Tudor to acquire American Creek, boosting gold project stake to 80%

Tudor currently owns 60% of Treaty Creek, which hosts a large gold-copper porphyry system alongside several other mineralized zones across a 179-sq.-km land package. The property borders Seabridge Gold’s KSM — the world’s largest undeveloped gold-copper project — to the southwest and Newmont’s Brucejack property to the southeast. The remaining 40% interest is split evenly between American Creek and Teuton Resources (TSXV: TUO).

Under a letter of intent signed last week, Tudor will acquire American Creek by issuing shares on a 0.238-for-1 basis, which, based on spot prices, represents a premium of 40%. This would increase its stake in the project to 80%.

American Creek’s shares jumped 9.1% to C$0.12 at Tuesday’s open, with a market capitalization of approximately C$52 million ($38 million). Tudor fell about 1.8% to C$0.54 apiece, giving it a C$139.6 million ($102 million) market capitalization.

Following completion of the merger, American Creek shareholders would own approximately 30% of the combined company.

“Our acquisition of American Creek cements our interest in the Treaty Creek project, which hosts one of the largest gold discoveries in Canada with excellent potential for expansion and additional gold-copper discoveries, at a reasonable per ounce of gold equivalent cost,” Tudor Gold CEO Joe Ovsenek said in a press release.

“We also believe that through the consolidation of our two companies that operating costs will be more efficient and Tudor will be better positioned to secure future exploration and development capital,” American Creek’s CEO Darren Blaney added.

The Treaty Creek project is anchored by the Goldstorm copper-gold-silver deposit that has an indicated mineral resource of 27.9 million oz. in gold-equivalent and an inferred resource of 6 million oz. With these estimates, Goldstorm is considered to be one of the largest gold discoveries in the last 30 years, Tudor said.

Before Tudor’s involvement in the project, Treaty Creek already had a rich exploration history that can be traced back to the late 1920s. Still, complete records of exploration activity can only be found for the 1980s, when Teuton, led by Ed Kruchkowski, staked the claims and made several discoveries through option agreements.

Tudor took on the project in 2016 to follow up on prior work by American Creek, leading to the Goldstorm discovery that year.