Kundana

The East Kundana Joint Venture (Northern Star Resources 51%, Rand and Tribune 49%) is an operational underground gold mining project located in the Eastern Goldfields of Western Australia, 25 kilometres north-west of Kalgoorlie. The project comprises three producing underground deposits, Raleigh, Rubicon and Hornet.

The nearby Pegasus deposit has current total estimated resources of 3.0Mt at 11.6g/t Au for 1.1 million ounces of gold (see NST news release dated 16 February 2015). A significant resource development and expansion drilling program has been approved in conjunction with rapid capital development to bring this area into production by 2015.

History

Prospecting and small-scale mining in the Kundana area commenced circa 1895. A small town called “21 mile” was established that later became known as Kundana. Modern mining began in 1988 in the original Kundana South, Kundana North and Strzelecki open pits.

Mineralisation was discovered at the Rubicon project in 1999. The project includes the separate deposits of Rubicon, Hornet and Pegasus located on strike along the K2 mineralised trend. The Raleigh deposit, located two kilometres to the northwest on the Strzelecki trend, was discovered in 2000. Open pit mining commenced at Rubicon and Raleigh in 2002. Underground production from Raleigh was realised in 2006 and from Rubicon-Hornet in 2011.

A 51% ownership stake in the Kundana operations was acquired by Northern Star Resources Limited through the acquisition of Gilt-Edged Mining, a wholly owned subsidiary of Barrick Gold, on 1 March 2014.

Geology and Mineralisation

The main host structure at Rubicon, Hornet, and Pegasus (K2) is a steeply west-dipping laminated shear vein that generally ranges between 0.3 and 0.8 metres in thickness. The ore zone is typically wider than the vein structure (up to 5 metres) due to the presence of mineralized footwall stockwork veins and breccia zones. The vein typically contains coarse-grained disseminated galena, sphalerite, scheelite and gold.

Gold mineralisation at the Raleigh deposit is associated with a steeply west-dipping laminated quartz vein system (Strzelecki structure) developed at the contact between andesitic volcanics and a sedimentary unit in the immediate footwall of a thick, differentiated gabbroic sill (Powder Sill). Vein infill mineralogy is similar to that described above for the K2 structure.

Mining

The mining method at the Kundana operations is from underground utilising up-hole longhole stoping with paste back-fill.

The Rubicon orebody is located beneath a previously mined open pit. Access to the ore body is via a decline developed from the open pit and positioned west of the vein. Stoping is carried out by drilling upholes between levels and mining panels along strike. Most stopes are paste-filled unless geotechnically stable to leave open or as pillars. The paste fill is hauled to the mine from the paste-fill plant at Raleigh.

The Hornet orebody is located 600m to the south of the Rubicon orebody. Access to the ore body is via a decline developed off the Rubicon decline. Stoping is carried out by drilling up-holes between levels and mining panels along strike.

The Pegasus deposit is located 480m to the north of the Rubicon orebody and access is from the established Rubicon decline. Stoping is carried out by drilling upholes between levels and mining panels along strike.

Processing

Ore from the Kundana operations is treated at the NST owned Kanowna Belle processing facility located adjacent to the Kanowna Belle mine. The plant is designed to handle approximately 1.8 million tonnes of feed per annum and has the capability to treat both refractory and free milling ores through the flotation circuit and associated concentrate roaster circuit, including carbon-in-leach (CIL) gold recovery, or bypassing the flotation circuit and going directly to a CIL circuit that is designed to treat flotation tails.