IDM Mining Ltd. is pleased to announce that it has completed the acquisition of the minerals claims and certain other related assets comprising the Red Mountain Project from Seabridge Gold Inc.
IDM acquired the 100% interest, subject to certain underlying agreements and royalties, pursuant to the Option Agreement entered into in April 2014. The Red Mountain Project covers an area of 17,125 hectares and is located 15km northeast of the town of Stewart, BC.
"Completing the acquisition of title for a 100% interest in the Red Mountain Project is another significant step for IDM Mining," said Rob McLeod, President and CEO of IDM Mining. "We are grateful to have worked with Seabridge as the property vendor, and are excited for further milestones as we advance the Project towards a production decision for a high-grade gold, bulk mining underground operation."
In accordance with the Option Agreement, the Company replaced Seabridge's $1.0 million reclamation security held by the Province of British Columbia, IDM is obligated to make a $1.5 million cash payment to Seabridge upon the commencement of commercial production at Red Mountain and Seabridge retains the right to acquire 10% of the annual gold production from the Project at a cost of US$1,000 per ounce up to a maximum of 500,000 ounces produced (50,000 ounces to Seabridge). Alternatively, at Seabridge's sole option, Seabridge may elect to receive a one-time cash payment of $4 million at the commencement of production in exchange for the gold metal stream interest.
About Red Mountain
The Red Mountain Gold Project is located in northwestern BC, 15 km northeast of the Town of Stewart. IDM will release shortly the results of a Feasibility Study for a high-grade, underground gold mine, which envisions primarily bulk underground mining methods and the production of gold doré on site. The Project is advancing through the provincial and federal environmental assessment processes, with comprehensive, thorough, and ongoing consultation with Nisga'a Nation.