Kinross leverages its White Gold project
Last updated 1/15/2018 at 6:35pm
Kinross Gold Corp. May 18 said it has cut a deal to trade its White Gold project and other properties in the Yukon to White Gold Corp. in exchange for a 19.9 percent stake in the junior gold explorer.
White Gold owns 23 properties covering 2,970 square kilometers (roughly 633,900 acres) of gold prospective lands in the Yukon, most of which were acquired from legendary prospector Shawn Ryan and Wildwood Exploration Inc., a company owned by Ryan and his wife, Cathy Wood.
"We are very excited to be acquiring Kinross' Yukon portfolio; including the White Gold property," Ryan, who is chief technical advisor to White Gold Corp., said. "The acquisition adds significant exploration potential to our already dominant land position in the White Gold District. "Our ultimate goal in the Yukon is to leverage our team's track record of successful exploration and discovering mineral resources in order to discover additional gold deposits and this acquisition greatly enhances our prospects."
For its part, Kinross said its strategic ownership in White Gold Corp. will provide future optionality in the highly prospective White Gold District, and across the Yukon.
In a separate transaction, Agnico Eagle Mines Ltd. will also own 19.9 percent interest in White Gold Corp. Both Kinross and Agnico Eagle are expected to leverage their technical and operational experience to support White Gold Corp.'s pursuit of exploration and development opportunities in the Yukon, including at the White Gold property.
"We look forward to working with Agnico Eagle and White Gold Corp. to support the pursuit of quality development opportunities in this highly prospective and largely underdeveloped district," said Kinross President and CEO J. Paul Rollinson. "This investment will allow the three companies to pool their expertise together to strengthen their position in this excellent mining jurisdiction."
In addition to the issuance of 17.5 million shares, White Gold has agreed to pay Kinross roughly US$7 million upon the closing of the deal and make three equal payments of approximately US$3.7 million - first payment is due upon a preliminary economic assessment for the White Gold property, second upon the completion of a feasibility study, and third when a positive construction decision has been made for the gold property.
Kinross will also enter into an investor rights agreement with White Gold Corp. that will provide Kinross with the right to maintain its ownership position through participation in any future equity financings, and the right to nominate a board member in White Gold Corp.
The White Gold property hosts 9.79 million metric tons of indicated resource averaging 2.7 grams per metric ton (840,000 ounces) gold; and 2.17 million metric tons of inferred resource averaging 1.8 g/t (125,000 oz) gold, according to Kinross' reserves and resources statement for the end of 2016.