Centerra Gold and Premier Gold Mines have signed a deal to form a 50:50 partnership to jointly own and develop the latter's Trans-Canada properties in Ontario, Canada, including the Hardrock Gold project.
Under the terms of the agreement, Centerra will contribute up to C$300m ($239m) in cash to the partnership, while Premier will contribute all property, assets and rights it holds in respect of the property.
Centerra will make an initial cash contribution of C$85m ($68m) to the partnership for its 50% limited partner interest.
Centerra Gold president and CEO Ian Atkinson said: "Forming this partnership gives Centerra's shareholders exposure to a significant gold resource and an advanced stage development project in Ontario, Canada.
"We feel that the Trans-Canada property, including the flagship Hardrock Gold project, complements our growth pipeline, which includes the Gatsuurt project, in Mongolia and the Öksüt project in Turkey."
Premier Gold president and CEO Ewan Downie said: "With this partnership comes a more clear and certain path toward realising the potential that the Trans-Canada property represents to Premier shareholders and neighbouring communities."
Premier's Trans-Canada property consists of a group of mineral claims located in the Geraldton-Beardmore Greenstone Belt extending for 110km between Lake Nipigon and the community of Long Lac in northern Ontario.
The advanced stage Hardrock project is located along the Trans-Canada Highway and is said to be found on one of the larger claim blocks.
The transaction, which is subject to the receipt of applicable regulatory approvals, is expected to close in March.
Image: Geraldton Drill Site. Photo: courtesy of Premier Gold Mines Limited.