Probe Gold adds Monarch’s key assets to Quebec-focused portfolio

Probe Gold’s Novador project lies among three past-producing mines in Quebec’s Abitibi region. Credit: Probe Gold

Québec-focused Probe Gold (TSX: PRB) has made a strategic acquisition with the purchase of key assets from its struggling neighbor Monarch Mining (TSX: GBAR) to complement its 100% owned flagship development project, Novador.

Under a definitive purchase agreement signed Monday, Probe will acquire the McKenzie Break and Beaufor properties from Monarch, which has been placed under creditor protection since November 2023. The consideration is be payable in a combination of cash and shares.

The Beaufor property lies immediately next to Probe’s Novador project and consists of 23 mineral claims covering 6.9 square kilometres. The property hosts a current measured and indicated gold resource of 219,200 oz. at 5.3 g/t and inferred gold resource of 122,500 oz. at 4.7 g/t.

The McKenzie Break property is host to a high-grade gold deposit situated only 20 km north of the Novador project. The property hosts a current indicated gold resource of 146,000 oz. at an average grade of 3.2 g/t, plus an inferred gold resource of 250,600 oz. at 3.1 g/t.

“The tuck-in acquisition of the Beaufor and McKenzie Break properties is a strategic fit with our current development model in Val-d’Or,” Probe Gold CEO David Palmer said in a news release.

The Beaufor property, said Palmer, was “the missing piece” in the company’s Novador claim fabric and will complete its consolidation of the Courvan trend, which now includes the Courvan, Senore and Beaufor deposits. Beaufor is host to a former mine that has produced 1.2 million oz. in the past.

The McKenzie Break property is also within trucking distance of Novador and hosts higher-grade gold resources with “tremendous” exploration upside, Palmer added.

Novador represents a district-scale land package comprising 436 sq. km., making it one of the largest landholdings in Québec’s Val-d’Or mining camp. Its current measured and indicated resource totals over 2 million oz. (41.8 million tonnes grading 1.52 g/t).

A preliminary economic assessment this year estimated a C$910 million net present value (at 5% discount) for the project, with an internal rate of return of 24.4%. Annual production is expected to average 255,000 oz. over a mine life of 12.6 years.

Overall, the transaction will add 365,200 measured and indicated and 373,100 inferred oz. of higher-grade gold to Probe’s current resource inventory, and will provide an additional 85 sq. km. of underexplored ground for further expansion and discovery.

Upon closing, the company’s landholding in the Val-d’Or region will total 685 square kilometres.