The deal enables Barrick to become a major shareholder in Skeena
Eskay Creek is located in the Golden Triangle of northwest British Columbia. (Credit: Eric Chegwin/FreeImages)
Canadian mining exploration company Skeena Resources has signed an agreement with Barrick Gold to acquire the Eskay Creek gold-silver project.
Eskay Creek is located in the Golden Triangle of northwest British Columbia, Canada.
Discovered in 1988, the former Eskay Creek mine produced nearly 3.3 million ounces of gold and 160 million ounces of silver.
The deal enables Barrick to become a major shareholder in Skeena.
Skeena’s CEO, Walter Coles Jr. commented, “We were encouraged by the positive market reaction to the announcement of the binding term sheet in respect to the Eskay Creek transaction with Barrick and are delighted to now announce the signing of the Definitive Agreement.
“On closing, Skeena will gain 100% ownership and operatorship of Eskay Creek, which we hope to revitalize as an open-pit gold-silver mine. Skeena is honoured to have Barrick as an important shareholder in the Company going forward.”
In July, Skeena had signed a binding agreement Barrick Gold, a wholly owned subsidiary of Barrick Gold Corporation, to acquire the project.
Barrick to hold 12.4% of issued and outstanding common shares of Skeena
Upon completion of the acquisition, Barrick will hold 24,075,000 Skeena common shares, representing nearly 12.4% of Skeena’s issued and outstanding common shares.
As part of the consideration for the transaction, Skeena will also grant a 1% net smelter return (NSR) royalty on the entire Eskay Creek land package.
The transaction is expected to be completed the fourth quarter of 2020, subject to customary conditions, including certain government approvals.
Last month, Skeena Resources announced a maiden resource estimate for the Snip gold project located in the Golden Triangle of northwest British Columbia.
Skeena acquired the Snip mine, which produced approximately one million ounces of gold from 1991 until 1999, from Barrick Gold in 2017.