B2Gold Corp. (TSX: BTO) (NYSE American: BTG) (NSX: B2G) has chosen to invest in the Yukon Territory-focused miner Snowline Gold Corp. (CSE: SGD) (OTCQB: SNWGF) through a strategic non-brokered flow-through private placement.
Snowline announced the arrangement on Tuesday and will be providing B2Gold with up to 3,941,048 flow-through common shares of the company for $4.86 per share. Aggregate proceeds of up to around $19.2 million will go to Snowline through the new agreement.
Proceeds from B2Gold’s investment will be used to fund Snowline’s several exploration endeavours in the Yukon. B2Gold also recently purchased three million shares of Snowline on the open market and will own approximately five per cent of the northern miner’s issued and outstanding shares upon closing of the deal at the end of this month.
“A flow-through share is a type of common share that permits the initial purchaser to claim a tax deduction equal to the amount invested. The flow-through share regime allows public companies to transfer to investors certain exploration expenditures conducted on Canadian soil,” says the Prospectors & Developers Association of Canada.
The PDAC also says that flow-through share financing accounts for more than 65 per cent of funds raised on stock exchanges in Canada for national exploration, generating significant mining industry activity within the country.
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B2Gold believes Snowline’s 2021 Valley discovery was significant for Canada’s mining sector
The offering or transaction will be closing on March 28 and will be required to adhere to certain conditions. A receipt of acceptance from the Canadian Securities Exchange will be one of these requirements.
“We are excited to welcome B2Gold as a growth-focused, long-term, value-driven investor,” said Scott Berdahl, Director and CEO of Snowline Gold.
“We’d like to commend the Snowline exploration and management teams for their strong exploration work conducted thus far across their large mineral tenure in the Selwyn Basin. Their highly prospective land portfolio boasts district-scale, untapped greenfield potential, and we believe their Valley discovery to be one of the more significant discoveries in Canada in recent history,” added Clive Johnson, President and CEO of B2Gold.
Snowline recently drilled a hole deeper than the height of Toronto’s CN Tower at the Valley zone of its Rogue project in the eastern part of the Yukon bordering the Northwest Territories.
For those who attended PDAC last week, you likely had a look up at the CN Tower. One of our final drill holes, hole 29 at Valley exceeded the height of the CN Tower, which stands at 553.3 m tall. Here’s our team taking it all in.
Read the full release: https://t.co/cNgGdcj3ww pic.twitter.com/YZtKUtVMQu
— Snowline Gold (CSE:SGD)(OTC:SNWGF) (@SnowlineGold) March 13, 2023
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Yukon mining contributed more than $300 million to the territory’s economy in 2019, according to the Yukon Chamber of Mines.
Other gold producers operating in the territory include Banyan Gold Corp. (TSX-V: BYN) (OTCQB: BYAGF) and Victoria Gold Corp. (TSX: VGCX) — which owns the territory’s largest gold mining operation, the Eagle Mine.
B2Gold’s stock value rose by 0.31 per cent on Wednesday to $4.82 on the Toronto Stock Exchange.
Snowline’s stock price dropped by five per cent to $2.84 on the Canadian Securities Exchange.