Taseko Mines Limited (TSX: TKO) (NYSE MKT: TGB) (LSE: TKO) is pleased to announce that it has entered into an agreement to sell the Harmony Gold Project to JDS Gold Inc. a newly incorporated company controlled by JDS Energy & Mining Inc. and affiliates. Under the terms of the agreement, JDS will become the owner and operator of the Harmony Gold Project, a high-grade development-stage gold project located on Graham Island in Haida Gwaii.
Taseko will retain a 15% carried interest in JDS and a 2% net smelter return royalty on the Project. Taseko also has the right to terminate the agreement and revert to 100% ownership of Harmony in the event JDS does not achieve certain project development milestones and an IPO or other liquidity event within an agreed timeframe. Closing of the transaction remains subject to customary terms and conditions.
Stuart McDonald, President and CEO of Taseko, commented, “We are continually looking for ways to create shareholder value from our extensive pipeline of high-quality development projects. With Florence Copper expected to commence construction later this year and our large-scale Yellowhead Copper project preparing to enter the environmental assessment process, we did not expect to be in a position to advance Harmony for a number of years. JDS Energy & Mining Inc. has a proven track record of developing mineral projects, and this transaction structure allows Taseko to participate in their success and create value from this asset in the near-term.”
Jeff Stibbard, CEO of JDS Energy & Mining Inc., stated, “As a mining development company, we are always in search of high-quality projects in safe jurisdictions, particularly in Canada. Harmony, which had been in Taseko’s inventory for two decades, is a mining project which fits very well within the JDS group. With our engineering, permitting and mine construction expertise, we believe we can advance this project and create significant value for all stakeholders.”
About Harmony Gold Project
The Harmony Gold Project is located on Graham Island in Haida Gwaii, off the west coast of British Columbia, Canada. The project comprises of 58 mineral claims covering 177 square km. Previous owners of the Project have carried out over 80,000 meters of drilling in 543 holes. Taseko purchased the project in late 2001 and advanced engineering work until 2008, when the Company focused efforts on its Gibraltar Mine. The project has a historical resource estimate containing over 3 million ounces of gold within 22 million tonnes of measured and 42 million tonnes of indicated resources grading 1.77 and 1.41 g/t gold respectively at a 0.60 g/t gold cut-off grade. This historical resource was estimated by M. Nowak, P.Eng. in 1997 using multiple indicator kriging and classified in 2001 as described by Nowak et al. in a February 2001 Misty Mountain Gold Ltd. report entitled “Resource Estimate for the Specogna Gold Deposit”. A qualified person has not done sufficient work to classify the historical estimate as a current mineral resource and the Company is not treating the historical estimate as a current mineral resource. A qualified person would be required to review the historical estimate and make recommendations in order to upgrade or verify it as a current mineral resource.
About JDS Energy & Mining
JDS Energy & Mining Inc. was founded in 2004 by President and CEO, Jeff Stibbard. The team is comprised of a diverse set of skilled and highly experienced resource sector professionals with a proven track record delivering and executing project plans on budget, on time, and most importantly, safely with no harm to people, environment, assets, or reputation. JDS is focused on maintaining a social license to operate, globally, and prides itself on delivering fit-for-purpose project concepts from inception to full operations – a process it has executed seamlessly for operations throughout Canada and the world, including the Minto Mine in the Yukon, the Gahcho Kue Mine located in the Northwest Territories, the Silvertip Mine in northern British Columbia, Victoria Gold’s Eagle Gold Mine in the Yukon, and most recently, the PureGold Mine in Red Lake Ont.
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We acknowledge the [financial] support of the Government of Canada.