2022-04-04
Subject to a successful earn-in, the two companies will form a joint venture corporation owned 80% by Barrick and 20% by Hemlo Explorers.
If any party’s interest in the JV declines below 10%, it will convert to a 1% net smelter return royalty.
Both companies said they will work to complete the due diligence necessary to sign a definitive agreement by month-end.
The Pic project comprises 910 claims over 16,800 hectares in the Hemlo-Schreiber Greenstone Belt. The Hemlo Camp is noted for hosting the Hemlo deposit, with more than 22 million oz of historical production since 1985. It remains in operation at the Williams mine operated by Barrick.
The Pic project is said to host multiple intrusive related gold shear systems with significant occurrences at Wire Lake and Smoke Lake-Beggs Stock. Further, Porphyry, Contact and Page Lakes represent prospective areas showing litho-geochem and soil sample anomalies with concurrent geophysical features favourable for gold mineralization.
For the 2022 field season, Hemlo Explorers will focus its exploration efforts on the area in the southwestern corner of the Pic project called Project Idaho. The company believes that the structural, geophysical and geological setting of Project Idaho resembles Generation Mining’s (TSX: GENM) Marathon palladium-copper project 3 kilometres to the west, which is now under development.
Hemlo Explorers shares continued to trade at elevated levels in the early afternoon at 19.5c per share, which gives the junior a market capitalization of C$6.82 million ($5.46m). The company’s equity had lost 58% of its value over the past 12 months.
Barrick is making good on CEO Mark Bristow stating that Canada remains a strategic cornerstone jurisdiction for the gold major, despite its only Canadian operation, Hemlo, falling outside its so-called Tier One asset strategy. Barrick defines a Tier One mine as one that produces in excess of 500,000 oz. of gold per annum and has a life of at least 10 years.
After hitting a recent 12-month high at C$33.50, Barrick’s Toronto-listed equity is still trading up more than 20% at C$30.77, giving it a market capitalization of C$54.77 billion ($43.8bn).