VANCOUVER—Goldcorp Inc. has inked a half billion dollar deal to buy fellow gold miner Kaminak Gold Corp, acquiring a 100 per cent interest in a major mining project in Northern Canada.
The $520 million all-stock agreement will hand over control of the Coffee Gold Project outside Dawson City, Yukon to the Vancouver-based mining firm.
Located along the Klondike Highway northwest of Whitehorse, Dawson has a long tradition of gold mining stretching back more than a century to the Klondike gold rush in the late 19th century. Gold was discovered in 16 separate locations at the Coffee site in 2010 and the project has been inching toward development since. Studies have shown the site has probable gold reserves of approximately 2.2 million ounces.
“Coffee is located within a politically stable jurisdiction and provides us with an opportunity to add high quality ounces to our development pipeline, at low all-in sustaining costs,” David Garofalo, the company’s president and CEO, said.
Along with the stable production, Goldcorp said the site’s 60,000-hectare land package offers “significant potential” for near-mine discoveries.
The acquisition will provide Goldcorp with its first foothold in the arctic. Along with mines in Latin America, the company operates four other mines in Canada, all located in Ontario and Quebec.
Cleared by both Goldcorp’s and Kaminak’s boards, the deal still requires shareholder and regulatory approvals. It’s expected to close no later than August of this year.