The gold producer Gold Fields – one of the largest in the world – has just found a way to set foot in Quebec: by offering 600 million to Minière Osisko to buy half of the Windfall gold project, considered very promising.
Located 115 kilometers east of Lebel-sur-Quévillon, on the traditional lands of the Cree First Nation of Waswanipi, this world-class deposit valued at $1.2 billion thus reaches an important milestone. It could be the next gold mine built on Quebec territory.
In a context where mergers and takeovers are frequent in the mining industry, the agreement reached with the South African mining giant allows Osisko Mining, whose head office is in Toronto, to ensure that it retains control over the project, according to its president, Mathieu Savard.
“We could have sought financing on the markets, but that would have changed the shareholding, he explains in a telephone interview. We wanted to make sure that Osisko could cross the finish line [the operations phase] and go beyond. This is quite a commitment that Gold Fields makes by investing in Quebec. »
The agreement takes the form of a joint venture. It will be owned equally by the two companies. The multinational will pay a first tranche of 300 million to its partner and the other payments will be made as the permits – construction and operation – are obtained. It will also inject 75 million to finance regional mining exploration.
Beyond the diminishing financial risk for the Windfall project, Mr. Gaumond, in a telephone interview with La Presse, is especially delighted to see Quebec attract one of the biggest players in the gold industry.
This bodes well for the longer term, according to the businessman.
“We have just attracted a new multinational that is coming to spend in Quebec,” he says. She may make other acquisitions in the future. We may become their American pole. »
At the time of this writing, it had not been possible to speak with representatives of Gold Fields. In a statement, the Johannesburg-based company said it looked at several locations in the region before reaching an agreement with Osisko.
“We believe this mine will be the first of several under this partnership, in a very promising area,” said Gold Fields interim CEO Martin Preece.
Mining analyst at EBL Consultants, Éric Lemieux agrees with Mr. Gaumond. While he believes Osisko got a fair price for half of the gold project, the specialist nevertheless believes that Gold Fields is getting a “good deal” by entering into a $600 million partnership. As recently as the winter of 2022, Osisko’s joint venture with Australian producer Northern Star fell through, Lemieux said.
“Quebec has a good reputation, but each project is on a case-by-case basis,” says Lemieux. When Northern Star decided to pull out, was it because there was something wrong? The arrival of Gold Fields is nevertheless favorable. This demonstrates that an outside company sees value in a stable jurisdiction. »
On the Toronto Stock Exchange, investor reaction was mixed despite the arrival of Gold Fields alongside Osisko Mining. On Tuesday, on the Bay Street trading floor, the company’s stock fell 19 cents, or 5%, to trade at $3.58.
According to Osisko’s feasibility study, the life of the Windfall mine, if built, is expected to be 10 years. The project could result in the creation of 670 permanent jobs during operation. An average annual production of 306,000 ounces of yellow metal is anticipated.
At the end of March, the impact study was submitted to the Environmental and Social Impact Review Committee. It is an independent body made up of members appointed by Quebec and the Cree Nation. They examine the impact of projects on territory governed by the James Bay and Northern Quebec Agreement.
Osisko: 1997
Gold Fields : 1897
Osisko : 1 pays (Canada)
Gold Fields: 5 countries (Australia, South Africa, Ghana, Peru, Chile)
Osisko: 0
Gold Fields : 9
Osisko: 175 employees
Gold Fields: 22,000 employees
