Teck Resources signs deal to sell Turkish gold projects to Alamos Gold

By The Canadian Press

VANCOUVER, B.C. - Teck Resources Ltd. (TSX: TCK-B.TO) and Fronteer Development Group. Inc. (TSX: FRG.TO) have signed a deal to sell its stake in two gold projects in Turkey to Alamos Gold Inc. (TSX: AGI.TO) in a deal worth about $84 million.

Under the deal announced Wednesday, Alamos will pay US$40 million and issue four million shares to Teck and Fronteer in exchange for the Agi Dagi and Kirazli gold projects.

Alamos president and chief executive John McCluskey said Turkey is an emerging gold producing country with low political risk.

"This potential acquisition represents significant upside for Alamos shareholders as we are also acquiring a dominant land position in a mineral-rich district that contains high-sulphidation epithermal gold deposits," McCluskey said in a statement,

"The company's existing gold operations in the Mulatos District of Mexico are also based upon high-sulphidation epithermal gold deposits, from which we will be able to leverage our geological expertise and heap-leach operating and mine-building experience."

Teck holds a 60 per cent interest in the projects, while Fronteer holds the remaining 40 per cent.

Agi Dagi and Kirazli are advanced-stage gold exploration projects in the Biga mineral district in northwestern Turkey.

Alamos Gold shares closed down 24 cents at $10.24 on the Toronto Stock Exchange, while Fronteer shares were down eight cents at $4.83. Teck shares closed down 37 cents at $30.17.

Teck has been selling assets in recent months to help repay debt built up from the acquisition of Fording Canadian Coal Trust last fall.

Teck did the deal by borrowing nearly US$10 billion. Weeks after the deal was announced commodity prices tanked as a result of the global recession, leaving the company scrambling to cut costs and reduce its debt more quickly as credit markets were in turmoil.