16:28:02 EST Mon 06 Dec 2021
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i-80 Gold Corp
Symbol IAU
Shares Issued 233,064,019
Close 2021-10-15 C$ 3.36
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i-80 Gold closes acquisition of Ruby Hill mine

2021-10-18 07:31 ET - News Release

Mr. Ewan Downie reports


i-80 Gold Corp. has closed the Ruby Hill mine acquisition from Waterton Nevada Splitter LLC and Waterton Nevada Splitter II LLC. With the previously announced closing of the Lone Tree complex, the company has launched a Nevada-focused growth company. All currencies expressed as U.S. dollars unless otherwise stated.

Ruby Hill, which includes multiple deposits that collectively represent one of Nevada's largest gold, silver and base metal endowments, was acquired from Waterton, and i-80 has taken over operating the current open-pit mine. When combined with the acquisition of the Lone Tree and Buffalo Mountain gold deposits that were acquired from Nevada Gold Mines LLC (NGM), including certain processing infrastructure, i-80 Gold is one of the largest holders of gold and silver resources in the state and is positioned to become a prominent, stand-alone, growth-oriented gold producer. The company now embarks on its plan to advance multiple projects to production over the next several years.

Highlights of the transactions are as follows (see press release dated Sept. 7, 2021):

  • i-80 becomes one of the largest holders of gold and silver resources in Nevada:
    • 6.3 million ounces of overall measured plus indicated gold resources and 104.5 million ounces of overall measured plus indicated silver resource (256.6 million tonnes of 0.76 g/t Au and 12.7 g/t Ag);
    • 8.4 million ounces of overall inferred gold resources and 76.5 million ounces of overall inferred silver resources (228.3 million tonnes of 1.15 g/t Au and 10.4 g/t Ag);
  • Secures for i-80 the ability to process multiple types of gold-bearing mineralization at a centrally located and permitted processing facility situated on Interstate 80. The Lone Tree facility includes an autoclave, CIL (carbon in leach) mill, flotation mill and heap leach facility;
  • Interim processing agreements with NGM provide i-80 with the ability to immediately advance its project portfolio -- a test mining program at Granite Creek is under way, Buffalo Mountain is currently being permitted, and the company is advancing plans to commence an underground development program at McCoy-Cove;
  • Working to close financing arrangements totalling about $227-million (U.S.) with access a further $100-million complement the company's strong cash position. Major participants in the equity financing, which closed on Oct. 14, 2021, of about $102-million (U.S.) include NGM subscribing to acquire a 9.9-per-cent interest in i-80 through the private placement, Orion subscribing to top up to a 9.9-per-cent interest in i-80, and participation from several members of the board and management.

"The recent transactions to acquire Ruby Hill, Lone Tree and Buffalo Mountain not only make i-80 one of the largest holders of gold and silver resources in the United States, but also positions the company to become one of Nevada's most prominent producers with substantial processing infrastructure including an autoclave," stated Ewan Downie, chief executive officer of i-80. "We are now in a position to begin accelerating mine development at multiple sites with the interim processing agreements entered into with Nevada Gold Mines and will focus on executing our plan to build a mid-tier gold-producing company."

Ruby Hill acquisition

Ruby Hill represents one of Nevada's premier mining projects with existing production from the Archimedes open pit and a large property package that is host to multiple gold, gold/silver and polymetallic gold deposits, which collectively comprise one of the largest and highest-grade permitted gold deposits in Nevada:

  • Substantial open-pit gold and silver resources within the Mineral Point open-pit deposit:
    • 3.2 million ounces of gold and 97.5 million ounces of silver indicated resources within 203.2 million tonnes with an average grade of 0.49 g/t Au and 14.9 g/t Ag;
    • 1.9 million ounces of gold and 72.4 million ounces of silver inferred resources within 157.3 million tonnes with an average grade of 0.37 g/t Au and 14.3 g/t Ag;
  • High-grade gold mineralization at the Ruby Deeps deposit that remains wide open along strike to the north:
    • 1.59 million ounces of gold in inferred mineral resources of 8.2 million tonnes with an average grade of 6.02 g/t Au;
  • High-grade polymetallic mineralization has been defined within the Blackjack target that remains open along strike and at depth.

Pursuant to a membership interest purchase agreement with Waterton, on Oct. 15, 2021, the company acquired all of the membership interests of the Ruby Hill Mining Company LLC, which owns the Ruby Hill mine, for a purchase price of $75-million (U.S.) in cash and 3,191,358 i-80 common shares at closing (valued at $8-million (U.S.)), and future milestone payments of up to $67-million (U.S.). The milestone payments are subject to an early payment option that could reduce total milestone payments to $47-million (U.S.), and the company may satisfy a portion of the milestone payments with i-80 common shares under certain circumstances described in more detail in the Sept. 7 press release.

Ruby Hill includes an open-pit mine and related infrastructure (mill/heap leach) and is located immediately west of the town of Eureka proximal to Highway 50.

Multiple gold and polymetallic exploration targets exist on the property and i-80 will begin an aggressive exploration program beginning immediately. The company will begin permitting for the construction of a decline to access the high-grade Ruby Deeps deposit and the Blackjack zone with the intent of trucking refractory mineralization for processing at Lone Tree. Completion of the current mine plan at the Ruby Hill pit will continue with processing at the heap leach facility on the property. Ruby Hill also includes crushing and CIL processing infrastructure.

Acquisition financing

The company is continuing to work with Orion to complete the remaining $125-million financing package, which is expected to also close in the near term. The remaining Orion financing is contemplated to include a prepay gold loan, convertible loan and, at the election of i-80, an accordion feature of up to an additional $100-million. The financing is subject to completion of due diligence by Orion and the execution of definitive agreements.

Share capitalization

Following the financing and acquisitions, the current share capitalization of the company is 233,064,019 shares issued and outstanding.

About i-80 Gold Corp.

i-80 Gold is a well-financed Nevada-focused mining company with a goal of achieving mid-tier gold producer status.

Technical information

Tim George, PE, manager of engineering services, reviewed the technical and scientific information contained in this press release and is a qualified person within the meaning of National Instrument 43-101.

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