Contango ORE Acquiring More Alaska Gold Prospects

Titaro notes that Contango is expecting to generate cash soon, now that the Manh Choh deposit is producing its first gold as a 70/30 joint venture with Fort Knox owner Kinross Gold Corporation. “We are of the opinion that this acquisition will enhance their future production growth strategy, which Avidian will participate in and greatly benefit from its share ownership,” Titaro states.

If Avidian shareholders approve the transaction, Titaro says the Toronto-based company will be debt-free and hold a clean balance sheet, along with cash and marketable securities, at current equity prices, of around $3 million Canadian dollars, not including the potential future upside payment of $1 million if a production decision is reached. “Avidian will then focus on a value creation strategy for its 100 percent owned Jungo gold-copper project in Nevada and continue ongoing evaluation of a number of possible strategic opportunities/alternatives that could be transformational for the company,” Titaro says.

Both Avidian’s and Contango’s boards of directors have unanimously approved the transaction. Avidian’s annual shareholder meeting is scheduled for July 4. The transaction could close soon after.

Contango owns a 30 percent interest in the Manh Choh gold project, while Kinross acts as manager and operator. Mining started at Manh Choh last August, and transport of the ore to the Fort Knox mill began in November. Additional ore arrives daily to the stockpile, and first gold production is planned for the second half of 2024. Annual production is expected to be 225,000 ounces, and 30 percent, or approximately 67,500 ounces, is credited to Contango’s account.

Contango is also exploring the Lucky Shot project near Hatcher Pass and, through its subsidiary, has 100 percent ownership of approximately 8,000 acres of peripheral State of Alaska mining claims.