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TSX/NYSE-listed Newmont Goldcorp continues to streamline its asset base by entering a binding agreement to sell the Red Lake complex to Evolution Mining.

Upon closing of the transaction, expected in the first quarter of 2020, Newmont will receive $375 million in cash and contingent payments of up to an additional $100 million tied to new resource discoveries.

“This transaction both strengthens our balance sheet and provides ongoing exposure to new discoveries at Red Lake,” says Newmont Tom Palmer, president and CEO.

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“Evolution is a highly respected and responsible gold producer who is committed to the success of Red Lake and who we believe will prove a great partner for surrounding communities and stakeholders.”

Under terms of the $100 million contingent payment, Evolution will pay Newmont $20 million for each one million ounces of new gold resources added to the existing Red Lake resource base over a fifteen year period.

The contingent payment is applicable to the first 5 Moz of new resources.

Newmont intends to use proceeds from the transaction to support the company’s capital allocation priorities of returning cash to shareholders, maintaining an investment-grade balance sheet, and investing in a world-class portfolio.

Evolution Mining is a leading, growth-focused Australian gold producer. Evolution operates five wholly-owned mines – Cowal in New South Wales, Cracow, Mt Carlton and Mt Rawdon in Queensland, and Mungari in Western Australia.

Newmont has the strongest and most sustainable portfolio of operations, projects and exploration prospects in the gold sector.

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These assets allow the company to sequence profitable projects in its unmatched pipeline to sustain gold production over a decades-long time horizon.