COEUR D'ALENE, Idaho--(BUSINESS WIRE)--Hecla Mining Company's (NYSE:HL - News) subsidiary, Hecla Limited, has agreed to sell its interest in the Hollister Development Block gold exploration project in Nevada to its partner, Great Basin Gold, Inc., for a total of $60 million, including $45 million in cash and $15 million in Great Basin Gold common stock. The number of shares is to be determined by the average trading price 20 business days prior to the announcement of the transaction.
Hecla President and Chief Executive Officer, Phillips S. Baker, Jr., said, "We believe Hollister is a good project for us if we owned all of it, but when split in half, it is just not large enough to make a significant impact on Hecla's production, revenue or income. It is a better strategy to focus our people and financial resources on projects that have a much larger impact on Hecla. At the same time, it gives our partners an opportunity to benefit from the project's full potential, so we feel it is a win/win proposition for both sides. Through our ownership of Great Basin Gold stock, we will continue to participate in the upside potential of the Hollister Block."
Hecla had spent approximately $30 million over the past two years developing the underground ramp and conducting underground exploration toward the earn-in requirement. Hecla had a current book value for the Hollister project of less than $1 million.
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