Canada's TDG Gold Signs C$110 Million Mining Deal with Freeport-McMoRan of the United States

en.Wedoany.com Reported - On November 12, Canadian mineral exploration company TDG Gold Corp. signed a binding joint venture implementation and share purchase agreement with Freeport-McMoRan Mineral Properties Canada Inc., a subsidiary of the U.S.-based Freeport-McMoRan Inc. Under the agreement, the latter will pay C$110 million in cash to acquire a 51% initial interest in the Aurora West project in the Toodoggone mining district of British Columbia, Canada. Upon completion of the transaction, TDG Gold will retain a 49% interest, and the project will be jointly held and managed by both parties through a joint venture company.

Prior to the implementation of the transaction, TDG Gold will restructure the project assets, transferring the Aurora West mineral claims and related interests into two newly established British Columbia companies. One company will hold two designated mineral claims within the project, while the other will hold the remaining mineral claims. Following the completion of the asset restructuring and the satisfaction of relevant closing conditions, Freeport-McMoRan will acquire 51% of the shares of each of the two companies, with TDG Gold retaining 49% of each.

The agreement also includes subsequent earn-in arrangements. Freeport-McMoRan may further increase its project interest through additional exploration investment and cash payments: on the one hand, by solely funding an additional C$80 million in exploration expenditures, it can increase its interest in the Aurora West joint venture from 51% to 75%; on the other hand, by paying C$40 million to acquire the remaining 49% equity interest held by TDG Gold in the other mineral claims company, thereby obtaining 100% interest in that company.

Under the above additional investment arrangements, Freeport-McMoRan has committed to investing C$30 million within three years after the completion of the transaction, including at least C$15 million in the first two years. During the additional investment period, TDG Gold will not be obligated to contribute funding to the joint venture. If Freeport-McMoRan ultimately exercises its earn-in rights, TDG Gold will retain a 25% interest in the project's main joint venture company and hold a 2% net smelter return royalty on two designated mineral claims of the other company.

This transaction does not involve TDG Gold's Shasta gold-silver project and Baker mining district, which will remain with the company. TDG Gold stated that the proceeds from the transaction will be used to strengthen its cash reserves and support subsequent exploration and development of the Shasta project. The parties will also sign a shareholders' agreement and a road use agreement to clarify joint venture governance, funding arrangements, and project road access conditions. As some mineral claims of the project require access via roads crossing the mineral claims area retained by TDG Gold, the road use agreement will provide corresponding access arrangements for the joint venture project.

The transaction remains subject to customary closing conditions, including approval by the TSX Venture Exchange and applicable regulatory approvals. The asset restructuring is expected to be completed by December 2026, and the formal closing is expected to occur within five business days after the relevant conditions are satisfied or waived.