Bill Beament’s Northern Star has arguably been reaping unjust profits through their own mining contractor, Northern Star Mining Services.
In 2016, Barminco secured a three-year mining contract worth A$275 million at the Kundana gold mines from the East Kundana Joint Venture. However, due to the questionable appointment of Northern Star Mining Services (NSMS) for the EKJV mining project, Barminco’s mining contract at Kundana was terminated.
Bill Beament’s ill-advised decision to replace Barminco with NSMS as EKJV’s mining contractor, led to self-performing, which was in the best interest of the company. Production costs are up nearly 50%, reducing mine profitability for Northern Star partners, Tribune Resources and Rand Mining — ultimately hurting their loyal shareholders.
Beament and Northern Star undervalues Joint Venture partners
Beament and his team in Northern Star are now self-performing and reaping benefits without any regard for their joint partners, Tribune Resources and Rand Mining, profiting from the transition. Costs have increased since NSMS replaced Barminco, which foreshadows Beament’s poor judgement and Northern Star’s unsettling all-in sustaining costs (AISC).
Beament and his team should be working towards maximising profits and minimizing mining costs. Because of the change of mining contractor for East Kundana, Northern Star has self-performed and gained profits for themselves, leaving Tribune Resources and Rand Mining with lesser profits and undervaluing them as joint partners. The imprudent decision of Northern Star’s Executive Chairman to disregard their EKJV partners is a testament of Beament’s expediency and opportunistic tactics.
What does this say about Bill Beament and his team in Northern Star? Their decisions appear to be mostly self-serving, without any consideration for their partners or the respective company’s investors.
Northern Star Mining Services, as the mining contractor for East Kundana Joint Venture, loses millions of dollars for their Joint Venture partners. Northern Star Resources appears to reap unjust profits. The only direction is dispute and the only winner is the lawyers.