$95 Million Gold Stream with Orion Mine Finance This news release constitutes a "designated news release" for the purposes of Nomad's prospectus supplement dated June 22, 2021, to its short form base shelf prospectus dated September 30, 2020
MONTREAL, Oct. 29, 2021 /CNW Telbec/ - Nomad Royalty Company Ltd. ("Nomad" or the "Company") (TSX : NSR) (NYSE: NSR) is pleased to announce that it has entered into a gold purchase agreement ("Gold Stream") with a subsidiary of Orion Mine Finance ("Orion" or "Seller") with respect to its 40% interest in the Greenstone Gold Mines LP ("GGM"), which is the owner and operator of the Greenstone Gold Project located in Ontario, Canada (the "Greenstone Project"). Nomad will make up-front cash payments totalling $95 million for 5.938% of gold production attributed to Orion's 40% interest in GGM until 120,333 ounces have been delivered, and 3.958% thereafter. As part of the Gold Stream, Nomad has made a long-term commitment to funding mine-level environmental, social and governance ("ESG") programs by agreeing to make payments to GGM equal to $30 per ounce of gold delivered to Nomad. For further clarity, the Gold Stream does not encumber Equinox Gold Corp's 60% interest in GGM or the Greenstone Project. All figures quoted herein are in United States dollars unless otherwise indicated.
"The addition of the Greenstone Gold Stream strengthens our portfolio and adds near-term production from a fully permitted project located in Ontario, a premier mining jurisdiction," commented Vincent Metcalfe, Nomad's CEO. "This transaction is consistent with Nomad's strategy of building a cash flow focused precious metals royalty and stream portfolio."
"We are very pleased to partner with Orion on its portion of the Greenstone Project. Through the Gold Stream, Nomad is excited and proud to make a life-of-mine financial commitment to support GGM's environment and community-based programs," further commented Joseph de la Plante, Nomad's CIO.
TRANSACTION HIGHLIGHTS (Shown on a 100% basis, of which Orion owns 40%)
- Highlights Nomad's expertise and ability to execute high-quality streaming transactions
- Demonstrates Nomad's commitment to supporting ESG initiatives through a life-of-mine financial commitment to GGM to support mine-level environment and community-based programs
- Adds a Tier 1 gold stream on a top-tier mine to Nomad's portfolio
- One of Canada's largest gold mines with 5.54 million ounces in proven and probable mineral reserves grading 1.27 grams per tonne gold1
- Conventional large-scale open-pit operation1
- Ontario, Canada is one of the world's best mining jurisdictions
- 5.05 million ounces life-of-mine gold1 on at average all-in-sustaining costs of $618 per ounce2
- More than 400,000 ounces average annual gold production for the first five years1
- More than 360,000 ounces average annual gold production over the life of mine1
- Furthers Nomad's strategy of investing in near-term production
- Project is fully permitted and full-scale construction is underway1
- First gold pour targeted for H1 20241
- Significant underground and near-mine exploration upside potential1
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| 1 Sources: Press release of Equinox Gold Corp. dated October 27, 2021, a copy of which is available on Equinox Gold Corp's profile on SEDAR at www.sedar.com. |
| 2 Sources : Management's discussion and analysis of Equinox Gold Corp. for the three and six months ended June 30, 2021, a copy of which is available on Equinox Gold Corp's profile on SEDAR at www.sedar.com. |
TERMS OF THE AGREEMENT
- Advance Deposit: Nomad to fund an advance deposit of $95 million to Orion, of which $13.3 million is expected to be advanced in Q4 2021 (the "First Deposit") and $81.7 million is expected to be advanced no later than June 30, 2023 (the "Second Deposit"). Funding of the First Deposit is conditional upon, among other things, (i) Orion and the other partners of GGM entering into a second amended and restated limited partnership agreement of GGM on or before November 30, 2021; (ii) Orion entering into a senior credit facility on or before November 30, 2021; (iii) a formal construction decision has been made with respect to the Greenstone Project; and (iv) the first drawdown by Orion under it senior credit facility. Funding of the Second Deposit by Nomad shall be conditional upon, among other things, a second drawdown by Orion under its senior credit facility
- Gold Stream: Under the Gold Stream, Nomad will be entitled to delivery of 5.938% of gold production attributed to Orion's 40% interest until 120,333 ounces of gold have been delivered, and 3.958% thereafter
- Cash Payment: Nomad will pay the Seller an ongoing payment, at the time of each delivery, equal to 20% of the spot gold price for each ounce of refined gold delivered under the Gold Stream
- ESG Financial Commitment: Life-of-mine financial commitment to make ongoing cash payments to GGM equal to $30 per ounce of gold delivered under the Gold Stream to support ESG programs implemented by GGM at the Greenstone Project
- Exploration Upside: The Gold Stream on Orion's 40% interest applies to all mining claims, mining leases and other similar mining rights currently comprising the Greenstone Project, including the Hardrock, Brookbank, Key Lake and Kailey deposits and will also apply to potential future upside at the existing orebodies and prospective targets that may be acquired in the future within the Gold Stream area of interest