Northern Star Resources reported that its A$50 million exploration program during its financial year ending June 30 increased gold resources at its mines and exploration properties in Western Australia by 2.7 million oz to 8.9 million oz, a gain of 44%. The company’s reserves increased by 26% to 1.5 million oz over the same period.

The mineral resource estimate is based on 75 million mt at a grade of 3.7 g/mt gold. The reserve estimate is based on 8.6 million mt at 5.4 g/mt gold.

Northern Star reported its resource and reserve increases after deduction of 622,000 oz of gold that the company had produced since its previous reserve estimate.

Northern Star is 100% owner and operator of four mines in Western Australia—Jundee, Kanowna Belle, Plutonic and Paulsens—and is 51% owner and operator of the Kundana mine. Kanowna Belle and Kundana are located near Kalgoorlie. The other mines are located farther north and west in the state. The company’s reported resources and reserves include only its attributable interest at Kundana.

Northern Star’s exploration strategy is focused on extending mine lives across its portfolio. Regarding the results of this strategy over the past year, Managing Director Bill Beament said, “We have always said that the major gold systems at each of our projects would be shown to host significantly more gold. These results prove that to be the case. They also provide us with further confidence that we will continue to identify more gold and continue to grow mine lives.”

Much of Northern Star’s increased gold inventory is located at Jundee and its Kalgoorlie operations; however, the company also more than replaced the ounces produced at Paulsens and Plutonic during the year. The additional resources were defined at a cost to Northern Star of A$19/oz.

“The simple fact is we would never be able to acquire resources or reserves at anywhere near that price,” Beament said. “Growth through exploration unquestionably delivers shareholders superior returns. The economics of this strategy are even more attractive when it is remembered that each new ounce allows us to further leverage our existing infrastructure.”

At Jundee, where total resources increased by 59% to 1.35 million oz, drilling has discovered high-grade mineralization down to 500 m below existing resources. This mineralization is not included in the latest resource estimate, but will be the subject of A$17 million in exploration drilling during the coming year.

Northern Star is forecasting production of 535,000 to 570,000 oz of gold during its current fiscal year at an all-in sustaining cost of A$1,050 to A$1,100/oz. The forecast reflects mine schedules designed to optimize its asset base to sustain production rates over the long term.

Beyond the current year, scheduling will be altered to reflect the start of production at company’s 25% owned Central Tanami project and additions to production resulting from its exploration success.