500).