Orla Mining (TSX: OLA)
Announced that it has entered into a definitive arrangement agreement with Contact Gold Corp. (TSX-V: C) whereby Orla will acquire all of the issued and outstanding common shares of Contact pursuant to a court-approved plan of arrangement.
Contact’s land is adjacent to Orla’s South railroad project in Nevada.
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Pony Creek
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| Orla Mining | TSX : OLA |
| Stage | Development |
| Metals | Gold |
| Market cap | C$1.28 billion @ C$4.07 |
| Location | Zacatecas, Mexico + Nevada + Panama |
Pony Creek Property Located Directly Adjacent to Orla’s South Railroad Project
Vancouver, BC – February 26, 2024 – Orla Mining Ltd. (TSX: OLA; NYSE: ORLA) (“Orla” or the “Company”) is pleased to announce that it has entered into a definitive arrangement agreement (the “Arrangement Agreement”) with Contact Gold Corp. (TSX-V: C) (“Contact”) whereby Orla will acquire all of the issued and outstanding common shares of Contact (the “Contact Shares”) pursuant to a court-approved plan of arrangement (the “Transaction”).
Contact’s key asset is the 100%-owned Pony Creek property, a 4,500 hectare exploration land package, strategically located adjacent to Orla’s South Railroad property in the heart of the Carlin trend in Nevada.
Contact also owns the Green Springs property located in the southern end of the Cortez trend. Green Springs is an early-stage exploration project where Centerra Gold currently has a right to earn into 70% of the project through completion of a four-year, $10.0 million exploration program.
Transaction Terms
Under the terms of the Arrangement Agreement, each holder of Contact shares will receive, for each Contact share held (a “Contact Share”), 0.0063 of an Orla common share (each whole share, an “Orla Share”) (the “Arrangement Consideration”), for total consideration of $0.03 per Contact Share (based on Orla’s closing price on February 23, 2024), representing a total purchase price of approximately US$8.1 million.
The Arrangement Consideration represents a 77% premium based on Orla’s and Contact’s 20-day volume weighted average price (“VWAP”) as of February 23, 2024. Following the completion of the Transaction, Contact shareholders will own approximately 0.7% of the issued and outstanding Orla Shares.
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Acquisition Highlights and Transaction Rationale
- Consolidates landholdings adjacent to Orla’s core growth project, South Railroad, which hosts 1.6 moz of mineral reserves at 0.77 g/t Au, 1.8 moz of measured and indicated mineral resources at 0.74 g/t Au, and 719 koz of inferred mineral resources at 1.00 g/t Au.
- Pony Creek boasts existing resources that have potential to add oxide, transition and sulphide to the resource at South Railroad; three mineralized zones with an inferred mineral resource totaling 433,000 oz at 0.52 g/t Au.
- Enhances Orla’s strategic footprint in Nevada, specifically along the prolific Carlin trend. The addition of Pony Creek will complement Orla’s control of the southern part of the Railroad Mining District, representing a natural and seamless expansion of the South Railroad property.
- Contact’s Pony Creek has a similar geology, structural setting, and mineralization style as South Railroad, providing drill-ready targets, including extensions of known deposits and new targets. Significant exploration potential exists in both the Pony Creek and Green Springs land packages as both projects have been historically underfunded and are underexplored.
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Jason Simpson, President and CEO, Orla Mining
“This transaction strengthens our land position in Nevada along the Carlin trend.
“Contact’s Pony Creek property is a valuable complement to our South Railroad Project, one our key growth opportunities.
“We look forward to making the necessary investments to unlock the combined potential of this now larger, contiguous and highly prospective land package.”
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To read the full news release, please click HERE
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If you need clarification of any information contained in this note, or have any questions, I will be delighted to assist – Please email andrew@city-investors-circle.com
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Disclosure
At the time of writing the author holds shares in Orla Mining.
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