TSX: FF
OTCQX: FFMGF
FRANKFURT: FMG
VANCOUVER, BC, July 18,
2022 /PRNewswire/ - First Mining Gold Corp.
("First Mining" or the "Company") (TSX: FF) (OTCQX: FFMGF)
(FRANKFURT: FMG) is pleased to announce that it has made an
offer to acquire all of the issued and outstanding shares of
Beattie Gold Mines Ltd. ("Beattie Gold"), a private company
that owns the mineral rights to mining claims that make up the
former Beattie mining concession which forms a large part of the
Duparquet Gold Project (the "Duparquet Gold Project")
located in Quebec, Canada (the
"Beattie Offer"). First Mining, directly and through
its wholly-owned subsidiary, Clifton Star Resources Inc.
("Clifton Star), already owns
approximately 25.3% of the issued and outstanding shares of Beattie
Gold. The total consideration of the Beattie Offer is
$4.43641 cash per Beattie Gold share
and 35 First Mining Shares per Beattie Gold share for a total cash
consideration of $6,227,176 and the
issuance of 49,127,820 First Mining common shares. First
Mining has received signed, irrevocable lock-up agreements from
Beattie Gold shareholders holding, in aggregate, 1,358,652 Beattie
Gold shares, representing 72.3% of the outstanding common shares of
Beattie Gold. Upon acquiring the Beattie Gold shares
committed under the lock-up agreements, First Mining, directly and
through Clifton Star, will own 97.6%
of the outstanding common shares of Beattie Gold.
The Duparquet Gold Project consists of several properties held
in different entities which, in addition to the Beattie property,
include the Donchester, Dumico and Central Duparquet properties. First
Mining, through Clifton Star, is
currently a 10% shareholder of 2588111 Manitoba Ltd ("258
Manitoba"), a private company
that owns the mineral rights to mining claims that make up the
former Donchester mining concession and Dumico property that also
form a part of the Duparquet Gold Project, and a 10% shareholder of
2699681 Canada Ltd ("269 Canada"), a private company that owns in
whole or in part, the surface rights to the Beattie, Donchester and
Dumico properties. First Mining already owns 100% of the
Central Duparquet
property.
Concurrent with making the Beattie Offer, First Mining has
entered into share purchase agreements to acquire all of the issued
and outstanding shares of 258 Manitoba (the "258 Manitoba
Transaction") and 269 Canada (the "269 Canada
Transaction", and together with the 258 Transaction, the
"Concurrent Transactions") that are not already owned by
Clifton Star. The Concurrent
Transactions are conditional on the Beattie Offer, and will close
on the same day as the Beattie Offer, which is expected to be in
mid-September.
The total consideration of the Concurrent Transactions is
$2.5 million in cash and the issuance
of 20,000,000 common shares of First Mining. In aggregate,
the total consideration of the Beattie Offer and the Concurrent
Transactions (assuming that all shareholders of Beattie Gold tender
their shares to the Beattie Offer) is $8,727,177 in cash and 69,127,820 common shares
of First Mining. The total transaction value based on
the twenty trading days volume weighted average price for First
Mining's common shares as of the last trading day prior to this
news release is approximately $24
million.
"This transformational acquisition has been a few years in the
making and grows First Mining's M&I gold resources by 40% and
inferred gold resources by 50%" said Keith
Neumeyer, Chairman of First Mining Gold. "When First
Mining acquired Clifton Star in
2016, we always contemplated the opportunity to consolidate this
advanced stage, highly prospective project. Duparquet fits perfectly with First Mining's
strategy and the capabilities of our team to advance and de-risk a
second world class asset."
"This is a transformational acquisition for First Mining and the
Duparquet Gold Project as we plan on consolidating this highly
fragmented ownership structure under the First Mining banner.
Duparquet hosts a robust resource
profile where two past producing mines have operated in
Quebec's most prolific gold mining
district. First Mining has been a long-time minority
shareholder of the companies that own this Project, and the timing
was right to acquire full ownership of these companies. We are
confident that Duparquet and the
district will prove to be a critical strategic asset in the gold
sector in Canada as this
transaction affirms First Mining's positioning as a multi-asset
developer of major projects in Tier 1 jurisdictions," stated
Dan Wilton, CEO of First Mining.
