Tudor hikes ownership of Treaty Creek in BC

Tudor Gold (TSXV: TUD) has agreed to acquire American Creek Resources (TSXV: AMK; US-OTC: ACKRF) in an all-share deal that would increase its interest to 80% from 60% in the Treaty Creek project in northwest British Columbia.

Under a letter of intent signed last week, Tudor is to acquire American Creek by issuing shares on a 0.238-for-one basis. Based on spot prices, the deal represents a premium of 40%. Following completion of the merger, American Creek shareholders would own about 30% of the combined company. Teuton Resources (TSXV: TUO) will continue to hold 20% of Treaty Creek. 

Treaty Creek, in the province’s Golden Triangle about 250 km northeast of Prince Rupert, is regarded as among the largest gold discoveries in the last 30 years. Its Goldstorm deposit hosts 730 million indicated tonnes grading 0.92 gram gold per tonne, 5.48 grams silver per tonne and 0.18% copper (1.19 grams gold-equivalent per tonne) and another 150 million inferred tonnes averaging 1.01 grams gold, 6.02 grams silver and 0.15% copper (1.25 grams gold-equivalent.)

American Creek’s shares climbed 9.1% to 12¢ apiece on Tuesday afternoon in Toronto, with a market capitalization of about $52 million. Tudor fell 1.8% to 54¢ apiece, giving it a $137-million market value.

‘Reasonable cost’

“Our acquisition of American Creek cements our interest in the Treaty Creek project, which hosts one of the largest gold discoveries in Canada with excellent potential for expansion and additional gold-copper discoveries, at a reasonable per ounce of gold equivalent cost,” Joe Ovsenek, CEO of Tudor Gold, stated in a news release.

“Operating costs will be more efficient and Tudor will be better positioned to secure future exploration and development capital,” American Creek’s CEO Darren Blaney added.

Treaty Creek’s large gold-copper porphyry system sits alongside several other mineralized zones across a 179-sq.-km land package. The property borders Seabridge Gold’s (TSX: SEA; NYSE: SA) KSM — the world’s largest undeveloped gold-copper project — to the southwest and Newmont’s (TSX: NGT; NYSE: NEM) Brucejack mine to the southeast. 

Before Tudor’s involvement in the project, Treaty Creek already had a rich exploration history that can be traced back to the late 1920s. Still, complete records of exploration activity can only be found for the 80s, when Teuton, led by Ed Kruchkowski, staked the claims and made several discoveries through option agreements. Tudor took on the project in 2016 to follow up on prior work by American Creek, leading to the Goldstorm discovery that year.