NOVAGOLD RESOURCES INC. has received US$75 million from Newmont Corp. as per the 2018 share purchase agreement in which NOVAGOLD agreed to sell its 50% interest in the Galore Creek project (GCP) in British Columbia, Canada.
Under the terms of the July 2018 agreement, total consideration payable by Newmont was up to US$275 million. NOVAGOLD received US$100 million upon closing and US$75 million 27 July 2021. The remaining amounts related to the 2018 sale of the GCP are payable as follows:
- US$25 million upon the earlier of: (i) completion of a project feasibility study prepared by or for GCP, or (ii) 5 years from the closing date on 27 July 2023.
- US$75 million contingent upon GCP construction approval.
The latest payment from Newmont will increase NOVAGOLD’s cash position by US$75 million, which consisted of approximately US$108 million of cash and term deposits as of 31 May 2021.
As a result of the successful sale of GCP, NOVAGOLD materially increased its treasury, providing the company with a strong financial foundation to advance its 50%-owned Donlin Gold project (Donlin Gold) in Alaska. The company expects its existing financial resources and future incoming payments to be sufficient to execute on its business plan without resorting to raising more capital until a construction decision on Donlin Gold is made.
Read the article online at: https://www.globalminingreview.com/finance-business/29072021/novagold-receives-payment-from-newmont-corp/