"Together with our ownership of the Pitt and Duquesne projects in Quebec located just east of Duparquet, First Mining will now have 100%
ownership exposure to 3.3 million M&I ounces of gold and 2.0
million inferred ounces of gold located in the Abitibi, which is
home to some of the largest and richest mineral deposits in the
world. First Mining has completed extensive due diligence and
will develop a comprehensive plan to advance the Duparquet Gold
Project in the near-term. Springpole remains a core focus and
priority as we continue to advance the project through feasibility
and the environmental assessment process. The addition of
Duparquet results in First Mining
owning 100% of two projects with multi-million ounce gold resources
in what we consider as the best mining jurisdictions in the world
and will allow First Mining to leverage our team's experience with
similar projects in advancing these two major gold
deposits."
Transaction Highlights
- Consolidates one of the largest advanced-stage, undeveloped
gold projects in Canada –
including the Duquesne and Pitt
deposits, to create a multi-million ounce gold resource district
(1, 2, 3)
- Transforms First Mining into a leading Tier I gold development
company with ownership in two prolific Tier 1 multi-million ounce
gold assets located in some of the best mining jurisdictions in the
world in Quebec and Ontario
- NI 43-101 resource estimate of the Duparquet Gold Project
(InnovExplo, 2014) 3.1 Moz M&I at 1.59 g/t Au and 1.4 Moz
Inferred at 1.51 g/t Au meaningfully enhances total resource
profile of First Mining
- Increases First Mining's M&I resource base in Quebec by +450% and its inferred resource base
in Quebec by +150%; increases
First Mining's global M&I resource base by +40% and its global
inferred resource base by +50%
- Accretive acquisition metrics to First Mining on a per ounce
basis
- Consolidates and simplifies highly fragmented and complex
ownership structure of the Duparquet Gold Project by combining
properties, mineral rights and surface rights ownership under one
entity
- Offers potential to significantly improve on 2014
Pre-Feasibility Study completed on the Duparquet Gold Project with
development optimization and more robust economics based on an
improved gold market environment
- Creates exciting exploration upside potential with additional
exploration drilling to expand mineralized zones along strike and
at-depth
- Provides platform for further district consolidation in
Quebec
(1)
|
Source NI 43-101
Technical Report and Prefeasibility Study for the Duparquet
Project, InnovExplo, May 23, 2014
|
(2)
|
Source NI 43-101
Technical Report Resource Estimate of the Duquesne Property, WSP
Canada, Reissued May 25, 2016
|
(3)
|
Source NI 43-101
Technical Report and Review of the Preliminary Mineral Resource
Estimate for the Pitt Gold Project, Micon International Limited,
January 5, 2017
|
Lock-Up Agreements
In connection with the Beattie Offer, First Mining has entered
into binding lock-up agreements with certain shareholders
("Support Shareholders") of Beattie Gold who have agreed to
support the Beattie Offer and to irrevocably tender all of their
common shares of Beattie Gold to the Beattie Offer. The
Support Shareholders collectively hold 1,358,652 Beattie Gold
shares representing approximately 72.3% of the issued and
outstanding common shares of Beattie Gold.
Transaction Details
First Mining intends to make an offer to all registered holders
of common shares of Beattie Gold in accordance with applicable
Canadian securities laws. The Beattie Offer will be subject
to the following conditions: (i) there being deposited under the
Beattie Offer, and not withdrawn, at least 464,643 of the
outstanding common shares of Beattie Gold (the "Take-Up
Condition"), which, when combined with the common shares of
Beattie Gold already held by First Mining (both directly and
through Clifton Star), would
represent ownership of Beattie Gold of 50.1%; and (ii) completion
of the 269 Canada Transaction..
First Mining has entered into binding share purchase agreements
in respect of the 258 Manitoba Transaction and the 269 Canada
Transaction, which are both subject to the Take-Up Condition and
are expected to close concurrently with the closing of the Beattie
Offer. All of the transactions are expected to close in
mid-September 2022.
