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First Mining closes streaming deal on northwest mine project

Workers return to project site to resume geotechnical and environmental field work
First Mining Springpole 6
First Mining Gold's Springpole Project (Company photo)

First Mining Gold has closed a US$22.5-million silver streaming deal with First Majestic Silver to advance its Springpole open-pit gold and silver mine project in northwestern Ontario.

In a July 2 release, the Vancouver developer said most of the proceeds will be used for the project's prefeasibility study and the ongoing environmental assessment process on the almost 42,000-hectare property.

The project, 110 kilometres northeast of Red Lake, is now in the technical study and permitting stage. At last count, the mine has a projected 12-year operating life.

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The deposit contains 24.19 million ounces of indicated silver, 1.12 million ounces of silver in the inferred category, plus 4.67 million ounces of indicated gold and 0.23 million ounces of inferred gold. The pre-feasibility study is due out early next year.

The streaming deal, first announced in early June, gives First Majestic Silver the right to purchase half of the silver produced from Springpole over the life of the mine. The money is being paid in cash and shares over three payments.

There are also additional payments in the deal are based on certain project-related milestones. Upon completion of a positive pre-feasibility study for Springpole, First Mining will receive $7.5 million from First Majestic, with a further $5 million coming upon receiving approval of a federal or provincial environmental assessment for the project.

This is First Majestic's first streaming deal. Its primary mineral assets are three silver mines in Mexico where the company also has a stable of exploration projects.

The company said its field personnel returned to the site last month to continue environmental and geotechnical data collection efforts. All employees and contracors at the Springpole camp is operating under a strict COVID-19 risk mitigation procedures.