Canadian gold developer First Mining has entered into a partnership with Big Ridge Gold Corp to advance its Hope Brook Gold Project located in Newfoundland, Canada.
Under the agreement, Big Ridge can earn an 80% interest in the Project through a two-stage earn-in over five years by incurring a total of $20 million in qualifying expenditures, issuing up to 36.5 million of its shares and making a cash payment to First Mining.
The agreement will see First Mining retain a 1.5% net smelter returns (NSR) royalty on the Project, of which 0.5% can be bought back by Big Ridge for $2 million.
Additionally, First Mining will have the right to nominate one member to the Board of Directors of Big Ridge on closing, after which the company will be entitled to have one of its nominees on the Big Ridge Board for as long as it owns at least 10% of the issued and outstanding shares of Big Ridge.
First Mining’s CEO Dan Wilton said the company was ‘extremely pleased’ to announce the partnership to advance its Hope Brook project, located in one of the most exciting exploration regions in the gold industry.
“The team at Big Ridge brings a unique combination of complementary experiences and skill sets to Hope Brook, including a strong understanding of the operating environment in Newfoundland, robust exploration, development and operational expertise, and deep capital markets experience and relationships,” he continued.
“We are excited to work with Big Ridge as they unlock value in Hope Brook and the surrounding highly prospective land package.
“First Mining shareholders will retain significant exposure to Hope Brook through an initial 19% equity stake in Big Ridge, a retained 20% project interest at Hope Brook, milestone share and cash payments and an NSR royalty on the Project.”