Upcoming Duparquet Work
Plan
First Mining has concluded substantial due diligence on the
Duparquet Gold Project to date, including understanding the
existing mineral resource estimate and exploration potential at the
Duparquet Gold Project and in the district. First Mining
intends to complete an updated mineral resource estimate in
accordance with NI 43-101 shortly after closing the Beattie Offer
and Concurrent Transactions which will incorporate additional
drilling from 2014 to 2020 not included in the previous mineral
resource estimate.
First Mining will commence an environmental data collection
exercise to update the environmental baseline data collected by
Clifton Star in 2012 and 2013.
Work is also expected to commence on engineering trade-off studies
and an updated economic study to build on the solid technical
foundation established by the Project in the 2014 Pre-Feasibility
Study. First Mining has initiated discussions with the
relevant Quebec ministries and is
committed to working in partnership with regulators, the local
municipality, and Indigenous communities to address environmental
matters and legacy infrastructure as part of the property's
redevelopment. In addition, First Mining intends to commence
a robust regional exploration data compilation, integration and
targeting exercise to develop a path supporting potential resource
expansion, resource classification upgrading, and exploration
discovery.
About the Duparquet Gold
Project
The Duparquet Gold Project is located immediately north of the
town of Duparquet, Quebec and
covers an area of 1,079 hectares, and consists of 50 mining claims,
including two historical mining concessions, which include the four
mining properties: the Beattie property (historical mining
concession 292) owned by Beattie, the Donchester property
(historical mining concession 384) and Dumico property owned by
2588111 Manitoba Ltd., and the Central
Duparquet property owned by First Mining. Both the
Beattie and Donchester properties contain past-producing
underground gold mines. Historical underground workings and a shaft
were developed at the Central
Duparquet property, but no gold was produced. The Duparquet
Gold Project also contains a tailings pond area straddling the
southwest limit of the Beattie property.
Gold was first discovered in the Duparquet region in 1910 with production
commencing in 1933 on the Beattie property and on the Donchester
property in the 1940s. Mining and milling operations ceased
at Duparquet in 1956 after 23
years of continuous production. During its lifetime, the
Beattie mill at Duparquet produced
over 1.3 million ounces of gold at grades higher than 4 g/t.
The Duparquet Gold Project remained mostly dormant until 1987 when
increased exploration and drilling activity resumed.
Clifton Star began work on the
Duparquet Gold Project in 2008 and between 2008 and 2013,
Clifton Star and its partners
completed in excess of 260,000 m of
drilling that were incorporated into the mineral resource estimate
and completed a positive Pre-Feasibility Study in 2014, which
detailed a development plan including a 10,000 tpd open pit mine
and mill. Clifton Star was
acquired by First Mining in April
2016.
Map of the Duparquet
Project
Duparquet Gold Project Mineral
Resource Estimate
This mineral resource estimate was prepared for Clifton Star
Resources Inc. by InnovExplo Inc titled "Technical Report and
Prefeasibility Study for the Duparquet Project" effective
March 26, 2014. The NI 43-101
technical report detailing the mineral resource estimate for the
Duparquet Gold Project is filed on SEDAR (www.sedar.com) and
available on First Mining Gold's website.
Area
|
Cut-off
|
Measured
Resource
|
Indicated
Resource
|
Inferred
Resource
|
(mining
method)
|
(g/t)
|
Tonnage
(tonnes)
|
Au
|
Ounces
|
Tonnage
(tonnes)
|
Au
|
Ounces
|
Tonnage
(tonnes)
|
Au
|
Ounces
|
|
|
(g/t)
|
(g/t)
|
(g/t)
|
Open pit
|
0.45
|
165,100
|
1.45
|
7,711
|
53,070,600
|
1.56
|
2,666,690
|
24,092,300
|
1.18
|
910,631
|
UG mining
|
2.00
|
-
|
-
|
-
|
3,520,700
|
2.78
|
314,275
|
5,592,400
|
2.96
|
532,059
|
Tailings
|
0.45
|
19,600
|
2.06
|
1,295
|
4,105,000
|
0.93
|
123,200
|
-
|
-
|
-
|
Total
|
|
184,700
|
1.52
|
9,006
|
60,696,300
|
1.59
|
3,104,165
|
29,684,700
|
1.51
|
1,442,690
|
Notes to accompany the
Mineral Resource Estimate:
|
|
1.
