Agnico Eagle to acquire Ontario gold properties from Canadian Malartic partnership

Joint venture mining partners Agnico Eagle and Yamana Gold have cut a deal to sever off two large gold exploration properties in Northern Ontario.

In a US$162-million cash deal, Yamana has agreed to give up its 50 per cent interest in the exploration properties of Canadian Malartic Corporation (CMC), an equal partnership it created with Agnico Eagle in 2014.

The biggest assets in the deal are the Kirkland Lake project in northeastern Ontario and the Hammond Reef Gold project, outside of Atikokan in northwestern Ontario.

In a Dec. 21 news release, Agnico said this doesn't affect the Canadian Malartic Mine in Quebec and related assets including Odyssey, East Malartic, Midway, and East Amphi, which will continue to be jointly owned and operated by Agnico and Yamana.

"The purchase of the CMC asset portfolio enhances our longer-term development pipeline, and provides us with potential production growth post our current mine buildout in Nunavut," said Sean Boyd, Agnico Eagle CEO in a statement.

"The Kirkland Lake property package enhances our current mineral reserves and offers near-term exploration upside, while the Hammond Reef project provides good optionality to a potential rise in the gold price," he added.

The transaction is expected to close on March 31.

The 27,300-hectare Kirkland Lake project contains the deposits of the Upper Beaver, Anoki and McBean, Amalgamated Kirkland (AK) and Upper Canada.

Hammond Reef, 23 kilometres northeast of Atikokan, is an advanced stage gold project covering 31,145 hectares in northwestern Ontario. The project contains well defined mineral resources.