Newmont Mining announced its plans to acquire a 50% interest in the Galore Creek Partnership (GCP) from NOVAGOLD Resources, and to form a partnership with Teck Resources, who owns the remaining stake. Galore Creek, located in British Columbia, is one of the largest undeveloped copper-gold projects with resources previously reported by Teck of 8 million ounces (oz) of gold and 9 billion lb of copper.
The NOVAGOLD agreement encompasses a staged and contingent investment of $275 million, with an initial payment of $100 million; a payment of $75 million either after the completion of a prefeasibility study or three years from closing; and a payment of $25 million either after the completion of a prefeasibility study or five years from closing. A final $75 million payment would be contingent on a final decision to develop the project.
“Galore Creek holds the potential to support decades of profitable copper and gold production in a favorable mining jurisdiction, in line with our strategy to create long-term value for our stakeholders,” said Gary Goldberg, president and CEO, Newmont Mining. “Partnering with Teck allows us to bring both organizations’ considerable technical, financial and sustainability strengths to bear in evaluating and refining development plans for Galore Creek, and to build on the strong relationships Teck has established with the Tahltan First Nation and British Columbia.”
Newmont and Teck will define the scope, budget, and timeline for prefeasibility studies over the next several months and expect the prefeasibility studies to be completed over three to four years with an annual budget of $10 million to $15 million (50% basis). GCP will be governed by a management committee comprised of leaders from Newmont and Teck and managed by a GCP study director and team, supported by Newmont and Teck subject matter experts.