Artemis Gold has completed its previously announced acquisition of the Blackwater gold-silver project in central British Columbia from fellow Canadian miner New Gold.
The total purchase price comprises an initial payment of $140 million, issue of approximately 7.4 million Artemis shares at $2.70 per share, and a second cash payment of $50 million, paid one year following closing.
The initial payment was funded through subscription receipt financings announced in June, under which Artemis issued 64.8 million subscription receipts, at $2.70 each, for total proceeds of approximately $175 million.
The Blackwater project, located 160 km southwest of Prince George, B.C., is a proposed open-pit mine that would produce 60,000 tonnes of gold and silver ore per day over a mine life of 17 years.
Artemis has also entered a gold stream agreement with New Gold, whereby the latter will purchase 8% of the refined gold produced from Blackwater. Once 279,908 oz. of refined gold have been delivered to New Gold, the gold stream will reduce to 4%.
New Gold will make payments for the gold purchased equal to 35% of the U.S. dollar gold price quoted by the London Bullion Market Association two days prior to delivery.
Should the Blackwater project fail to achieve commercial production by the seventh, eighth or ninth anniversary of closing, New Gold is entitled to receive additional cash payments of $28 million on each of those dates.
Shares of Artemis Gold surged 5.6% by 12:30 p.m. EDT Monday. The Vancouver-based miner has a market capitalization of $172.4 million.
This story originally appeared on www.Mining.com.