|
The Independent and
Qualified Persons for the Mineral Resource Estimate, as defined by
NI 43-101, are Kenneth Williamson, M.Sc., P.Geo and Karine
Brousseau, Eng. Under the supervision of Carl Pelletier, B.Sc.,
P.Geo. (InnovExplo Inc.), and the effective date of the estimate is
May 22, 2012 for the Tailings resource and June 26, 2013 for the
In-Pit and Underground mineral resources.
|
2.
|
Mineral Resources which
are not Mineral Reserves, do not have demonstrated economic
viability.
|
3.
|
Tailings results are
presented undiluted and in situ. The estimate includes four (4)
tailings ponds.
|
4.
|
In-Pit results are
presented undiluted and in situ, within Whittle-optimized pit
shells. The estimate includes 60 gold-bearing zones and the
envelope containing isolated gold intercepts.
|
5.
|
Underground results are
presented undiluted and in situ, outside Whittle-optimized pit
shells. The estimate includes 60 gold-bearing zones and the
envelope containing isolated gold intercepts.
|
6.
|
Tailings resources were
compiled at cut-off grades of 0.35, 0.40, 0.45, 0.50, 0.55, 0.60,
0.65, 0.70, 0.80 and 0.9 g/t Au.
|
7.
|
In-Pit resources were
compiled at cut-off grades of 0.35, 0.40, 0.45, 0.50, 0.55, 0.60,
0.65, 0.70, 0.80 and 0.9 g/t Au.
|
8.
|
Underground resources
were compiled at cut-off grades of 1.5, 2.0, 2.5, 3.0, 3.5, 4.0 and
5.0 g/t Au.
|
9.
|
Cut-off grades must be
re-evaluated in light of prevailing market conditions (gold price,
exchange rate and mining cost).
|
10.
|
Tailings: A fixed
density of 1.45 g/cm3 was used in zones and waste.
|
11.
|
In-Pit and Underground:
A fixed density of 2.73 g/cm3 was used in the mineralized zones and
in the envelope zone.
|
12.
|
In-Pit and Underground:
A minimum true thickness of 3.0 m was applied, using the grade of
the adjacent material when assayed, or a value of zero when not
assayed.
|
13.
|
Tailings: High grade
capping was done on the raw data and established at 13.0 g/t Au for
Zone 1, 3.5 g/t Au for Zone 2, 1.7 g/t Au for Zone 3 and 2.2 g/t Au
for Zone 4.
|
14.
|
In-Pit and Underground:
High grade capping was done on the raw data and established at 25.0
g/t Au for diamond drill hole assays and channel sample
assays.
|
15.
|
Tailings: Compositing
was done on drill hole sections falling within the mineralized zone
solids (composite = 0.5 m).
|
16.
|
In-Pit and Underground:
Compositing was done on drill hole and channel sample sections
falling within the mineralized zone solids (composite = 1
m).
|
17.
|
Tailings: Resources
were evaluated from drill hole and surface channel samples using an
ID2 interpolation method in a block model.
|
18.
|
In-Pit and Underground:
Resources were evaluated from drill hole and surface channel
samples using an ID2 interpolation method in a multi-folder percent
block model.
|
19.
|
Tailings: Measured and
Indicated categories were defined based on the drill hole spacing
(Measured: zones 1 and 2 = 30m x 30m grid; Indicated: zone 3 = 100m
x 100m grid and zone 4 = 200m x 200m grid).
|
20.
|
The In-Pit Measured
category is defined by blocks having a volume of at least 25%
within an envelope built at a distance of 10 m around existing
channels.
|
21.
|
The In-Pit and
Underground Indicated category is defined by the combination of
blocks within a maximum distance of 15m from existing stopes and
blocks for which the average distance to drill hole composites is
less than 30 m.
|
22.
|
Ounce (troy) = Metric
tons x Grade / 31.10348. Calculations used metric units (metres,
tonnes and g/t).
|
23.
