Consolidation of mining companies in the face of volatile global gold prices is nothing new, but Oceana Gold is one of the best-positioned companies to effect a buyout or takeover.
Oceana has evolved from being a successful miner of relatively low grade ore from open pits, to specialise in higher-yielding underground mines, with three underground operations; one producing and two in development.
The third was yesterday's purchase of Newmont Gold Corp's Waihi operation, for $NZ132 million, with the Correnso development underground mine about to go into production.
It is a far cry from the Oceana which in 2004 first started the inaugural Frasers underground mine at Macraes in East Otago.
That had to be abandoned in early 2005 after only 400m of tunnelling because of unforeseen geological difficulties, but after redesign, it resumed the development the following year.
At a time when cash is king, Oceana is prudently making the most of its increasing cash flows, underpinned by its copper sales from the Didipio gold and copper deposit in the northern Philippine island of Luzon.
More than $US160 million ($NZ209.6 million) in debt has been removed from its balance sheet during the past 18 months and its war chest has grown to almost $US60 million cash in hand.
As its open pit operations in New Zealand come under increasing pressure because of low gold prices, it has just extended Frasers' mine life and refocused development at Didipio on more lucrative underground targets.
Oceana chief executive Mick Wilkes said while Waihi's purchase meant debt would almost triple, from $US45 million to about $US120 million, he was not concerned as Oceana had a ''relatively low'' debt to equity gearing.
Sales of the copper by-product from its high-grade gold operations in the northern Philippines offsets its cost of the gold production, into a negative cost, making it one of the most efficient gold producers.
Elsewhere, hundreds of ''junior'' gold explorers and producers across the world are struggling with gold prices languishing around $US1200 per ounce, and mothballing or quitting operations.
Mr Wilkes was upbeat about the possibility of more acquisitions in the future.
''We have the financial capacity to make more acquisitions,'' he said.
He set aside the question of any revival of last year's reports of a takeover of Alacer Gold Corp and its Turkish gold mine.
He said Alacer ''was long gone'' and sidestepped a direct question on being interested in Barrick's Cowal mine in New South Wales which produced 268,000 oz in 2014, saying only it was ''in the right part of the world''.
Oceana's acquisition preference was for a mine ''of a similar size'', noting areas of interest were in Asia and the Americas, Mr Wilkes said.
To fund the Waihi purchase, Oceana had cash in hand of $US59.6 million and had drawn $US77.8 million from its revolving credit facility, which left $US97.2 million undrawn, Mr Wilkes said.
To ensure a ''sufficient liquidity buffer'', Mr Wilkes said Oceana had received ''highly confident letters'' from its banks to increase its revolving credit facility to a total $US225 million.
