Gold Eagle strikes it rich with Goldcorp acquisition: Bruce channel discovery may be multi-ounce producer.

• Author: Ross, Ian
• Position: MINING

Goldcorp took a decidedly NIMBY attitude when rival Agnico-Eagle staked a share in a successful junior miner with a high-grade gold deposit on the doorstep of its Red Lake complex.

When Agnico-Eagle Mines Ltd made a surprise purchase of five per cent of Gold Eagle stock by investing $50 million this past summer and offering to help develop its Bruce Channel discovery, the Vancouver mining giant stepped in quickly.

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Goldcorp has sealed the deal to buy junior miner Gold Eagle Mines in a friendly $1.5 billion acquisition that consolidated the world's second biggest gold holdings along the Red Lake Trend for eight kilometres. The acquisition was finalized Sept. 25.

With only 500 hectares of island property, Gold Eagle is delivering a future mine at its high-grade Bruce Channel discovery project that is one of Canada's greatest gold finds, smack dab in the heart of the Red Lake camp.

The company is sitting on a small deposit with potentially rich tonnes that may be more than 6 million ounces.

Gold Eagle president Simon Lawrence says his company wasn't on the selling block and he wasn't fielding calls from any interested suitors. With $475.3 million in assets, they were preparing to sink the first 30 metres of an exploration shaft on McKenzie Island. "We were literally days away from blasting."

The company was well financed for an upcoming underground and surface drill program. The Agnico-Eagle bump-up improved their coffers to $148 million. And there were big plans for a $108 million mine-mill complex and a tailings facility.

A surface drilling exploration program expanding to the property's southwest is threatening to make the deposit even bigger.

Across the property line, Goldcorp has been drilling and watching a busy Gold Eagle since 2006, drilling more than 200 holes and steadily putting the Bruce Channel project together.

Lawrence says it was "shot in the arm" when Agnico-Eagle invested a significant amount to assist with advanced underground exploration. "The entry of Agnico-Eagle into this area opened a lot of people's eyes, including Goldcorp's."

The property is immediately west of Goldcorp's Red Lake and Campbell Mine complex, and is just southwest of an old producer, Goldcorp's Cochenour-Willans Mine, which closed in 1971.

Agnico-Eagle president and COO Eberhard Scherkus was familiar with the ground, having worked for another company when the Cochenor mine closed.

The currently operating high grade Red Lake mines...