Equinox Gold Corp. has announced that it has entered into an agreement with an affiliate of the Orion Mine Finance Group to acquire 10% from Orion’s current interest in the Hardrock Mine Project for consideration of US$51 million plus certain contingent payment obligations (the Hardrock Transaction).
The Hardrock Project is a multi-million-ounce, fully permitted, construction-ready gold project located in Ontario, Canada, and currently owned 50% by Orion and 50% by Premier Gold Mines Ltd. Equinox Gold will acquire a 50% interest in the Hardrock Project upon completion of the company’s pending acquisition of Premier, and will subsequently increase its interest to 60% upon completion of the Hardrock Transaction. Orion will retain a 40% interest in the Hardrock Project.
Christian Milau, CEO of Equinox Gold, stated: “We are extremely pleased to increase our stake in this world-class Canadian gold deposit located in one of the world’s top mining jurisdictions. Hardrock will be a low-cost, long-life gold mine, bringing more than 240 000 attributable ounces of annual gold production to Equinox Gold when in production, with significant upside potential from near-mine exploration and underground development. We look forward to working with Orion to advance Hardrock to production, bringing long-term benefits to all stakeholders of the Hardrock Project and particularly First Nations and other communities in the Greenstone region of Ontario.”
Terms of the Hardrock Transaction include:
- Payment on closing of US$51 million, of which up to US$41 million can be paid in shares of Equinox Gold, at Equinox Gold’s option.
- Assumption of certain contingent payment obligations comprising:
- US$5 million in cash 24 months after a positive mine construction decision for the Hardrock Project.
- Delivery of approximately 2200 oz of refined gold, the cash equivalent value of such refined gold, or a combination thereof, after production milestones of 250 000 oz, 500 000 oz, and 700 000 ounces from the Hardrock Project.
The Hardrock Transaction is subject to closing of Equinox Gold’s acquisition of Premier, which was approved by Premier shareholders on 23 February 2021 and is expected to close in March 2021, subject to regulatory and court approvals and customary closing conditions.
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