(RTTNews) - Osisko Mining Inc. (OSK), a mineral exploration company on Tuesday announced it has concluded a 50/50 joint venture agreement with a subsidiary of South Africa-based Gold Fields Limited (GFI), a gold producer for the joint ownership and development of Osisko's Windfall gold project, located in the Abitibi region of Québec, Canada.
Gold Fields' initial cash payment to Osisko on signing is C$300 million. An additional deferred cash payment of C$300 million would be made to Osisko on issuance of the applicable permits authorizing the construction, operation and mining of the Windfall Project.
In addition to the above, Gold Fields would make two additional separate C$17 million cash payments to Osisko, the first on July 31, 2023 and the second on December 31, 2023. The C$34 million in total represents reimbursement of items already incurred by Osisko as part of pre-construction spend.
Gold Fields would solely fund expenditures for regional exploration up to a maximum of C$75 million, after which regional exploration programs would be proportionately funded by each of Osisko and Gold Fields.
Gold Fields and Osisko have to share all pre-construction costs, provisionally budget estimated at C$250 million and construction costs i.e. feasibility capital expenditure estimated at C$789 million on a 50/50 basis going forward.
Gold Fields' acquisition cost, exploration commitment, and contribution to pre-construction and project capital would ultimately represent an investment of C$1.2 billion to acquire its interest, bring Windfall into production and further unlock the regional exploration upside.
The transaction closed on May 2, 2023, with Gold Fields acquiring a 50% partnership interest in the "Windfall Mining Group", a partnership formed under the laws of the Province of Ontario, which would develop the Windfall project and the surrounding Urban Barry and Quévillon exploration properties.
Pursuant to the terms of the Framework Agreement, Gold Fields acquired 50% interest in the Partnership for an aggregate consideration of C$600 million in cash to Osisko.
Maxit Capital LP acted as financial advisor to Osisko and Bennett Jones LLP acted as Osisko's legal counsel.
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