TORONTO — Osisko Mining Inc. has signed a deal to form a 50-50 joint venture with South African company Gold Fields Ltd. to develop the Windfall gold project in Quebec.
Under the agreement, Gold Fields will make a $300-million initial cash payment to Osisko plus an additional payment of $300 million on issuance of the applicable permits authorizing the construction, operation and mining of the project.
Gold Fields will also fund spending for regional exploration up to a maximum of $75 million, after which regional exploration programs would be proportionately funded by each company.
In addition, Gold Fields will make two additional payments of $17 million for reimbursement of money already spent by Osisko on pre-construction expenses.
Osisko chairman and chief executive John Burzynski says the partnership strengthens the company’s balance sheet, allows it to significantly de-risk Windfall and brings the company a step closer to realizing its objective of becoming a leading Canadian gold producer.
The Windfall project is located between Val-d’Or and Chibougamau in the Abitibi region of Quebec.
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