TORONTO, Dec. 13, 2021 /CNW/ - New Gold Inc. ("New
Gold" or the "Company") (TSX: NGD) (NYSE American:
NGD) is pleased to announce that it has entered into a
definitive agreement (the "Agreement") with Wheaton Precious Metals
Corp. ("Wheaton") to sell the existing gold stream held on the
Blackwater Project ("Blackwater") located in British Columbia, Canada (the "Transaction").
Blackwater is wholly-owned by Artemis Gold Inc. ("Artemis"), with
New Gold having retained the gold stream as partial consideration
for the divestiture of Blackwater to Artemis on August 21, 2020.
Details of the Transaction are as follows:
- New Gold will receive upfront cash consideration of
US$300 million from Wheaton upon
closing of the Transaction;
- The gold stream entitles Wheaton to 8% of the gold produced
from Blackwater, reducing to 4% of gold production once
approximately 280,000 ounces of gold have been delivered to
Wheaton. Gold delivered under the stream is subject to an ongoing
cash price equal to 35% of the spot gold price, payable to
Artemis.
"This transaction highlights another milestone for New Gold as
we continue to surface value from the divestment of the Blackwater
Project. The cash payment will provide additional liquidity
and financial capacity to New Gold as we continue to execute on our
strategy," stated Renaud Adams,
President & CEO.
New Gold has agreed to waive its right of first refusal with
respect to Wheaton's offer on November 15,
2021 to purchase a silver stream on Blackwater from Artemis.
Artemis has also waived its right of first offer to acquire the
gold stream, which was available to Artemis under the terms of the
gold stream agreement. The Transaction is expected to close by the
end of 2021.
Scotiabank is acting as financial advisor to New Gold, and
Davies Ward Phillips & Vineberg LLP is acting as New Gold's
legal advisor.
About New Gold
New Gold is a Canadian-focused
intermediate mining Company with a portfolio of two core producing
assets in Canada, the Rainy River
gold mine and the New Afton copper-gold mine. The Company also
holds a 5% equity stake in Artemis Gold Inc. and other
Canadian-focused investments. New Gold's vision is to build a
leading diversified intermediate gold company based in Canada that is committed to environment and
social responsibility. For further information on the Company,
visit www.newgold.com.
Cautionary Note Regarding Forward-Looking Statements
Certain information contained in this news release, including any
information relating to New Gold's future financial or operating
performance are "forward-looking". All statements in this news
release, other than statements of historical fact, which address
events, results, outcomes or developments that New Gold expects to
occur are "forward-looking statements". Forward-looking statements
are statements that are not historical facts and are generally, but
not always, identified by the use of forward-looking terminology
such as "plans", "expects", "is expected", "budget", "scheduled",
"targeted", "estimates", "forecasts", "intends", "anticipates",
"projects", "potential", "believes" or variations of such words and
phrases or statements that certain actions, events or results
"may", "could", "would", "should", "might" or "will be taken",
"occur" or "be achieved" or the negative connotation of such terms.
Forward-looking statements in this news release include, among
others, statements with respect to: the cash consideration to be
received from Wheaton upon closing of the Transaction; the
provision of liquidity and financial capacity for the Company; and
the expected timing of the Transaction.
All forward-looking statements in this news release are based on
the opinions and estimates of management that, while considered
reasonable as at the date of this press release in light of
management's experience and perception of current conditions and
expected developments, are inherently subject to important risk
factors and uncertainties, many of which are beyond New Gold's
ability to control or predict. Certain material assumptions
regarding such forward-looking statements are discussed in this
news release, New Gold's latest annual management's discussion and
analysis ("MD&A"), its most recent annual information form and
technical reports on the New Afton Mine filed on SEDAR at
www.sedar.com and on EDGAR at www.sec.gov. In addition to, and
subject to, such assumptions discussed in more detail elsewhere,
the forward-looking statements in this news release are also
subject to the following assumptions: (1) there being no
significant disruptions affecting New Gold's operations other than
as set out herein; (2) political and legal developments in
jurisdictions where New Gold operates being consistent with New
Gold's current expectations; (3) prices for diesel, natural gas,
fuel oil, electricity and other key supplies being approximately
consistent with current levels; (4) equipment, labour and materials
costs increasing on a basis consistent with New Gold's current
expectations; (5) arrangements with First Nations and other
Aboriginal groups in respect of the New Afton Mine and Rainy River
Mine being consistent with New Gold's current expectations; (6) all
required permits, licenses and authorizations being obtained from
the relevant governments and other relevant stakeholders within the
expected timelines; (7) there being no significant disruptions to
the Company's workforce at either the New Afton Mine or Rainy River
Mine due to cases of COVID-19 or any required self-isolation
requirements (due, among other things, to cross-border travel to
the United States or any other
country); (8) the responses of the relevant governments to the
COVID-19 outbreak being sufficient to contain the impact of the
COVID-19 outbreak; (9) there being no material disruption to the
Company's supply chains and workforce that would interfere with the
Company's anticipated course of action at the New Afton Mine or
Rainy River Mine; and (10) the long-term economic effects of the
COVID-19 outbreak not having a material adverse impact on the
Company's operations or liquidity position.
