Alamos Gold will acquire all issued and outstanding shares of Carlisle Goldfields in a deal valued at $22.1 million, excluding Alamos’ existing 19.9% ownership of Carlisle. Carlisle’s primary asset is the Lynn Lake gold project located in Manitoba, Canada, which consists of five near-surface deposits, containing total measured and indicated mineral resources of 40.5 million metric tons (mt) grading 2.11 g/mt for 2.75 million oz of gold and total inferred mineral resources of 51.8 million mt grading 1.37 g/mt for 2.28 million oz.

In February 2014, a positive preliminary economic assessment (PEA) was completed on the two primary deposits, the MacLellan mine and the Farley Lake mine, which detailed average annual production of 145,000 oz of gold at all-in sustaining costs of C$644/oz over a 12-year mine life. The PEA outlined attractive economics with an after-tax internal rate of return (IRR) of 26%, assuming a gold price of $1,100/oz.

As part of the November 2014 agreement with Carlisle, AuRico Gold (a predecessor to Alamos) acquired a 19.9% interest in Carlisle and a 25% interest in the Lynn Lake project with an option to earn up to a 60% interest in the project by spending C$20 million and delivering a definitive feasibility study on the project within a three-year period.

“The Lynn Lake project represents an attractive, low-risk growth opportunity as a high-grade, open-pit project located in one of the best mining jurisdictions in the world,” said John A. McCluskey, president and CEO of Alamos. “Given its potential for strong economics, the structure of the existing earn-in agreement and our commitment to advancing Lynn Lake, we are pleased to be able to consolidate our ownership of the project through our acquisition of Carlisle. This is a win for shareholders on both sides.”

Alamos is a Canadian-based intermediate gold producer with diversified production from three operating mines in North America. This includes the Young-Davidson mine in northern Ontario, Canada, and the Mulatos and El Chanate mines in Sonora State, Mexico. Additionally, the company has development stage projects in Mexico, Turkey, Canada and the United States.