Kirkland Lake Gold (NYSE: KL) and Newmont (NYSE: NO) say they have formed a strategic alliance for exploration and development opportunities around the Holt complex in Kirkland and the Newmont properties in Timmins, Ontario.
Newmont will pay US $ 75 million to Kirkland Lake to acquire an option on the mining and mineral rights associated with the Company’s Holt Mine property.
As a result of the agreement, Newmont expects to remove the approximately $ 350 million liability for the Holt royalty from its balance sheet and record a gain of approximately $ 275 million in net income from discontinued operations in its third quarter results.
The companies say they will also work together to identify more exploration opportunities around their land positions in the region.
Shares of both companies rose more than 6% in today’s trading, as gold prices jumped about 2% to their highest level in nearly a week.