Barrick Gold buys Nevada mining project from former partner
Barrick Gold (TSX, NYSE:ABX), the world’s largest producer of the precious metal, has finalized the acquisition of a mining project in Nevada that abandoned in 2015 due to budgetary constraints.
But since gold prices staged a comeback last year, the Toronto-based miner approached its former partner Coral Gold Resources (TSXV:CLH) to buy the Robertson Property, located 60 miles south of Elko, Lander County, Nevada.
Barrick's vision is to create a multi-mine operation in Nevada.
As part of the transaction finalized Thursday, Barrick paid Coral $15.75 million (Cdn$20.27 million based on the current exchange rate) in cash as well as the return of 4,150,000 common shares of Coral held by the gold giant.
The deal also included a sliding scale 1% to 2.25% net smelter returns royalty, payable quarterly, subject to potential advance royalty payments
If the Robertson property is not placed into production by December 31, 2023, then beginning January 1, 2024, and continuing on an annual basis thereafter until the earlier of the date commercial production begins and January 2, 2033, Barrick will make advance royalty payments to Coral Gold of $0.5M, which will be non-refundable and fully credited against any future obligations under the NSR. Barrick will also assume all liabilities relating to the Robertson property, and will provide replacement security for the reclamation bond.
The Robertson property includes the Core, Gold Ridge, Excluded and the RUF mining claims, but does not include the assets known as the Norma, Sass, Eagle and JDN mining claims, which remain the property of Coral.
Robertson covers about 8,480 acres and is comprised of 415 claims and nine patented claims. Consolidation of the ownership of the property will allow the project to benefit from Barrick’s Cortez operation.
The gold producer’s vision is to create a multi-mine operation that will deliver long-term value to its shareholders and community partners in Nevada, Rob Krcmarov, Barrick’s executive vice president, exploration and growth, said in the statement.
Vancouver-based Coral said it will use the funds to advance its other projects on the Cortez Trend.