Freeport to take 51% of TDG's Aurora West near AuRORA find

Freeport-McMoRan (NYSE: FCX) has agreed to pay TDG Gold (TSXV: TDG; US-OTC: TDGGF) C$110 million ($77 million) in cash for 51% of the Aurora West property in British Columbia's Toodoggone district, close to the JOY district where Freeport and Amarc Resources (TSXV: AHR; US-OTC: AXREF) are exploring the AuRORA copper-gold discovery.

The Vancouver-based explorer said on Thursday that it had signed a binding agreement with a Freeport subsidiary. Before closing, TDG will move Aurora West into two new British Columbia companies: ClaimsCo, which will hold two specified mineral claims, and Aurora West JVCo, which will hold the rest of the property. Freeport will buy 51% of each and TDG will keep 49%. TDG's Shasta and Baker properties are excluded.

Freeport can lift its stake in Aurora West JVCo to 75% and in ClaimsCo to 100% by sole-funding another $80 million of spending on the JVCo ground and paying TDG $40 million for its remaining ClaimsCo shares. It has committed to fund $30 million of that spending within three years of closing, at least $15 million of it in the first two years. TDG does not have to contribute during the earn-in.

If Freeport exercises the option, TDG would hold 25% of Aurora West JVCo and a 2% net smelter returns royalty over the two ClaimsCo claims. If Freeport stops after the committed amount, it keeps 51% and the partners fund pro rata. A partner diluted to 10% or less would swap its shares for a 2% royalty, half of which Freeport could buy back for $30 million.

"On closing, the C$110 million cash payment strengthens our treasury on a non-dilutive basis and improves our ability to advance Shasta," TDG chief executive Fletcher Morgan said in a statement.

Morgan also pointed to operational synergies from Aurora West's proximity to Shasta, a gold-silver deposit TDG calls its flagship project.

At cost

The deal also involves the Freeport-Amarc partnership. Under their August 2025 shareholders agreement, any claims either partner acquires that fall fully or partly within 2 km of the property of AuRORA Minerals Ltd., the JOY joint venture company, are to be offered to that company at cost, Amarc said on Thursday. TDG's drilling at Aurora West has focused on ground well within that area, it said.

AuRORA Minerals is owned 60% by Freeport and 40% by Amarc, and Freeport operates JOY. Freeport is earning a further 10% by funding $75 million of Stage 2 spending, of which about $40 million to $45 million has been funded so far.

Freeport must fund the first estimated $30 million to $35 million of the cost of acquiring the area-of-interest claims through the remaining spending it needs to reach 70%, Amarc said. Once Freeport holds 70%, Amarc pays 30% of the joint venture's costs, including any consideration for those claims.

Amarc is awaiting formal notice from Freeport, after which it will have at least 45 days to elect to have the claims contributed to AuRORA Minerals. It raised $20 million in a private placement in September.

Amarc president and chief executive Diane Nicolson described consolidating the area-of-interest claims as "a necessary step in the ultimate development of this emerging district."

Freeport-McMoRan has not issued its own release on the deal.

TDG expects to complete the reorganization in December, with closing five business days after conditions, including TSX Venture Exchange approval, are met or waived. It does not expect to need shareholder approval.