Sudbury Contact Mines (TSE) and Agnico-Eagle Mines (TSE) have reached a flow-through private placement agreement.
By issuing 533,333 shares, Sudbury Contact will receive aggregate proceeds of $2 million which it will use to explore properties in Ontario and Quebec. Of particular interest is the recent gold discovery on the company’s Diamond Lake properties.
“The initial program had a few holes spaced at 200-metre centres,” said Peter Hubacheck, geological consultant for Sudbury Contact. “We are now completing magnetic and induced polarization surveys east and west of this zone and we plan to have two drills on the property in about three weeks.” Under the flow-through agreement (and subject to regulatory approval), Agnico will receive the full tax benefits associated with the incurred exploration expenses.
Agnico’s share in affiliate Sudbury Contact will rise to 18.3% from 13%. In addition, two companies associated with Agnico own an aggregate of 47% of the outstanding common shares of Sudbury Contact.
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