JUNIOR MINING

Goldcorp buys 12.9% interest in Osisko and Canadian Malartic gold project

Osisko's Canadian Malartic gold project, now under development in Quebec, has captured the attention of one of the world's largest gold miners, Goldcorp, which now owns nearly 13% of the junior explorer.

RENO, NV - 

Vancouver-based Goldcorp now holds a 12.9% interest in Osisko Mining, whose Canadian Malartic project is considered a hot prospect in Quebec's Abitibi gold camp, an area that has historically mined 60 million ounces of gold.

Goldcorp announced Monday it has acquired 8,462,500 common shares and 4,271,500 common shares purchase warrants of Montreal-based Osisko Mining (TSX: OSK) and now controls over 33,842,500 shares of the junior explorer. Each warrant is exercisable for a share of Osisko for Cdn$5.45/sh through November 17^th.

However, in a statement released Monday, Goldcorp said the company "has no present intention to increase its holdings in Osisko although it will evaluated the investment in Osisko and whether to increase or decrease its shareholdings in response to market conditions, the business and prospects of Osisko and other factors."

Osisko has 6.28 million ounces of proven and probable gold reserves at Canadian Malartic, as well as 3.65 million measured and indicated ounces of gold. Mining and milling equipment has already been purchased for delivery this year.

The Canadian Malartic gold deposit and adjacent mineralized zones are being developed into a large-scale open pit mining operation. The company asserts, "The Canadian Malartic deposit currently represents one of the biggest gold reserves in Canada for a single deposit, and is still growing through ongoing drilling on new mineralized zones.

It is anticipated that the US$789 million project will average 591,000 ounces of gold production over a 10-year mine life in a mining friendly jurisdiction. Total mine production is planned to be 150,000 tpd.

The project budget also includes US$87 million for the relocation of a neighborhood of 75 residences and advancement to near completion of a new elementary school, a day care facility and an adult training center.

The company reported nearly Cdn$400 million in cash and nearly Cdn$370 million in working capital as of June 30, 2009.

The explorer entered into a financing agreement with the Société générale de financement du Québec (SGF) for a Cdn$75 million, five year convertible debenture last month. It raised an additional Cdn$400 million in an equity financing in February. SGF is an industrial and financial holding company of the Government of Quebec.

Osisko is currently is discussion with several institutions and strategic investors to complete the project financing requirements.

During the second quarter of this year, Osisko reported a net loss of Cdn$5.8 million (negative 2-cents per share), compared to a loss of Cdn$1 million (negative 1-cent/sh) for the second quarter of 2008. For the first six months of this year, the company reported a loss of Cdn$6.6 million (negative 3-cents/sh), down from a net income of Cdn$3.7 million (2-cents/sh) for the first half of 2008.

The higher costs were attributed to an increase in activities as Osisko moves from "an exploration company towards an intermediate gold development and operating company."