Nunavut’s largest gold producer has agreed to purchase the territory’s only other active gold mine at a higher price than a previous deal that was quashed by the federal government in December.

After losing out on a deal to have Chinese company Shandong Gold Mining purchase its assets, TMAC Resources, operator of the gold mine at Hope Bay, has found a new buyer in Agnico Eagle Mines.
photo courtesy of TMAC Resources

Agnico Eagle Mines, which has two operating gold mines in the Kivalliq region, has agreed to pay $2.20 per share to acquire TMAC Resources and operational control of its Hope Bay project in the Kitikmeot region, for a total of $286.6 million.

TMAC had previously accepted Shandong Gold Mining’s offer of $1.75 per share – representing $230 million – but that arrangement fell apart on Dec. 21 when the Government of Canada, upon concluding a national security review, prevented the Chinese state-owned company from taking ownership of Canadian resources.

Agnico Eagle has also agreed to take care of TMAC’s outstanding debt and deferred interest and fees.

Sean Boyd, Agnico Eagle’s vice-chairman and CEO, stated, “We are very pleased to have the opportunity to bring our extensive Northern operational and community experience to the Hope Bay Mine and the Kitikmeot region of Nunavut. Together with the TMAC team and our Nunavut partners, we look forward to advancing exploration and expansion initiatives to realize the full potential of the mine and its large unexplored land package.”

Jason Neal, TMAC’s president and CEO, commented, “I am very excited to welcome Agnico Eagle to Hope Bay… the acquisition being completed by Agnico Eagle is a great outcome for all stakeholders. Agnico Eagle is one of the strongest gold producers internationally, a Canadian champion and has been operating in Nunavut for more than a decade with a great track record with communities, employees and the environment.”

In a Dec. 21 news release following the federal government announcement that that Shandong purchase was denied, Neal acknowledged that debt-ridden TMAC Resources was positioned to fund sealift in 2021 but didn’t have the ability to repay money that is due on June 30, putting TMAC’s future in question.

TMAC’s transaction with Agnico Eagle is still subject to approval under the Competition Act and to an Ontario Superior Court amendment of the previous purchase agreement. The two companies are aiming to complete the deal as of Feb. 8.

TMAC Resources began producing gold in early 2017 from Doris, its first mine at Hope Bay, 125 km southwest of Cambridge Bay. The company has also obtained permits to produce from its Madrid and Boston gold deposits.

Agnico Eagle yields gold from the Meliadine mine, 25 km north of Rankin Inlet and the Amaruq deposit, 50 km northwest of Baker Lake. The company operated the Meadowbank Mine, 110 km north of Baker Lake, from 2010-2019, producing more than three million ounces of gold.

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Derek Neary

Derek Neary has been reporting on developments in the North for 18 years. When he's not writing for Nunavut News, he's working on Northern News Services' special publications such as Opportunities North,...