North America’s precious metals producer McEwen Mining Inc. (TSX: MUX) will soon have a sizable portfolio of gold assets in Nevada.
This will be made possible by acquiring Timberline Resources Corporation (TSX-V: TBR) (OTCQB: TLRS). A definitive agreement was reached for the acquisition early this week.
McEwen will receive three projects in central Nevada: Paiute, Eureka and Seven Troughs.
Paiute, situated on the Battle Mountain trend, is jointly owned by Nevada Gold Mines. Timberline operates the joint venture. Eureka, also on that trend, holds over 420,000 ounces of measured and indicated gold.
Seven Troughs, located west of the other two between the Battle Mountain and Walker Lane trends, has yielded some of the highest gold production grades in Nevada history — Timberline claims.
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A 162 per cent premium
McEwen currently holds a 3.3 per cent stake in Timberline but now wants the whole pie. The upcoming acquisition is valued at approximately C$26 million.
The deal represents a 162 per cent premium based on Monday’s closing price and 132 per cent based on the past 20 days, Timberline says. McEwen currently has only one gold project in Nevada: Gold Bar.
When the transaction will close has not been specified. Timberline will have to pay McEwen a US$400,000 termination fee if it bails on their agreement.
“The merger with McEwen Mining, at an attractive premium to Timberline’s current trading price, provides our shareholders with continued exposure to Timberline’s assets as part of a more diverse growth-oriented platform,” Timberline President Patrick Highsmith said.
McEwen acquiring Timberline $TBR.V in an all-share deal valued at US$0.102 per share (132% premium)
Only $NPR.V and $GLM.V left between i80 and McEwenhttps://t.co/W2GIDTWHPc pic.twitter.com/qak4XvXL38
— Mining Catalyst (@MiningCatalyst) April 16, 2024
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Production accelerates at nearby mines
The international operator Calibre Mining Corp. (TSX: CXB) (OTCQX: CXBMF) will commence production at its Gold Rock project this year and next. It is a development-stage heap leach opportunity on the Battle Mountain trend containing over 400,000 ounces of measured and indicated resources.
Calibre just closed a C$115 million financing, which will help advance its activities in Nevada.
Furthermore, production at the Goldrush mine within the Nevada Gold Mines Cortez Complex will be ramping up this year. The Eureka County operation is expected to produce about 130,000 ounces throughout 2024.
Nevada currently has 23 major gold mines that collectively produce about 5 million ounces per annum. If the state were a country, it would be the world’s fourth-largest gold-producing nation.
It produced 158 million ounces of the yellow metal between 1835 and 2016.
Calibre Mining is a sponsor of Mugglehead news coverage
rowan@mugglehead.com
