Agnico Eagle to Purchase the Exploration Assets of Canadian Malartic Corporation; Including the Kirkland Lake and Hammond Reef GOLD Projects
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Stock Symbol: AEM (NYSE and TSX)
For further information: Investor Relations
(416) 947-1212
AGNICO EAGLE TO PURCHASE THE EXPLORATION ASSETS OF CANADIAN
MALARTIC CORPORATION; INCLUDING THE KIRKLAND LAKE AND HAMMOND
REEF GOLD PROJECTS
Toronto (December 21, 2017) – Agnico Eagle Mines Limited (NYSE:AEM, TSX:AEM)
("Agnico Eagle" or the "Company") today announced that it has agreed to acquire all of the
Canadian exploration assets of Canadian Malartic Corporation (" CMC"), including the
Kirkland Lake and Hammond Reef Gold projects (the "Transaction"). CMC is a corporation
50-50 owned and operated by Agnico Eagle and Yamana Gold Inc. (" Yamana"). The
Transaction is being structured as an asset deal, whereby Agnico Eagle will acquire all of
Yamana's indirect 50% interest in the Canadian exploration assets of CMC, giving Agnico
Eagle 100% ownership of CMC's int erest in the assets on closing of the Transaction. The
effective purchase price after the distribution of the sale proceeds by CMC to its
shareholders will be US$162.5 million in cash. The Transaction will not affect the Canadian
Malartic mine and related assets including Odyssey , East Malartic , Midway, and East
Amphi, which will continue to be jointly owned and operated by the Company and Yamana
through CMC and the Canadian Malartic General Partnership ("Canadian Malartic GP").
"The purchase of the CMC asset portfolio enhances our longer-term development pipeline,
and provides us with potential production growth post our current mine buildout in Nunavut”,
said Sean Boyd, Agnico Eagle's Chief Executive Officer. "The Kirkland Lake property
package enhances our current mineral reserves and offers near -term exploration upside,
while the Hammond Reef project provides good optionality to a potential rise in the gold
price”, added Mr. Boyd.
Under the proposed Transaction, Agnico Eagle wi ll acquire 100% of CMC's Canadian
exploration assets located in Ontario and Quebec, other than CMC's interests in Canadian
Malartic GP and the Canadian Malartic mine. CMC's principal Canadian exploration assets
include the Kirkland Lake and the Hammond Reef Gold projects, as well as additional mining
claims and assets located in Ontario and Quebec. The Kirkland Lake project covers
approximately 27,291 hectares in northeastern Ontario and mineral reserves and mineral
resources have been outlined on several properties. Key deposits in the Kirkland Lake area
include: Upper Beaver, Anoki and McBean, Amalgamated Kirkland (AK) and Upper Canada.
Hammond Reef is an advanced stage gold project covering approximately 31,145 hectares
in northwestern Ontario. The project contains well defined mineral resources.
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Additional details on the mineral reserves and mineral resources being acquired by Agnico
Eagle are presented in the table at the end of the news release.
In connection with the proposed Transaction, Agnico Eagle, CMC and Yamana have
entered into an asset purchase agreement (the " Agreement"). The parties have agreed to
work expeditiously towards cl osing of the Transaction, which is anticipated to occur by
March 31, 2018 in respect of those assets which CMC can then convey with subsequent
closings thereafter as CMC obtains the requisite consents to transfer. The Transaction is
subject to notification under the Competition Act (Canada) and the receipt of government,
First Nations and other third party consents. Under the Agreement, if Agnico Eagle sells any
of the Kirkland Lake and Hamm ond Reef properties during the 24 month period f rom the
date of the Agreement, Yamana will participate in any increase in net proceeds received by
Agnico Eagle in the sale.
About Agnico Eagle
Agnico Eagle is a senior Canadian gold mining company that has produced precious metals
since 1957. Its eight mines are located in Canada, Finland and Mexico, with exploration and
development activities in each of these countries as well as in the United States and
Sweden. Agnico Eagle and its shareholders have full exposure to gold prices due to its long-
standing policy of no forward gold sales. Agnico Eagle has declared a cash dividend every
year since 1983.
