Agnico Eagle Mines (TSX:AEM) is investing over C$57 million ($57.6 million) in Radisson Mining Resources (TSX-V:RDS), giving Canada’s largest gold producer exposure to another exploration asset in Québec’s prolific Abitibi region.
Under a subscription agreement, Agnico has agreed to acquire approximately 53.42 million Radisson units at C$1.07 each.
Each unit comprises one Class A common share and half of a common share purchase warrant. Each whole warrant will be exercisable at C$1.39 per share for 60 months.
Upon completion of the investment, Agnico will own approximately 10.45% of Radisson on a non-diluted basis and 14.90% on a partially diluted basis.
Reviving historic mine
Radisson plans to use the proceeds to launch an advanced underground exploration program at its flagship O’Brien Gold Project in Québec’s Abitibi region.
O’Brien hosts a historic mine that produced 587,000 ounces of gold at an average grade of 15.25 grams per tonne between 1926 and 1957, making it one of the region’s highest-grade producers at the time.
Radisson is now looking to establish a new chapter for the former mine through a low-capex, small-footprint development strategy based on offsite milling and access to established infrastructure.
The planned underground program will include development of an access ramp, underground and surface mine infrastructure, and water management facilities.
Radisson CEO Matt Manson says Agnico’s investment will allow the company to establish “the first modern underground access at O’Brien”.
“The advanced underground exploration program that will now commence is designed to extend our understanding of potential mining conditions at O’Brien,” Manson says.
“It also establishes a development schedule for O’Brien. As this underground work advances, our ongoing 140,000-metre surface drill program of exploration step-outs will continue as planned, funded from our existing cash resources.”
More Abitibi exposure
For Agnico, the investment adds to its extensive presence in the Abitibi region, where it already operates the LaRonde, Canadian Malartic, and Goldex mines.
It also adds Radisson to a growing portfolio of investments in Canadian gold explorers.
Last month, Agnico invested C$60 million in newly listed Cadillac Mines (TSX:CADY), which also holds projects in the Abitibi region.
The gold major has also built stakes in companies including Wallbridge Mining (TSX:WM), Maple Gold Mines (TSX-V:MGM), and Cascadia Minerals (TSX-V:CAM), extending its exposure to exploration opportunities across Canada.
Radisson is a gold exploration company focused on its 100%-owned O’Brien Gold Project, located in the Bousquet-Cadillac mining camp along the Larder-Lake-Cadillac Break in Abitibi, Québec.
Write to Jackson Chen at Mining.com.au
Image: Radisson Mining
