Agnico-Eagle Mines and Comaplex Minerals agreed in early April 2010 to a transaction whereby Agnico will acquire 100% of Comaplex and then spin off a new company to Comaplex shareholders that will hold all Comaplex assets except its Meliadine gold property in Nunavut, Canada. Agnico-Eagle currently owns about 12.3% of Comaplex’s outstanding shares. Total cost to Agnico-Eagle will be about C$650 million. The transaction, which is subject to regulatory and Comaplex shareholder approval, was expected to close in June 2010.
The Meliadine land package encompasses more than 65,000 ha (160,600 acres) and stretches east-west more than 80 km. The center of the property is located about 24 km north of the town of Rankin Inlet on the northwest coast of Hudson Bay. Agnico-Eagle’s new Meadowbank mine is located about 300 km to the northwest.
Current Meliadine resources in five deposits total 3.29 million oz of gold in 12.9 million mt grading 7.9 g/mt measured and indicated and 1.73 million oz in 8.4 million mt grading 6.4 g/mt inferred. Commenting on the transaction in a conference call, Agnico-Eagle Vice Chairman and CEO Sean Boyd said the company was giving up about 5.6% of its value to increase its resources by 17%.
Agnico-Eagle’s first priority at Meliadine will be a stepped-up exploration program, including drilling of a minimum of 100,000 m over the next two years. An underground exploration program is being considered, including a production-sized ramp. In addition to a primary objective of converting resources to reserves, the exploration program will also give attention to 24 regional exploration targets Agnico-Eagle thinks should be drilled. The company expects to begin a feasibility study by the end of 2011.
Comaplex has completed a preliminary economic assessment of potential mine development at Meliadine based on an assumed mine production rate of 3,000 mt/d. Agnico-Eagle is proceeding on the assumption it will develop a larger project, producing up to 7,000 mt/d; however, Boyd emphasized, it is still early days, and decisions regarding project size and design will depend on exploration outcomes.