Goldcorp has signed an agreement to acquire Canada-based Kaminak Gold in a transaction valued at about C$520m ($404m).

The acquisition will give Goldcorp access to Kaminak’s 100%-owned key asset Coffee Gold project, which is located about 130km south of the City of Dawson, Yukon.

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The Coffee land package consists of more than 60,000ha and currently has total indicated gold mineral resources of three million ounces inclusive of total probable gold mineral reserves of 2.2 million ounces.

Goldcorp president and CEO David Garofalo said: “This acquisition is consistent with our strategy of partnering with junior exploration companies to identify and develop mining districts with significant exploration potential that is expected to grow our net asset value per share.

“This transaction realises many immediate benefits for our shareholders and at the same time ensures that the Coffee Gold project will be developed in a timely and responsible manner.”

“Coffee is located within a politically stable jurisdiction and provides us with an opportunity to add high quality ounces to our development pipeline, at low all-in sustaining costs.”

Kaminak said that Goldcorp has the financial strength to develop the Coffee Gold project and unlock its resource expansion potential in the short to medium term.

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Kaminak Gold president and CEO Eira Thomas said: “This transaction realises many immediate benefits for our shareholders and at the same time ensures that the Coffee Gold project will be developed in a timely and responsible manner.

“Coffee is a natural fit within their portfolio and they have the experience, expertise and financial flexibility to build Coffee for the benefit of our First Nations partners and all Yukon stakeholders.”

The transaction, which is subject to receipt of all necessary regulatory and court approvals, is expected to close in August 2016.