US-based silver producer Coeur Mining has signed an agreement with a Goldcorp subsidiary to acquire 100% of Wharf gold mine located near Lead, South Dakota for $105m.
Goldcorp president and CEO Chuck Jeannes said: "This divestiture of Wharf will unlock additional value for Goldcorp shareholders and demonstrates our commitment to focusing on the core assets within our portfolio.
"We thank the team at Wharf for their commitment and dedication and we wish them continued success as part of Coeur Mining. We will work closely with the team at site to ensure a smooth transition."
The open pit Wharf gold mine is expected to produce 85,000oz to 90,000oz of gold in 2015 at an all-in sustaining cost of $800 to $875 per ounce.
Wharf is said to have been in production for more than 30 years after commencing operations with an estimated three-year mine life. Over that period the mine produced more than two million ounces of gold.
With a current reserve base of 560,000oz of gold, Wharf operates with a strong social licence, which has provided substantial benefits to the operation.
Coeur president and CEO Mitchell Krebs said: "The acquisition of Wharf further establishes Coeur as a leading, growing producer of silver and gold in the Americas while improving our overall portfolio with strong cashflow generation in a low-risk jurisdiction.
"We believe this transaction will generate an attractive rate of return and is immediately accretive to cashflow and net asset value."
The agreement, which is slated for completion by the end of the first quarter of 2015, is subject to US antitrust approval and other customary closing conditions.
Image: Wharf gold mine is expected to produce 85,000oz to 90,000oz of gold in 2015. Photo: courtesy of Goldcorp.