Northern Star Resources has closed the previously announced $260m transaction to buy the Pogo underground gold project in Alaska, US, from Sumitomo Metal Mining and Sumitomo.

The agreement for the transaction was signed in August.

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Prior to the conclusion of the transaction, Sumitomo Metal Mining operated the mine with an 85% interest, while Sumitomo owned the residual 15% interest.

As a result of the acquisition, Northern Star has updated its production guidance for the financial year 2019 to 850,000oz-900,000oz.

“I would like to thank Sumitomo for their assistance and the outstanding condition in which they have left the Pogo mine.”

The company is now focused on converting the Pogo mine’s 4.1Moz gold inventory to Joint Ore Reserves Committee (JORC) status.

Northern Star Resources executive chairman Bill Beament said: “On behalf of Northern Star, I would like to thank Sumitomo for their assistance and the outstanding condition in which they have left the Pogo mine.”

Pogo produced 3.8Moz at 13.6gpt over the past 12 years at an average rate of around 300,000oz per annum.

The project is located 145km south-east of Fairbanks in the Tintina Mineral Belt, which is a 200km-wide, 1,200km-long arc comprising mostly gold deposits.

As at 31 December last year, the project had resources of 3.34Moz at 12.3gpt and reserves of 760,000oz at 11.9gpt.

The company arranged funding for the transaction by completing an A$175m fully underwritten placement to institutional investors.

At the time of signing the deal in August, Beament said that Northern Star’s decision to buy the project was influenced by the potential to grow its resources and reserves, mine life, production and cash flow.