Alamos Gold Inc. reported that it has closed the acquisition of 100% of the Agi Dagi and Kirazli gold projects through the purchase of certain Turkish subsidiaries held by Fronteer Development Group. Agi Dagi and Kirazli are advanced-stage gold exploration projects located in the Biga Peninsula of northwestern Turkey.
Alamos said it paid $40 million cash and issued an aggregate of 4 million Alamos common shares to Teck and Fronteer in consideration for acquiring the projects. In addition to statutory compensation that may apply to the projects, a third party has a 2% Net Smelter Return Royalty on production from the Agi Dagi project.
In 2010, Alamos expects to spend approximately $12.8 million in Turkey on development and exploration activities related to Kirazli and the Deli, Baba, and Camyurt zones at Agi Dagi. The company intends to drill 34,000 m at a cost of $6.8 million, while the 2010 development budget of $6 million is related primarily to the completion of a scoping study in 1Q 2010, environmental impact assessments, initiation of a pre-feasibility study, and other expenditures related to establishing operations in Turkey.