An affiliate of the Orion Mine Finance Group has agreed to buy 50% of the Greenstone Gold Mines (GGM) partnership, which owns the Hardrock project, for $225-million plus contingencies of about $75-million, part owner Premier Gold Mines announced on Tuesday.
Orion would buy Toronto-listed Centerra’s 50% of the GGM with Premier holding the other share.
Earlier this year, Centerra turned down Premier’s $205-million offer for its interest in the GGM. At the time, Premier said that it needed a partner with the financial muscle to take the C$1.25-billion Hardrock project through to production.
Premier and Centerra have locked horns over the development-stage project. According to the Northern Miner, Centerra has accused Premier of inflating an October 2019 mineral resource and asking for a declaration that it should not be considered a feasibility study.
Premier said on Tuesday that Orion had indicated that it would support a positive feasibility decision for the Hardrock project “based on the feasibility study conducted in 2019”.
“This transaction paves the way for the development of Premier’s flagship asset. We look forward to working with Orion, a long-standing supportive partner of Premier, in advancing the Hardrock project on an expedited timeline,” stated Premier president and CEO Ewan Downie.
Located on the Trans-Canada Highway near Geraldton, Ontario, the Hardrock project represents one of the most significant large-scale, permitted, mine development opportunities in North America.
The 2019 mineral resource update increased the total measured and indicated resources by 11% on the 2016 estimate to 7.01-million ounces. The measured and indicated resources restricted to openpit potential of 5.87-million ounces of gold including an initial 237 000 oz in the measured category.
The 2016 feasibility study proposed a mine with average production of 288 000 oz/y.
Istvan Zollei, portfolio manager at Orion, commented: “Orion looks forward to being a partner in turning the Hardrock Project into Ontario’s next prominent mine. After years of successful exploration and development work, we believe the Greenstone project has the potential to grow into a large, long-lived gold mining operation with multiple deposits.”