Queenston Announces Strategic Investment by Agnico-Eagle Mines Limited
TORONTO, ONTARIO -- (Marketwire) -- 10/28/10 -- QUEENSTON MINING INC. (TSX: QMI)(FRANKFURT: QMI)(STUTTGART: QMI)('Queenston' or 'the Company') is pleased to announce that Agnico-Eagle Mines Limited ('Agnico-Eagle') today entered into a Subscription Agreement with the Company to make a strategic investment of C$35 million dollars in Queenston by way of a non-brokered private placement of units. Both Boards have approved the transaction.
Under the terms of the Subscription Agreement Agnico-Eagle will purchase a total of 6,603,774 Units at C$5.30 per Unit for proceeds to Queenston of C$35 Million in cash. Each Unit consists of one common share and one half of a share purchase warrant of Queenston. Each whole share purchase warrant entitles the holder to purchase one common share of Queenston at $6.45 for a period of 36 months. The transaction is expected to close on November 1, 2010 and is subject to completion of definitive documentation and other customary closing conditions including regulatory approval. As a result of the private placement Agnico-Eagle will own 8.83% of Queenston's issued and outstanding shares and 11.47% on a fully diluted basis. In addition to the private placement Queenston and Agnico-Eagle will enter into a Technical Services Agreement that will provide Queenston access to Agnico-Eagle's geological and engineering mining team.
Queenston's principal assets are located in the historic Kirkland Lake gold Camp in northeastern Ontario. The camp has produced 40 million ounces of gold and Queenston maintains the largest land holdings in the district with approximately 20,000 hectares (200 km2). Queenston's primary focus is to return to producer status through the advanced exploration and development of five-100% owned gold deposits (Upper Beaver, Upper Canada, Anoki, McBean and Bidgood) to provide feed for a central milling facility to be built in Gauthier Twp.
Sean Boyd, Vice Chairman and CEO of Agnico-Eagle commented, 'This strategic investment is a strong indication of the quality and potential of Queenston's properties in the Kirkland Lake camp. This investment provides us exposure to a world class gold camp and is consistent with our strategy of investing in promising gold development opportunities. We look forward to using our exploration and mine development skills to assist Queenston in enhancing its gold resources and advancing their projects towards feasibility.'
Charles Page, President and CEO of Queenston said, 'We are very pleased with this investment from Agnico-Eagle, a company which has proven expertise in the development of both underground and open-pit mines. Proceeds from the private placement combined with the assistance of the Agnico-Eagle team provide Queenston the opportunity to advance our projects towards the development stage.'
Upon completion of this investment Queenston's cash position will be approximately $70 million. The Company has 14 drills operating in the Kirkland Lake camp focussed on mineral resource definition, advanced exploration and grass roots exploration.
Forward Looking Statements
Except for historical information this News Release may contain certain 'forward looking statements'. These statements may involve a number of known and unknown risks and uncertainties and other factors that may cause the actual results, level of activity and performance to be materially different from the Company's expectations and projections. A more detailed discussion of the risks is available in the 'Annual Information Form' filed by the Company on SEDAR at www.sedar.com.
Contacts:
Queenston Mining Inc.
Charles E. Page, P. Geo.
President and CEO
(416) 364-0001 (ext. 224)
Queenston Mining Inc.
Hugh D. Harbinson
Chairman
(416) 364-0001 (ext. 225)
Queenston Mining Inc.
Andreas Curkovic
Investor Relations
(416) 577-9927
Info@queenston.ca
www.queenston.ca