Hackett River is already one of the largest undeveloped volcanogenic massive sulphide (VMS) deposits in the world and is analogous to the Kidd Creek and Noranda deposits which have been prolific large producing mines for decades.

Hackett River is a silver- rich VMS deposit located 45 km west of Sabina's flagship Back River Gold Project in Nunavut.

Hackett River Silver Royalty

In order to focus on its flagship Back River Gold Project, Sabina sold Hackett River to Xstrata Zinc Canada in exchange for $50 million in cash and the retention of a significant silver royalty on future production. Under the terms of the Agreement, Sabina retains a royalty of 22.5% of the first 190 million ounces of silver payable from the project and surrounding claims and 12.5% of the silver payable thereafter. Sabina retained the Wishbone claims at the south east of the belt covering geological units which are analogous to Back River. Xstrata has committed to spending $50 million in exploration over a four year period and to complete a bankable feasibility study. Sabina has a right to use any regional infrastructure built by Xstrata on commercial terms.

Based on Sabina's 2009 PEA on Hackett River the royalty would deliver to Sabina approximately 2.7 million ounces of silver annually for 16 years.

The transaction created significant value for Sabina shareholders by:

  • Providing capital needed to advance Back River;
  • Maintaining significant precious metal exposure to Hackett River at no additional cost through a large silver royalty;
  • Bringing a large, experienced mine developer and operator to the region in Xstrata; and
  • Improving the likelihood of significant infrastructure improvements in the region that a large VMS mining operation will require.

With Xstrata, the world's largest zinc producer, taking the reins at Hackett, Sabina shareholders as well as other stakeholders in Nunavut have a tremendous opportunity to realize significant value.

Mr. Angus Campbell, P. Geo. and Vice-President, Exploration for Sabina Gold & Silver Corp. is a Qualified Person under the terms of NI 43-101 and has reviewed and approved the technical content of this website.