Calibre Mining Corp. (TSX: CXB) (OTCQX: CXBMF) expects to close its merger with Marathon Gold Corp. (TSX: MOZ) in January next year. Calibre’s corporate development manager, Ryan King, described the deal as a “tremendous opportunity” in a recent interview with Commodity-TV.
The mill at Marathon’s flagship Valentine gold project should be commissioned by Q4 next year, and Calibre aims to enter commercial production at the site by the end of 2025. The combined company will become a half million ounce per year producer once the Newfoundland site is fully developed.
“It’s getting through that process of completion, mill commissioning next year and then being in position to be pouring gold in the first half of 2025,” King said in the interview Tuesday. Valentine will soon become Atlantic Canada’s largest gold mine. The mill will have a capacity of 4 million tonnes per annum.
The all stock transaction valued at C$345 million is expected to create a company with a strong annual cash flow of C$508.4 million. Calibre will hold a 66 per cent stake in the combined company and Marathon will possess the remainder.
“That gets us to that 500,000 ounces a year mark with our operations in Central America, Nevada, and Newfoundland,” King said.
Read more: Calibre Mining joins Mining Association of Canada
Closing the deal with Marathon is Calibre’s top priority
Marathon has completed approximately 50 per cent of the necessary construction at the Valentine project.
King says closing the merger deal is currently Calibre’s number one priority.
“They are doing everything that they promised they would do and they are really over fulfilling,” Jochen Staiger from Commodity-TV, a Calibre shareholder, said. “They have over $100 million in the bank.”
“This is exactly how you make a business successful; it’s a fantastic company, and their share price is way too low.”
Calibre sold 73,241 ounces in Q3 this year, representing its fourth consecutive quarterly record in gold sales. The company’s share price has risen by over 52 per cent in the past year and multiple financial firms have predicted it will continue to rise.
Calibre joined the Mining Association of Canada earlier this month and will cooperate with the organization to refine and enhance its mining and business practices.
The Valentine project is estimated to contain 4 million ounces of measured and indicated gold. As of October, Marathon had spent C$190 million on the project.
Progress being made at the surface of the Valentine project’s Leprechaun deposit last December. Photo via Marathon Gold
Calibre Mining is a sponsor of Mugglehead news coverage
rowan@mugglehead.com