Forward-looking statements are necessarily based on estimates
and assumptions that are inherently subject to known and unknown
risks, uncertainties and other factors that may cause actual
results, level of activity, performance or achievements to be
materially different from those expressed or implied by such
forward-looking statements. Such factors include, without
limitation: significant capital requirements and the availability
and management of capital resources; additional funding
requirements; price volatility in the spot and forward markets for
metals and other commodities; fluctuations in the international
currency markets and in the rates of exchange of the currencies of
Canada, the United States and, to a lesser extent,
Mexico; volatility in the market
price of the Company's securities; hedging and investment related
risks; dependence on the Rainy River Mine and New Afton Mine;
discrepancies between actual and estimated production, between
actual and estimated mineral reserves and mineral resources and
between actual and estimated metallurgical recoveries; risks
related to early production at the Rainy River Mine, including
failure of equipment, machinery, the process circuit or other
processes to perform as designed or intended; risks related to
construction, including changing costs and timelines; adequate
infrastructure; fluctuation in treatment and refining charges;
changes in national and local government legislation in
Canada, the United States and, to a lesser extent,
Mexico or any other country in
which New Gold currently or may in the future carry on business;
global economic and financial conditions; risks relating to New
Gold's debt and liquidity; the adequacy of internal and disclosure
controls; taxation; impairment; conflicts of interest; risks
relating to climate change; controls, regulations and political or
economic developments in the countries in which New Gold does or
may carry on business; the speculative nature of mineral
exploration and development, including the risks of obtaining and
maintaining the validity and enforceability of the necessary
licenses and permits and complying with the permitting requirements
of each jurisdiction in which New Gold operates; the lack of
certainty with respect to foreign legal systems, which may not be
immune from the influence of political pressure, corruption or
other factors that are inconsistent with the rule of law; the
uncertainties inherent to current and future legal challenges New
Gold is or may become a party to; risks relating to proposed
acquisitions and the integration thereof; information systems
security threats; diminishing quantities or grades of mineral
reserves and mineral resources; competition; loss of, or inability
to attract, key employees; rising costs of labour, supplies, fuel
and equipment; actual results of current exploration or reclamation
activities; uncertainties inherent to mining economic studies;
changes in project parameters as plans continue to be refined;
accidents; labour disputes; defective title to mineral claims
or property or contests over claims to mineral properties;
unexpected delays and costs inherent to consulting and
accommodating rights of Indigenous groups; risks, uncertainties and
unanticipated delays associated with obtaining and maintaining
necessary licenses, permits and authorizations and complying with
permitting requirements; disruptions to the Company's workforce at
either the Rainy River Mine or the New Afton Mine, or both, due to
cases of COVID-19 or any required self-isolation (due to
cross-border travel, exposure to a case of COVID-19 or otherwise);
the responses of the relevant governments to the COVID-19 outbreak
not being sufficient to contain the impact of the COVID-19
outbreak; disruptions to the Company's supply chain and workforce
due to the COVID-19 outbreak; an economic recession or downturn as
a result of the COVID-19 outbreak that materially adversely affects
the Company's operations or liquidity position; there being further
shutdowns at the Rainy River or New Afton Mines; the Company not
being able to complete its construction projects at the Rainy River
Mine or the New Afton Mines on the anticipated timeline or at all;
and the Company not being able to complete the exploration drilling
program to be launched at the Rainy River Mine and Cherry Creek on the anticipated timeline or at
all. In addition, there are risks and hazards associated with the
business of mineral exploration, development and mining, including
environmental events and hazards, industrial accidents, unusual or
unexpected formations, pressures, cave-ins, flooding and gold
bullion losses (and the risk of inadequate insurance or inability
to obtain insurance to cover these risks) as well as "Risk Factors"
included in New Gold's most recent annual information form,
MD&A and other disclosure documents filed on and available on
SEDAR at www.sedar.com and on EDGAR at www.sec.gov. Forward
looking statements are not guarantees of future performance, and
actual results and future events could materially differ from those
anticipated in such statements. All forward-looking statements
contained in this news release are qualified by these cautionary
statements. New Gold expressly disclaims any intention or
obligation to update or revise any forward-looking statements
whether as a result of new information, events or otherwise, except
in accordance with applicable securities laws.
View original content to download
multimedia:https://www.prnewswire.com/news-releases/new-gold-to-sell-blackwater-gold-stream-for-us300-million-301443560.html
SOURCE New Gold Inc.