Further Information
For further information regarding Agnico Eagle, contact Investor Relations at
[email protected] or call (416) 947-1212.
Forward-Looking Statements
The information in this news release has been prepared as at December 21, 2017. Certain
statements in this news release, referred to herein as "forward- looking statements",
constitute "forward- looking statements" within the meaning of the United States Private
Securities Litigation Reform Act of 1995 and "forward- looking information" under the
provisions of Canadi an provincial securities laws. When used in this news release, the
words "anticipate", "could", "estimate", "expect", "forecast", "future", "indicate", "plan",
"possible", "potential", "will" and similar expressions are intended to identify forward-looking
statements. Such statements include, without limitation: statements relating to Agnico
Eagle's acquisition of CMC's Canadian exploration properties and the closing timing and
arrangements for the proposed Transaction; information concerning estimates of mineral
reserves and mineral resources and similar information; statements as to the projected
exploration and development of the projects, including estimates of exploration,
development and production and other costs and estimates of the timing of such exploration,
development and production or decisions with respect to such exploration, development and
production; statements regarding the Company's, Yamana's or CMC's ability to obtain the
necessary consents and authorizations in connection with the proposed transaction. Such
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statements reflect the Company's views as at the date of this news release and are subject
to certain risks, uncertainties and assumptions, and undue reliance should not be placed on
such statements.
Forward-looking statements are necessarily based upon a number of factors and
assumptions that, while considered reasonable by Agnico Eagle as of the date of such
statements, are inherently subject to significant business, economic and competitive
uncertainties and contingencies. Many factors, known and unknown, could cause actual
results to be materially different from those expressed or implied by suc h forward-looking
statements. Readers are cautioned not to place undue reliance on these forward- looking
statements, which speak only as of the date made. Other than as required by law, Agnico
Eagle does not intend, and does not assume any obligation, to update these forward-looking
statements.
Scientific and Technical Data
The scientific and technical information contained in this news release relating to the
Kirkland Lake and Hammond Reef projects has been approved by Alain Blackburn, Eng.,
Senior Vice- President, Exploration and Daniel Doucet , Eng. , Senior Corporate Director,
Reserve Development. Each of them is a "Qualified Person" for the purposes of National
Instrument 43-101 Standards of Disclosure for Mineral Projects ("NI 43-101").
NOTES: Mineral reserves are not a subset of mineral resources. Tonnage amounts and
contained metal amounts presented in this table have been rounded to the nearest
thousand, so aggregate amounts may differ from column totals. Please refer to the
Company press release dated February 15, 2017 and the Company’s Annual Information
Form for the year ended December 31, 2016, for further details on mineral reserves and
mineral resources. The scientific and technical information regarding the mineral reserve
and mineral resource estimates set out in this table has been approved by Daniel Doucet,
Eng., Senior Corporate Director, Reserve Development of the Company, a "qualified
person" as defined by NI 43-101.