|
The number of metric
tons was rounded to the nearest hundred. Any discrepancies in the
totals are due to rounding effects; rounding followed the
recommendations in NI 43-101.
|
24.
|
InnovExplo is not aware
of any known environmental, permitting, legal, title-related,
taxation, socio-political or marketing issues or any other relevant
issue that could materially affect the Mineral Resource
Estimate.
|
25.
|
Input parameters used
for McoG estimation and Whittle pit design: Gold price: C$ 1,450;
Gold selling cost: C$ 5.00; Mining costs: C$ 2.40; Processing cost:
C$ 13.46; Transportation cost: C$ 0.25; Administration cost: C$
4.18; Processing recovery: 93.9%; Mining recovery: 90.9%; Mining
dilution: 10.0%; Overall pit slope: 52°.
|
26.
|
Parameters used for
UcoG estimation: Gold price: C$ 1,450; Gold selling cost: C$ 5.00;
Mining cost: C$ 58.00; Milling cost: C$ 13.46; Processing recovery:
93.9%; Mining dilution: 15.0%.
|
Pitt and Duquesne Mineral Resource
Estimate
Property
|
Indicated
Resource
|
Inferred
Resource
|
|
Tonnage
(tonnes)
|
Au
|
Ounces
|
Tonnage
(tonnes)
|
Au
|
Ounces
|
|
(g/t)
|
(g/t)
|
Pitt(1)
|
-
|
-
|
-
|
1,076,000
|
7.42
|
257,000
|
Duquesne(2)
|
1,859,200
|
3.33
|
199,161
|
1,563,100
|
5.58
|
280,643
|
Total
|
1,859,200
|
3.33
|
199,161
|
2,639,100
|
6.34
|
537,643
|
|
Notes to accompany the
Pitt and Duquesne Mineral Resource Estimate:
|
|
(1)
|
Notes for
Pitt:
|
|
|
|
- Based on the technical report titled "NI
43-101 Technical Report and Review of the Preliminary Resource
Estimate for the Pitt Gold Project, Duparquet Township, Abitibi
Region, Quebec, Canada" dated January 5, 2017, which was prepared
for First Mining by Micon International Limited in accordance with
NI 43-101, and which is available under First Mining's SEDAR
profile at www.sedar.com
- Cut-off grade = 3 g/t Au, Minimum block width
= 1.5 metres, Dilution grade = 0 g/t, Capping grade = 35 g/t
Au.
|
(2)
|
Notes for
Duquesne:
|
|
|
|
- Based on the technical report titled "43-101
Technical Report Resource Estimate of The Duquesne Gold Property"
dated July 26, 2011, which is available at www.sedar.com under the
SEDAR profile for Clifton Star Resources Inc.
- Cut-off grade = 1.0 g/t Au without taking
into account the width and no dilution was applied when the
horizontal width was 1 metre or less.
|
Webinar
For more context, please join CEO Dan
Wilton for a quick live event on July
19, 2022 at 9am PT /
12 pm ET. Click here to register:
https://my.6ix.com/L1_Gqkwn.
Qualified Person
Mr. Louis Martin P.Geo., (OGQ
0364), a consultant of First Mining, is a "Qualified Person" for
the purposes of National Instrument 43-101 Standards of
Disclosure for Mineral Projects, and he has reviewed and
approved the scientific and technical disclosure contained in this
news release.
About First Mining Gold
Corp.
First Mining is a Canadian gold developer focused on the
development and permitting of the Springpole Gold Project in
northwestern Ontario. Springpole is one of the largest
undeveloped gold projects in Canada. The results of a positive
Pre-Feasibility Study for the Springpole Gold Project were
announced by First Mining in January
2021, and permitting activities are on-going with submission
of a draft Environmental Assessment ("EA") and Environmental
Impact Statement ("EIS") for the project targeted for 2022.
The Company also holds a large equity position in
Treasury Metals Inc. who are advancing the Goliath Gold
Complex toward construction. First Mining's portfolio of gold
projects in eastern Canada also
includes the Pickle Crow (being advanced in partnership with Auteco
Minerals Ltd.), Hope Brook
(being advanced in partnership with Big Ridge Gold Corp.),
Cameron, Duparquet, Duquesne, and Pitt gold projects.
