Prince George, B.C. -   The Blackwater gold mine project, 150 km south-southwest of Vanderhoof could be on line in 5 or six years. That is the word of the CEO of New Gold, which just entered into an agreement with Richfield Ventures Corp.  to purchase the asset from Richfield.

 

The Blackwater project is  a gold deposit   that is  estimated to have 1.8 million ounces of indicated gold resources, and 2.0 million ounces of inferred gold resources.

 

New Gold will likely have it’s New Afton mine near Kamloops in production next year and says it could look towards developing the Blackwater project in the not too distant future.  

"The Richfield team has done a tremendous job in advancing the project to this point and we are excited to now move forward with it. With New Afton in British Columbia on track to begin production in mid-2012, we will be well positioned to deploy both the team and cash flow from New Afton to move the Blackwater Project through continued exploration, development and ultimately into production ," stated Randall Oliphant, New Gold Executive Chairman.

 

The project area covers 23,670 hectares, with Richfield owning 100% of the southern claims and 75% of the adjacent northern claims. Silver Quest Resources Ltd. owns the remaining 25% of the northern Davidson claims.

 

New Gold is paying $550 million in shares for the Richfield properties.

 

The acquisition is expected to be completed by way of a court approved plan of arrangement. The transaction is expected to close in June 2011.

 

 “I am thrilled by this win-win transaction for both Richfield’s shareholders and those of New Gold. The Blackwater Project will be in excellent hands with New Gold, a proven mine builder and operator, that has the financial capacity and the exploration and development expertise to continue to expand and ultimately develop the gold resources at Blackwater,” said Peter Bernier, Richfield President and Chief Executive Officer.