Skip to content

Sale process begins of insolvent White River gold mine

Harte Gold granted creditor protection by court, Australia's Silver Lake Resources looks to take control of Sugar Zone Mine property
Harte Gold mine site 1
Harte Gold's Sugar Zone Mine, north of White River (Company photo)

A prospective new owner of White River's Sugar Zone Mine might not be determined until next spring, at the earliest.

So far, early front runner Silver Lake Resources of Australia has the inside track to acquire the underground operation. But things are looking bleak for common shareholders of Harte Gold.

Harte Gold, the insolvent owner of the three-year-old underground mine, announced late on December 7 that the Ontario Superior Court of Justice has granted the Toronto mining company's application to enter creditor protection under the Companies' Creditors Arrangement Act (CCAA).

The company now has protection for creditors for an initial period up to Dec. 16, the maximum permitted under the act. 

Harte's Sugar Zone Mine is 30 kilometres north of White River.  Approximately 260 people are on the payroll. The site and the exploration property is massive at more than 81,000 hectares. 

At an upcoming Dec. 16 hearing, Harte said in a news release that it will be asking the court for an extension of the stay period (protection from creditors) to March 31, 2022. 

The court today also approved an initial advance of $400,000 to Harte from the main prospective bidder, Silver Lake Resources of Perth, Australia, which assumed $65.6-million in debt owned to BNP Paribas. A second creditor, Appian Capital, is owed close to $29.4 million.

Silver Lake Resources reached a loan agreement this week with Harte Gold for $10.8 million. This special debtor-in-possession (DIP) financing is earmarked to keep the mine operating through the CCAA proceedings until a sale of the mine is completed, sometime in 2022.

At an upcoming Dec. 16 hearing, Harte will seek the court's approval of the DIP financing arrangement from Silver Lake and to begin a sales and investment solicitation process (SISP) to put out informational 'teaser' material and start compiling a list of prospective bidders for the mine.

Harte Gold wants the flexibility to use Silver Lake as a "stalking horse" bidder, a method of keeping any low-ball offers off the table and set up a competitive bidding process.   

According to court documents, an early sale process started last May when Harte kicked off a strategic review process to find a buyer.

Want to read more stories about business in the North? Subscribe to our newsletter.

By June, the company assembled a list of 241 potential buyers and investors who were sent informative packages along with five parties that had contacted Harte and its financial advisor.

Twenty-eight prospective bidders were granted access to the data room, four parties submitted non-binding bids by an Aug. 13 deadline. No binding offers were submitted.

The current management of Harte Gold will stay in place to run the day-to-day protection under court supervision.

FTI Consulting is the court-appointed insolvency trustee and it will monitor the company's business affairs and the SISP.

Sign up for the Sudbury Mining Solutions weekly newsletter here.

Earlier today, the Toronto Stock Exchange (TSX) suspended trading of Harte Gold's common shares and put the company under an expedited delisting review process. The TSX has advised Harte Gold that a meeting has been scheduled for December 15 to consider whether or not to delist the securities of the company.

To read all the CCAA files of Harte Gold and the CCAA proceedings, the documents are available at the monitor's website at

Those parties interested in participating in the bidding process are asked to contact the monitor at

push icon
Be the first to read breaking stories. Enable push notifications on your device. Disable anytime.
No thanks