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Victoria Gold (TSXV: GCX) is acquiring all of Sabre Gold Mines‘ (TSX: SGLD) assets located in the Yukon, which include the former-producing Brewery Creek mine as well as the Gold Dome and Grew Creek exploration properties.
Under an agreement sealed Thursday, Victoria will acquire Sabre’s Yukon-based subsidiary, Golden Predator Mining, for C$13.5 million. Victoria will initially pay C$8.5 million, comprising C$1.5 million in cash and C$7 million in cash or shares at its choosing. The remainder will be paid in cash and possibly shares in two annual instalments.
“With the acquisition of Sabre’s Yukon assets, we are pleased to be expanding our footprint and asset base in our own backyard. With our track record of exploration, permitting, development and operations in Yukon, we believe we can add value to this portfolio of assets,” John McConnell, president and CEO of Victoria, said in a news release.
Victoria Gold has been on the hunt for projects this year. It made an unsuccessful play to acquire Atac Resources in February. The Yukon gold explorer was instead bought by Hecla Mining (NYSE: HL) in a deal valued at C$39 million.
Brewery Creek, the main asset under Golden Predator’s portfolio, is a heap leach project covering 181 sq. km. located 55 km east of Dawson City. It is situated 120 km west of Victoria’s Eagle gold mine, the territory’s only currently operating hard rock mine.
Brewery Creek hosts measured and indicated resources of 34.5 million tonnes grading 1.03 grams gold per tonne for 1.1 million contained ounces. Inferred resources add another 36 million tonnes grading 0.88 gram gold for 1 million ounces.
A January 2022 preliminary economic assessment for Brewery Creek outlined an after-tax net present value of $112 million with an internal rate of return of 27.6%. The initial capital was estimated at $105 million and its payback period at 2.6 years.
The purchase also includes the Gold Dome property, which covers 95 sq. km. and is located 25 km west of the village of Mayo, Yukon, as well as the 135-sq.-km Grew Creek property located on the Robert Campbell highway, 6 km west of Ross River.
