Northern Star Resources does not expect to produce from its Hemi deposit in the Pilbara until the early 2030s, as approvals drag on for the lucrative gold project.
Northern Star Resources does not expect to produce from its Hemi deposit in the Pilbara until the early 2030s, as approvals drag on for the lucrative gold project.
Northern Star revealed it had pushed back its deadline for a final investment decision at Hemi this morning, with the 2027 financial year now the target.
The state’s largest goldminer by ounces produced had previously hoped to pull the investment trigger at Hemi this financial year, with first production targeted in FY29.
Today’s news shifts first gold back to at least FY30, and the delivery of long lead items at Hemi has also been pushed back.
Northern Star chief executive Stuart Tonkin told an investor call this morning that the goldminer was in no rush to develop the 11.2-million-ounce Pilbara project.
Northern Star expects primary approvals this quarter on the state level, and federal approvals are about to be opened for public comment.
“It’ll be a four-week public comment period, and then there’ll be iterations of request back and forward with the regulator,” Mr Tonkin said of the federal process.
“We don’t really control that timeframe. The processes have timelines that you enter into. We expect that during this year, ideally this financial year, but we can’t be certain on that process.
“History has told us things do slip – they don’t go quicker.”
Mr Tonkin said secondary approvals were also in the works, including those for dewatering operations which have proved a point of pressure with traditional owners in the area.
“We expect and plan for those things to occur this calendar year, and therefore we just want that time to prudently go through and present that case to the board,” he said.
Northern Star struck a $5 billion all-scrip deal to acquire Hemi owner De Grey Mining in late 2024, with the Pilbara project the jewel in the crown.
De Grey had originally set an ambitious target in the Hemi definitive feasibility study to take FID in mid-2024 and deliver first ore during FY26.
Northern Star never committed to those timeframes and has set about updating the studies that inform the project’s economics – expected in May in this year.
The project was given a price tag of $1 billion by De Grey, but that appears likely to grow once Northern Star runs its numbers.
“Once the approvals and the timing is clear to us, we reprice the capital,” Mr Tonkin said.
“That’s what goes in with some pretty hard, firm, all-encompassing numbers into the financial case that is considered by our board.”
The revelation of a Hemi pushback came as Northern Star released its half-year production results.
The goldminer delivered underlying net profit of $760 million during the half and declared a fully-franked dividend of 25c per share.
It expects to have its Kalgoorlie Consolidated Gold Mines mill expansion constructed by mid-2026, ramping up to its full 27 million tonne per annum production capacity in the years ahead.
Northern Star shares were flat in early trade, at $28.26 per share.
