Canadian mining company Finlay Minerals has received the TSX Venture Exchange’s conditional acceptance for its earn-in agreements with Freeport-McMoRan concerning the PIL and ATTY properties, located in Toodoggone mining district of north-central British Columbia, Canada.
The PIL earn-in agreement enables Freeport to obtain an 80% interest in the PIL property by making cash payments of C$3m ($2.1m) to Finlay and contributing C$25m in exploration on the PIL property over six years.
The ATTY earn-in agreement allows for an 80% interest acquisition in the ATTY Property with C$1.1m and C$10m in exploration costs. These investments may be accelerated at Freeport’s discretion.
Upon completion of the earn-in, Freeport and Finlay will form a joint venture for further exploration, holding 80% and 20% interests, respectively.
Any party that does not fund their share will see their stake in the joint venture company dilute, potentially converting to a 1% net smelter returns (NSR) royalty.
During the earn-in period, Finlay will operate the properties, reporting to a joint technical committee. Both properties are subject to a 3% NSR royalty held by a private company Electrum Resource Corporation, with Finlay having the right to buy back half of the royalty on each property.
Amended agreements with Electrum outline increased buy-back payments funded by Freeport, avoiding dilution to Finlay’s interest.
The buy-back payments for the PIL property range from $10m to $20m, depending on the timing and stage of feasibility studies or commercial production.
The ATTY property’s buy-back payments vary from $5m to $10m under similar conditions. Additionally, Finlay and Electrum have agreed to extinguish share issuance obligations to Electrum upon a production decision on the properties.
Freeport-McMoRan is an international metals company with a focus on copper and significant operations and reserves in the Americas and Indonesia.
In June 2024, Finlay agreed to acquire the SAY Property, a high-grade copper and silver prospect located 140km north of Smithers in British Colombia from Electrum Resources.
