New Gold Inc announced the sale of its Blackwater Project to Artemis Gold for $190 million on Tuesday, June 9.
In a news release, New Gold Inc wrote that they have entered into an agreement with Artemis Gold for CAD $190 million in cash and are retaining their exposure by keeping an eight percent gold stream and equity stake in Artemis. The transaction is expected to close in the third quarter of 2020.
As part of the deal, New Gold will acquire 9.9 percent of Artemis’ shares.
In a statement Renaud Adams, CEO of New Gold Inc said, “we believe that surfacing value for Blackwater today, while retaining exposure to the project through a retained gold stream and an equity position in Artemis, allows the Company to transition to the next phase of our growth plan as we continue to reposition the Company for shareholder value creation.”
The Blackwater Gold Project is estimated at $1.8 billion and the project got both Federal and Provincial Environmental Assessment approvals. However, the project still needs to go through the mine permitting phase.
The project consists of the construction, operation and closure of an open-pit gold and silver mine located 110 km southwest of Vanderhoof, B.C. The Blackwater Gold Project sits on the traditional lands of the Ulkatcho (Anahim Lake) First Nation and Lhoosk’uz Dené (Kluskus) Nation.
The Blackwater Gold project is estimated to produce 60,000 tonnes per day of gold and silver ore, for a mine life of 17 years.
In a news release by Artemis Gold Inc on June 9, the company said in the coming months they will be focusing on completing financing and other conditions needed to close the deal. Other than that, the company will work towards establishing relationships, and continuing engagement with First Nation communities affected by the project.
Over the next three months, Artemis will also complete an updated pre-feasibility study, the company said.