GoGold Resources plans to sell interest in Santa Gertrudis gold project, located in Sonora, Mexico, to Agnico Eagle Mines Ltd. for $80 million in cash (minus an estimated working capital adjustment of $280,000 at the close of the transaction). GoGold will retain a 2% net smelter return on the project. While Agnico will have the option to buy 1% of the royalty for $7.5 million.
“We believe that this transaction demonstrates the value generated and the progress achieved in Santa Gertrudis by the GoGold team since we acquired the project in 2014,” said Brad Langille, president and CEO of GoGold. “Agnico Eagle has a solid track record in advancing and developing projects.”
The executive also said the transaction will allow the company to significantly strengthen its balance sheet by reimbursing a revolving credit line, advancing the Parral tailings project to its full potential, and continuing to seek opportunities in Mexico and beyond.