Newmont Goldcorp to grab 10% of GT Gold
North of 60 Mining News – May 10, 2019
Last updated 9/25/2020 at 4:36pm
GT Gold Corp. May 9 announced that Newmont Goldcorp Corporation has agreed to invest C$17.6 million into an upcoming financing, a strategic investment that will accelerate the exploration and development of the Saddle North and Saddle South targets on GT Gold's Tatogga property in northwestern British Columbia.
"Newmont Goldcorp's investment is a significant milestone for GT Gold and represents a strong endorsement of our Tatogga property and recognizes the area's appeal as a highly prospective gold district," said GT Gold President and CEO Steve Burleton.
The Tatogga property hosts Saddle South, a high-grade and potentially large gold deposit, and Saddle North, a lower grade but much larger gold-copper porphyry target that runs parallel to Saddle South.
Highlights from drilling at Saddle South over the previous two seasons include:
• seven meters of 51.53 grams per metric tons gold;
• 12.2 meters of 14.75 g/t gold;
• 3.4 meters of 48.85 g/t gold;
• 8.3 meters of 20.02 g/t gold; and
• three meters averaging 31.79 g/t gold.
It is likely that Newmont Goldcorp is more interested in Saddle North, where last year's drilling began to outline a large gold-copper-silver deposit.
TTD109, the deepest hole drilled so far at Saddle North, cut 1,149.7 meters averaging 0.62 g/t gold, 0.36 percent copper and 1.17 g/t silver starting from a depth of 11.33 meters. This includes 342.5 meters of 1.28 g/t gold, 0.57 percent copper and 2.3 g/t silver from a depth of 740 meters.
Other highlights from the 11 holes drilled at Saddle North include:
• 822.2 meters of 0.42 g/t gold, 0.26 percent copper and 0.62 g/t silver in TTD085;
• 904.1 meters of 0.51 g/t gold, 0.3 percent copper and 0.93 g/t silver in TTD093;
• 685 meters of 0.4 g/t gold, 0.26 percent copper and 1.03 g/t silver in TTD098; and
• 323.84 meters of 0.43 g/t gold, 0.32 percent copper and 1.09 g/t silver in TTD108.
To gain a foothold on this exciting Golden Triangle property, Newmont Goldcorp has agreed to acquire 11.49 million GT Gold flow-through shares priced at C$1.53 each.
In Canada, flow-through financings allow exploration companies to transfer exploration expenses to individual investors that purchase the flow-through shares. The flow-through investor, in turn, can apply his portion of the exploration expense to reduce or eliminate his tax liability.
The money raised in such a financing must be applied to qualifying exploration expenditures in Canada.
Upon closing of the financing, Newmont Goldcorp will own 9.9 percent of GT Gold's outstanding shares.
In connection with the transaction, Newmont Goldcorp will have certain rights including the right to:
• designate one nominee for appointment to the GT Gold board of directors of the Company for as long as Newmont Goldcorp holds at least 5 percent of the exploration company's outstanding shares;
• appoint half the members of a newly formed joint technical committee;
• maintain its pro-rata ownership in GT Gold and, under certain circumstances, increase its ownership up to 14.9 percent of the outstanding shares of the company; and
• a right of first offer on Tatogga, if GT Gold seeks to divest all or a part of its interest in the promising gold-copper-silver property.
"Newmont Goldcorp will bring significant technical expertise which will help GT Gold accelerate the development of Saddle North and our understanding of the geological potential of our large land package through this exciting phase of exploration."
The financing is scheduled to close on May 30.