By PAM GRAHAM
A For Sale sign on Waihi's Martha Hill gold mine does not seem to have tempted the only other major gold miner in New Zealand.
Australia-based GRD was aware that Martha Hill was being marketed but preferred to develop its own assets, said finance director Andrew Bantock yesterday.
GRD, the biggest gold miner in New Zealand, yesterday reported a record gold output from its GRD Macraes operation in the South Island of 174,929oz, and production is expected to double by 2006/7.
The Herald understands that bids were called for Martha Hill about two months ago and it was down to four overseas bidders just before Christmas. The mine has a price tag of more than US$50 million.
Dave Ingle of Martha Hill's owner, Newmont Waihi, a subsidiary of Denver-based Newmont Mining, would only say yesterday that his company was bound to look at opportunities that created value, such as selling the business.
A buyer of Martha Hill would be interested in underground reserves adjacent to the existing pit, which is near exhaustion.
Gold prices have risen from US$250/oz three years ago to more than US$400/oz this month.
GRD said yesterday that it had achieved an average gold price of A$614/oz in 2003, up from A$593 the previous year. It achieved a gross operating margin of A$254/oz.
Its Macraes New Zealand gold mining business was hurt by higher electricity prices in the first half of the year, but costs were cut in the second half to counter the impact and it now has hedges back in place.
GRD is selling some of Macraes in an initial public offering in March.
The IPO, which encompasses a share buyback and selldown by GRD, is expected to raise $50 million of new money for investment. The new listed entity, known as Oceana Gold, will be 60 per cent owned by GRD.
GRD passes up Martha Hill temptation
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