New Gold to sell BC project to Artemis for $140 million

The Toronto-based miner will receive a gold stream on 8% gold produced from Blackwater. That total will be reduced to 4% once the company has received 280,000 ounces of gold.

As part of the deal, New Gold will acquire as much as 9.9% of Artemis’ common shares for C$20 million at the close.

“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,” New Gold’s chief executive, Renaud Adam, said in the statement.

Blackwater is a proposed open-pit gold and silver mine located 160 km southwest of Prince George.

Currently in the exploration phase, the project has 8.2 million ounces of gold in proven and probable mineral reserve, and 60.8 million ounces silver. In the measured and indicated category, Blackwater holds 1.4 million ounces gold and 8.7 million ounces silver in reserve.

Last year, the project was granted federal and provincial environmental assessment certificates, but it must still go through the mine-permitting phase.

As proposed, the Blackwater gold project would produce 60,000 tonnes per day of gold and silver ore, over a mine life of 17 years. The project could create up to 1,500 jobs during construction and 495 during operations, according to New Gold’s figures.

Under a benefit agreement with the provincial government, two First Nations will receive as much as $217 million, with the revenue split evenly between them.

The Lhoosk’uz Dené and Ulkatcho bands also had a separate agreement with New Gold, in which they have direct participation in the project.