TORONTO,
Dec. 22, 2014 /PRNewswire/ -
AuRico Gold Inc. (TSX: AUQ) (NYSE: AUQ), ("AuRico" or the
"Company") today announced that it has entered into an agreement
with Crocodile Gold providing for termination of the deferred cash
payment arrangement with Crocodile Gold that was previously
established in 2012 and its replacement with a revised agreement
that provides both parties with a more satisfactory and mutually
beneficial arrangement. Completion of the transaction is subject to
final approval from the Foreign Investment Review Board ("FIRB") of
Australia.
Under the terms of the previous arrangement,
AuRico was entitled to receive deferred cash payments based on net
free cash flow derived from the Fosterville and Stawell gold mines. Under the
new agreement, Crocodile Gold will pay AuRico C$20 million in cash immediately upon closing and
will grant AuRico a net smelter return ("NSR") royalty of 2% from
Fosterville Gold Mine and 1% from Stawell Gold Mine.
"AuRico is pleased with the revised agreement as
it immediately monetizes potential future payments by securing a
significant C$20 million upfront
payment while retaining potential upside through the NSR
arrangement", stated Scott Perry,
President and CEO of AuRico
Gold.
About AuRico
Gold
AuRico Gold is a
leading Canadian gold producer with mines and projects in
North America that have
significant production growth and exploration potential. The
Company is focused on its core operations including the cornerstone
Young-Davidson gold mine in northern Ontario, and the El Chanate mine in Sonora
State, Mexico. AuRico's project
pipeline also includes the advanced development Kemess Underground
Project in northern British
Columbia and the Lynn Lake Gold Camp in northern
Manitoba. The Company also has
other exploration opportunities in Canada and Mexico. AuRico's head office is located in
Toronto, Ontario, Canada.
Cautionary Statement
This press release contains forward-looking
statements and forward-looking information as defined under
Canadian and U.S. securities laws. All statements, other than
statements of historical fact, are forward-looking statements. The
words "expect", "believe", "anticipate", "will", "intend",
"estimate", "forecast", "budget" and similar expressions identify
forward-looking statements. Forward-looking statements include
estimates of mineral grades, the estimated extent and timing of
anticipated future exploration activity; the results of future
interpretation of geological information; whether results thereof
will lead to estimated reserves or resources and the timing of such
estimates , information as to strategy, plans or future financial
or operating performance, such as the Company's expansion plans,
project timelines, production plans, projected cash flows or
capital expenditures, cost estimates, projected exploration
results, reserve and resource estimates and other statements that
express management's expectations or estimates of future
performance.
Forward-looking statements are necessarily based
upon a number of factors and assumptions that, while considered
reasonable by management, are inherently subject to significant
uncertainties and contingencies. Known and unknown factors could
cause actual results to differ materially from those projected in
the forward-looking statements. Such factors include without
limitation: receiving Foreign Investment Review Board of
Australia approval related to the
transaction, estimates of mineral grades; the estimated extent and
timing of future exploration activity and resource estimates;
the interpretation of geological information; whether exploration
results will lead to establishing reserves or resources; the nature
and timing of permitting work; the risk that projects will not be
developed accordingly to established budgets or timelines; no
material delays in the timing for completion of exploration
activities, changes in laws or regulations in Canada, Mexico and other jurisdictions in which the
Company may carry on business; risks of obtaining necessary
licenses, permits; authorizations or approvals for operations or
projects such as Kemess; contests over title to properties; the
speculative nature of mineral exploration and development; risks
related to aboriginal title claims; compliance risks with respect
to current and future environmental regulations; fluctuations in
the price of gold and foreign exchange rates; the uncertainty of
replacing depleted reserves; the risk that the Young-Davidson and El Chanate mine may not perform
as planned; uncertainty of production and cost estimates;
disruptions affecting operations; opportunities that may be pursued
by the Company; employee relations; availability and costs of
mining inputs and labor; the ability to secure capital to execute
business plans; volatility of the Company's share price; any
decision to declare dividends; the implementation and continued
availability of the dividend reinvestment plan; the effect of
future financings; litigation; risk of loss due to sabotage and
civil disturbances; the values of assets and liabilities based on
projected future cash flows; risks arising from holding derivative
instruments; risks arising from the absence of hedging; adequacy of
internal control over financial reporting; changes in our credit
rating; and the impact of inflation.
Actual results and developments are likely to
differ, and may differ materially, from those expressed or implied
by the forward-looking statements contained herein. There is no
assurance or certainty that an initial resource estimate for
Kemess East will be completed, or if completed, is completed
in early 2015. Such statements are based on a number of assumptions
which may prove to be incorrect, including assumptions about:
future exploration and the results of such exploration, the ability
and timing to complete a resource estimate for Kemess East, the
presence of and continuity of metals at Kemess East at
modeled grades, business and economic conditions; commodity
prices and the price of key inputs such as labour, fuel and
electricity; credit market conditions and conditions in financial
markets generally; revenue and cash flow estimates, production
levels, development schedules and the associated costs; our ability
to procure equipment and supplies in sufficient quantities and on a
timely basis; the timing of the receipt of permits and other
approvals for our projects and operations; our ability to attract
and retain skilled employees and contractors for our operations;
the accuracy of our reserve and resource estimates; the impact of
changes in currency exchange rates on our costs and results;
interest rates; taxation; and our ongoing relations with our
employees and business partners.
The Company disclaims any intention or
obligation to update or revise any forward-looking statements
whether as a result of new information, future events or otherwise,
except as required by applicable law.
SOURCE AuRico Gold Inc.