Breakwater Resources will takeover Metco Resources in an all-scrip deal worth just over C$11.8 million based on Breakwater’s closing price at the end of last week.

The deal gives Metco shareholders exposure to the potential offered by Breakwater’s portfolio, and allows Breakwater to consolidate its land position in the Lebel-sur-Quévillon camp in Canada, gain entry into a large and prospective land package in the Matagami camp and also secure additional feed for its Langlois mill.

In Lebel-sur-Quévillon, Metco and Breakwater have a 50:50 joint venture on properties extending over 15 km (186 claims, 3,402 ha) in the same deformation corridor as Breakwater’s current deposits.

The companies also share 50:50 the Orphée Deposit where a two phase 14,000 m diamond drill program in 36 holes was completed early in November last year.

In Matagami, Metco owns the Caber and Caber North deposits. In July last year, Metco released a prefeasibility study, which determined that the Caber deposit contained Probable mineral reserves of 589,000 t at an average grade of 8.58% Zn, 0.84% Cu, 8.89 g/t Ag and 0.13 g/t Au.

The prefeasiblity study assumed truck haulage a distance of 38 km to railhead in Matagami then by rail for a further 110 km to Breakwater’s Langlois mill. The Caber deposit contains an additional Inferred resource of 171,000 t at an average grade of 8.4% Zn, 1.3% Cu, 11 g/t Ag and 0.17 g/t Au.

The Caber North deposit, located 1.2 km from the Caber deposit, contains Inferred resources of 2.6 Mt at an average grade of 4.26% Zn, 1.59% Cu and 21.06 g/t Ag.

Metco’s exploration properties in Matagami extend for some 60 km along the prospective west flank where the Key Tuffite horizon has been intersected in many locations.

The properties include the wholly-owned Galinée property (217 claims, 3,451 ha) and La Gauchetière property (8 claims, 128 ha) as well as properties explored in a 50:50 joint venture with SOQUEM, namely Du Dôme-Matagami, B6-20 McIvor, Caber and Samson (493 claims, 19,922 ha).

Metco also owns three base metal properties (89 claims, 1,815 ha) in Rouyn-Noranda and one (1) gold property (36 claims, 735 ha) in Chibougamau. In the Gaspé Peninsula, Metco has a joint venture with Regal Consolidated Ventures on the Mont de l’Observation copper property (399 claims, 22,283 ha).