Skeena buys 13% of TDG beside Freeport find in BC

View of the Greater Shasta-Newberry project. Credit: TDG Gold

Skeena Resources (TSX: SKE; NYSE: SKE) is paying $11 million for a 13% stake in TDG Gold (TSXV: TDG), which plans to advance the Shasta-Newberry project beside the recent porphyry discovery by Freeport-McMoRan (NYSE: FCX) and Amarc Resources (TSXV: AHR) in British Columbia.

Vancouver-based Skeena is buying TDG shares for $7 million in a private placement and selling TDG the Sofia property in the same district for $4 million in shares, the companies said Thursday. 

Shares of TDG Gold closed 25% higher at 57¢ apiece for a market capitalization of $82.9 million. Its 52-week high was 59¢, while its lowest was 8.5¢.

“By providing early-stage funding to TDG, we aim to support TDG’s exploration efforts to validate the Greater Shasta project,” Skeena’s executive chairman, Walter Coles, said in a statement. “The exciting high-grade Freeport-Amarc AuRORA discovery is less than 200 metres from the border of TDG’s claims.”

Geochemical and geophysical data indicate the potential for the mineralized trend to continue over onto TDG’s claims, Cole added. 

Toodoggone

TDG holds mineral claims covering approximately 320 sq. km of the historical Toodoggone production corridor, including the past-producing gold-silver Shasta and Baker mines, which produced intermittently from 1981 to 2012, and the historical high-grade gold Mets developed prospect. Shasta-Newberry is beside Shasta mine and 6 km southeast of Baker mine.

“The recent announcement of the AuRORA discovery on our boundary represents a paradigm shift for the whole Toodoggone district,” TDG CEO Fletcher Morgan said in the same release. “Completion of the private placement, including the support of Skeena, advances our plans for a rapid, focused program to explore the potential extensions from AuRORA onto our 100% owned Greater Shasta-Newberry project.”

With five drill-ready exploration targets, the company says Greater Shasta-Newberry, as a newly defined project, holds the greatest potential for the discovery of gold-silver deposits around the Shasta deposit, for which it has estimated an indicated resource of 515,800 oz. of gold-equivalent and inferred resource of 505,500 ounces. These projects are all road accessible and have a combined 65,000 metres of historical drilling, TDG says.

Sofia

Acquired by Skeena in 2021, the 90-sq.-km Sofia property borders TDG’s concessions in the Toodoggone district. The project is the subject of a nine-hole drill program that intercepted low-grade porphyry-style mineralization, interpreted by Skeena as potentially peripheral to a better mineralized system.

As part of a private placement arranged by TDG, Skeena will act as the back-end purchaser of 14 million flow-through shares at a price of 50¢ per share. Skeena is selling Sofia to TDG in exchange for 8 million TDG shares at 50¢ per share. 

The private placement shares are initially priced at 82.5¢ each, with the original subscriber paying about $11.6 million to TDG. The placement also includes 6 million non-flow-through shares priced at 50¢ issued to other TDG investors, for additional proceeds of $3 million. This brings the total proceeds from the placement to $14.6 million.

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