Grande Portage Announces Binding Commercial Offtake Agreement with C$6 Million Equity Financing and US$25 Million Construction Loan, Welcomes Ocean Partners as New Strategic Catalyst for the New Amalga Gold Project
Grande Portage Resources Ltd. (TSXV: GPG) has entered into binding term sheets with Ocean Partners UK Limited to establish a strategic partnership for the New Amalga Gold Project. The agreement includes a $6 million equity investment, a USD$25 million construction loan, and a seven-year commercial offtake agreement. The transaction utilizes a direct-shipping ore model, which eliminates the need for an onsite processing plant and tailings facility, thereby significantly reducing capital expenditures, operating costs, and regulatory complexity.
Under the terms of the equity investment, Grande Portage will raise $6 million at $0.45 per unit. Each unit comprises one common share and one-half of one common share purchase warrant. The warrants carry an exercise price of $0.60 per share with a 24-month term. An acceleration clause dictates that the warrants will automatically expire if TSXV shares close at $0.70 or higher for five or more consecutive trading days. Share and warrant holders are subject to a 24-month contractual hold period on all issued securities, subject to customary exceptions, in addition to a standard four-month statutory hold period.
The financing package also includes a construction loan and overrun facility of up to USD$25 million, subject to formal documentation and the achievement of funding and development milestones. The loan carries a 24-month term from initial drawdown, with availability commencing within six months of commercial production. Repayment begins after a nine-month grace period, followed by 15 equal monthly installments. Interest is priced at 12-month SOFR plus 7%, with a 1% early repayment fee.
A binding term sheet for a commercial offtake agreement covers up to 100% of production for the first seven years of commercial operation. The agreement includes flexible termination rights and defined metal payabilities and deductions designed to optimize economic studies. Net proceeds from the transaction will be allocated to development activities, study work, permitting activities, working capital, and general corporate purposes. The partnership positions Ocean Partners as the company’s second-largest shareholder and provides financial certainty ahead of the targeted 2031 production date.
Grande Portage is currently in the second year of comprehensive environmental studies for the project. The company intends to formally initiate the U.S. federal NEPA review process in early 2027 and targets all state and federal authorizations by mid-2029, followed by construction and initial production in 2031.
The New Amalga Gold Project holds an NI 43-101 Mineral Resource Estimate effective July 17, 2024, which reports 1,438,500 oz Indicated Au @ 9.47 g/t (4.726M tonnes) and 515,700 oz Inferred Au @ 8.85 g/t (1.813M tonnes), alongside associated silver resources.
Ian Klassen, CEO of Grande Portage, stated, "We are delighted to advance this partnership with Ocean Partners. Moving to a Definitive Commercial Offtake Agreement solidifies our mutual recognition and commitment to responsible development at the high-grade New Amalga Gold Project in Southeast Alaska. This is strong validation of our project's robust economics as outlined in our recently filed PEA and our vision to develop the mine using a direct-ship platform."
Brent Omland, CEO of Ocean Partners, added, "We are delighted to forge this important partnership with Grande Portage Resources. Their New Amalga Gold project has all the right ingredients for success: a direct shipping ore platform that avoids an onsite processing plant and tailings facility to minimize CAPEX and expedite permitting, an expandable high-grade gold resource, and the potential for rapid return on investment capital."