One Of The Largest Open-Pit Gold Deposits In Canada
Artemis Gold Inc. (TSXV: ART) has signed an Asset Purchase Agreement with New Gold Inc. to acquire the Blackwater Gold Project in central British Columbia.
Artemis will make an initial cash payment of C$140 million at closing of the acquisition, along with the Issuance to New Gold of Artemis shares having an aggregate deemed price of C$20 million.
A second cash payment of C$70 million, less approximately C$20 million will be made 12 months after closing.
Blackwater has significant Mineral Resource of 9.5 million ounces, Measured and Indicated, with robust economics based on the 2014 Feasibility Study.
Chairman and CEO of Artemis, Steven Dean, said the company will be targeting improved economics and financeability against the 2014 Feasibility Study based on Artemis due diligence including the following:
- Reducing initial capital expenditures by staging the mine throughput ramp-up while remaining committed to the full-scale project;
- Targeting lower initial start-up capital expenditure with 1-2 subsequent expansion stages to the 20 mtpa Feasibility Study case, estimated to be funded from future operating cashflows;
- Our MIK (Multiple Indicator Kriging) approach to resource modelling may further optimize tonnes and grades within the pit;
- The 2014 Feasibility Study resource modelling identifies a large higher-grade zone of mineralization near-surface within the southern half of the pit design which will be the focus of further mine planning analysis by Artemis;
- The application of our grade control drilling approach and modeling methodology may optimize mine scheduling, grade cut-off strategies, and better define ore and waste boundaries within the pit; and
- Methodical de-risking of key project risks
Mr Dean said that while the vompany considers the 2014 Feasibility Study to be current, it plans to prepare an updated Pre-Feasibility Study based on our revised approach to developing the Project over the next three months and will file the technical report within 180 days of this announcement of mineral resources and mineral reserves.
“The proposed acquisition of Blackwater is the first meaningful step in our strategy to develop a first-tier gold deposit in one of the world’s premier low risk mining jurisdictions,” Mr Dean said.
“As with our team’s previous success in developing the Moose River Consolidated Mine in Nova Scotia for Atlantic Gold, our focus will be the methodical de-risking of the project development to enhance NPV, optimize IRR and minimise equity dilution to shareholders.
“Furthermore, the additional attribute of having an environmental assessment approval in hand significantly curtails the timeline to construction and ultimate production. This value cannot be underestimated in today’s world.
“We look forward to completing the Acquisition in due course, working with the various key stakeholders to continue to advance Blackwater through the development stage and into operation.”
The Project is located in central British Columbia, approximately 160 km southwest of Prince George and 446 km northeast of Vancouver. The Project is accessible by major highway and access road.
Artemis is acquiring New Gold’s 100% recorded interest in 328 mineral claims covering an area of 148,688 ha distributed among the Property and the Capoose, Auro, Key, Parlane and RJK claim blocks. Surface rights over the Project area are controlled by the Crown.
The Project received a federal Decision Statement and a provincial Environmental Assessment Certificate in June 2019, which are major milestones in respect of de-risking the Project to ultimate permitting and construction. Additional permits and authoridations are required from both the provincial and federal governments prior to the mine proceeding to the construction and operation phase, including provincial permits under the Mines Act and the Environmental Management Act for discharge, and federal authorizations under the Fisheries Act and Explosives Act. Management will be working closely with New Gold to transition efforts to date to Artemis to ensure management are able to progress the permitting timeline.