First Mining was established in 2015 by Mr. Keith Neumeyer, founding President and CEO of
First Majestic Silver Corp.
ON BEHALF OF FIRST MINING GOLD
CORP.
Daniel W. Wilton
Chief Executive Officer and Director
Cautionary Note Regarding
Forward-Looking Statements
This news release includes certain "forward-looking
information" and "forward-looking statements" (collectively
"forward-looking statements") within the meaning of applicable
Canadian and United States
securities legislation including the United States Private
Securities Litigation Reform Act of 1995. These forward-looking
statements are made as of the date of this news release.
Forward-looking statements are frequently, but not always,
identified by words such as "expects", "anticipates", "believes",
"plans", "projects", "intends", "estimates", "envisages",
"potential", "possible", "strategy", "goals", "opportunities",
"objectives", or variations thereof or stating that certain
actions, events or results "may", "could", "would", "might" or
"will" be taken, occur or be achieved, or the negative of any of
these terms and similar expressions.
Forward-looking statements in this news release relate to
future events or future performance and reflect current estimates,
predictions, expectations or beliefs regarding future events and
include, but are not limited to, statements with respect to: (i)
the satisfaction of the Take-Up Condition and the closing date of
the Beattie Offer and the Concurrent Transactions; (ii) First
Mining's plans to complete an updated mineral resource estimate for
the Duparquet Gold Project in accordance with NI 43-101 shortly
after closing the Beattie Offer and the Concurrent Transactions,
including its plans to incorporate drilling data from 2014 to 2022
in such updated estimate; (iii) First Mining's plans to commence an
environmental data collection exercise for the Duparquet Gold
Project and its plans to undertake engineering trade-off studies
and complete an updated economic study for the project; and (iv)
First Mining's plans to commence a regional exploration data
compilation, integration and targeting exercise at the Duparquet
Gold Project. All forward-looking statements are based on First
Mining's or its consultants' current beliefs as well as various
assumptions made by them and information currently available to
them. There can be no assurance that such statements will prove to
be accurate, and actual results and future events could differ
materially from those anticipated in such statements.
Forward-looking statements reflect the beliefs, opinions and
projections on the date the statements are made and are based upon
a number of assumptions and estimates that, while considered
reasonable by the respective parties, are inherently subject to
significant business, economic, competitive, political and social
uncertainties and contingencies. Such factors include, without
limitation the Company's business, operations and financial
condition potentially being materially adversely affected by the
outbreak of epidemics, pandemics or other health crises, such as
COVID-19, and by reactions by government and private actors to such
outbreaks; risks to employee health and safety as a result of the
outbreak of epidemics, pandemics or other health crises, such as
COVID-19, that may result in a slowdown or temporary suspension of
operations at some or all of the Company's mineral properties as
well as its head office; fluctuations in the spot and forward
price of gold, silver, base metals or certain other commodities;
fluctuations in the currency markets (such as the Canadian dollar
versus the U.S. dollar); changes in national and local government,
legislation, taxation, controls, regulations and political or
economic developments; risks and hazards associated with the
business of mineral exploration, development and mining (including
environmental hazards, industrial accidents, unusual or unexpected
formations, pressures, cave-ins and flooding); the presence of laws
and regulations that may impose restrictions on mining; employee
relations; relationships with and claims by local communities,
indigenous populations and other stakeholders; availability and
increasing costs associated with mining inputs and labour; the
speculative nature of mineral exploration and development; title to
properties.; and the additional risks described in the Company's
Annual Information Form for the year ended December 31, 2021 filed with the Canadian
securities regulatory authorities under the Company's SEDAR profile
at www.sedar.com, and in the Company's Annual Report on Form
40-F filed with the SEC on EDGAR.
First Mining cautions that the foregoing list of factors that
may affect future results is not exhaustive. When relying on our
forward-looking statements to make decisions with respect to First
Mining, investors and others should carefully consider the
foregoing factors and other uncertainties and potential events.
First Mining does not undertake to update any forward-looking
statement, whether written or oral, that may be made from time to
time by the Company or on our behalf, except as required by
law.
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SOURCE First Mining Gold Corp.