As of December 31, 2016
GOLD OWNERSHIP 000 tonnes g/t 000 oz Au 000 tonnes g/t 000 oz Au 000 tonnes g/t 000 oz Au
Upper Beaver (underground) 50% - - - 3,996 5.43 698 3,996 5.43 698
Total 50% - - - 3,996 5.43 698 3,996 5.43 698
COPPER OWNERSHIP 000 tonnes % tonnes Cu 000 tonnes % tonnes Cu 000 tonnes % tonnes Cu
Upper Beaver (underground) 50% - - - 3,996 0.25 9,990 3,996 0.25 9,990
Total 50% - - - 3,996 0.25 9,990 3,996 0.25 9,990
GOLD OWNERSHIP 000 tonnes g/t 000 oz Au 000 tonnes g/t 000 oz Au 000 tonnes g/t 000 oz Au 000 tonnes g/t 000 oz Au
Hammond Reef (open pit) 50% 82,831 0.70 1,862 21,377 0.57 389 104,208 0.67 2,251 251 0.74 6
Kirkland Lake projects
Upper Beaver (underground) 50% - - - 1,818 3.45 202 1,818 3.45 202 4,344 5.07 708
AK (underground) 50% - - - 634 6.51 133 634 6.51 133 1,187 5.32 203
Anoki/McBean (underground) 50% - - - 934 5.33 160 934 5.33 160 1,263 4.70 191
Subtotal Kirkland Lake Projects 50% - - - 3,386 4.54 494 3,386 4.54 494 6,793 5.04 1,102
Total 50% 82,831 0.70 1,862 24,763 1.11 883 107,594 0.79 2,745 7,044 4.89 1,108
COPPER OWNERSHIP 000 tonnes % tonnes Cu 000 tonnes % tonnes Cu 000 tonnes % tonnes Cu 000 tonnes % tonnes Cu
Upper Beaver (underground) 50% - - - 1,818 0.14 2,567 1,818 0.14 2,567 4,344 0.20 8,642
Total 50% - - - 1,818 0.14 2,567 1,818 0.14 2,567 4,344 0.20 8,642
PROJECTS MINERAL RESOURCES
MEASURED INDICATED MEASURED AND INDICATED INFERRED
PROJECTS MINERAL RESERVES
PROVEN PROBABLE PROVEN & PROBABLE
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The mineral reserve and mineral resource estimates in this table represent the 50% portion
being acquired by Agnico Eagle. CMC owns and manages the Upper Beaver, AK and
Anoki/McBean projects in Kirkland Lake, northeastern Ontario, and the Hammond Reef
project in northwest Ontario. The mineral reserve estimate for the Upper Beaver project as
of December 31, 2016 used the following assumptions: US$1,200 per ounce gold; US$2.75
per pound copper; a foreign exchange rate of C$1.25 per US$1.00; and a C$125/tonne net
smelter return (NSR) cut -off value. The mineral resource estimates for the Upper Beaver
project used an NSR cut -off of C$95/tonne, which represents approximately 75% of the
mineral reserve cut -off value. The mineral resource estimate for the AK project used the
following assumptions: US$1,200 per ounce of gold; operating cost of US$80 to
US$100/tonne; and a cut -off grade of 2.5 g/t gold. The mineral resource estimate for the
Anoki/McBean project used the following assumptions: US$1,200 per ounce of gold;
operating cost of US$120/tonne; and a cut -off grade of 2.5 g/t gold. The mineral resource
estimate for the Hammond Reef project used the following assumptions: US$1,400 per
ounce of gold; operating cost of US$11.27/tonne; and a cut-off grade of 0.32 g/t gold for the
West Pit, and 0.34 g/t gold for the East Pit.
Notes to US Investors Regarding Mineral Reporting Standards
Each of Agnico Eagle and CMC prepare their mineral reserve and mineral resource
estimates in accordance with the requirements of securities laws in effect in Canada, which
differ from the requirements of US securities laws. Terms relating to mineral resources and
mineral reserves in this news release are defined in accordance with NI 43-101 under the
guidelines set out in the Canadian Institute of Mining, Metallurgy, and Petroleum Standards
on Mineral Resources and Mineral Reserves. For United States reporting purposes , the
SEC applies different standards in order to classify mineralization as a reserve. As a result,
the definitions of proven and probable reserves used in NI 43-101 differ from the definitions
in the SEC Industry Guide 7. In addition, the SEC does not recognize the terms "measured
resources", "indicated resources" and "inferred resources". Investors are advised that while
those terms are recognized and required by Canadian regulations, the SEC does not
recognize them. Investors are cautioned not to assume that any part or all of mineral
deposits in these categories will ever be converted into mineral reserves . "Inferred mineral
resources" have a great amount of uncertainty as to their existence, and great uncertainty
as to their economic and legal feasibility. It cannot be assumed that all or any part o f an
inferred mineral resource will ever be upgraded to a higher category. Under Canadian rules,
estimates of inferred mineral resources may not form the basis of feasibility or pre-feasibility
studies, except in rare cases. Investors are cautioned not to assume that any part or all of
an inferred mineral resource exists, or is economically or legally mineable.