Canada’s Barrick Gold, the world’s biggest producer of the yellow metal, has bought a 20 per cent stake in Midas Gold, which is developing a project in Idaho, for $38m.
The investment will give Barrick exposure to the Stibnite Gold project, which the company says has the potential to produce over 300,000 ounces of gold a year.
Toronto-listed Midas Gold is attempting to renovate an old mining site in Idaho into a modern open pit mine. The company filed a plan for restoration and development of the site with authorities in September 2016.
“Midas Gold’s Stibnite Gold project in Idaho offers a compelling investment proposition, with low geopolitical risk, potential for production of over 300,000 ounces of gold per year at competitive operating costs, and exploration upside,” Kelvin Dushnisky, president of Barrick, said.
The deal comes after Barrick last month cancelled further work on its ambitious Pascua-Lama gold project that straddles the border or Chile and Argentina in the Andes mountains.
Barrick paid C$1.06 per share for the stake in Midas Gold, which also gives it the right to appoint one director and participate in any future equity raises to maintain its holding.
Midas Gold will use the proceeds from Barrick to complete a feasibility study on the Stibnite project and secure permits for the project, it said.
Mining first began on the Stibnite site in 1899 during the Thunder Mountain Gold Rush.
Source: FT.com
