North American Palladium to Acquire Cadiscor Resources

North American Palladium (NAP) and Cadiscor Resources announced a definitive agreement in late March 2009 whereby NAP will acquire Cadiscor in an all-share transaction. Cadiscor’s main asset is the Sleeping Giant underground mine and milling facilities, located about 80 km north of Amos, Quebec, in the province’s Abitibi region. Cadiscor acquired the mine from Iamgold in 2008. A feasibility study released in October 2008 identified sufficient mineral reserves to operate for 16 months at a rate of 52,000 oz/y of gold and mineral resources that could potentially double the mine life. Cadiscor’s other significant asset is its Discovery gold project, located 70 km from Sleeping Giant. A scoping study released in August 2008 outlined a project that could produce an average of 44,000 oz/y of gold over a fouryear mine life.

The transaction requires approval of two-thirds of Cadiscor shareholders at a special meeting scheduled to be held in May. Cadiscor shareholders would own about 14% of NAP upon completion of the transaction.

Coincident with the signing of the agreement, NAP advanced Cadiscor $7.5 million pursuant to the purchase of a $5.4 million, 12% convertible debenture and a $2.1 million, 12% debenture. Cadiscor will use the proceeds of these transactions to bring the Sleeping Giant mine back into production.

NAP placed its Lac des Iles mine in Ontario on care and maintenance in October 2008 due to low metal prices. Prior to the temporary shutdown, the mine had annual production of 270,000 oz of palladium, 20,000 oz of platinum, and 20,000 oz of gold. The mine hosts measured and indicated mineral resources of 3.7 million oz of palladium, 300,000 oz of platinum and 250,000 oz of gold, and can be quickly restarted upon a renewed strengthening of metal prices.

As featured in Womp 2009 Vol 04 - www.womp-int.com