Newcrest Mining is set to purchase the GJ copper-gold property in British Columbia from Vancouver-based Skeena Resources for $C7.5 million ($8.37 million) in cash.
The 43,500-hectare property consists of 93 contiguous mineral claims located around 30 kilometres west of Newcrest’s Red Chris mine in the Golden Triangle of northwest British Columbia.
Skeena projected that copper would generate around two-thirds of the project revenue during GJ’s initial five years of production.
Under the sale agreement, Newcrest will be required to pay royalties on the GJ Property.
“Advancing the Eskay Creek project is Skeena’s primary focus. Therefore, we are divesting the GJ Property … as a way to raise funds for Eskay while incurring the least amount of equity dilution possible to our shareholders,” Skeena chief executive Walter Coles said.
Skeena acquired the Eskay Creek property from Barrick Gold in December 2017, which according to the British Columbian Ministry of Energy, Mines and Petroleum Resources was once the world’s highest-grade gold mine by volume.
The Canadian junior also sold its subsidiary Sona Resources, including the Blackdome-Elizabeth property in British Columbia, to Perth-based exploration company Tempus Resources for $C500,000.
Australian companies have been proven to seek new mining ventures in North America, with St Barbara acquiring Canadian miner Atlantic Gold and Newcrest also taking over the Red Chris mine from Imperial Metals last year.