The Canadian unit of Placer Dome (TSE) is expanding the Dome gold mine in Timmins, Ont., by purchasing the adjacent Preston property.
The company has reached an agreement with Patrick Sheridan to acquire the property, which was in production between 1936 and 1966.
Sheridan will receive $10 million over eight years plus a 2% net smelter royalty (NSR) on the first 1 million oz. produced from Preston and a 3% NSR on subsequent gold output. The surface facilities, equipment and tailings system are not part of the deal.
The agreement is subject to due diligence and approval by Placer’s board of directors.
The Dome mine, in operation since 1910, is undergoing an expansion that will boost annual output to 315,000 oz. during the second quarter from the current 187,000 oz.
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