Royal Gold Congratulates Centerra Gold on its Acquisition of Thompson Creek
October 20 2016 - 04:30PM
Business Wire
Amended Streaming Agreement Maintains Royal
Gold’s Economic Interest at Mount Milligan
Royal Gold, Inc. (NASDAQ: RGLD) (together with its
subsidiaries, “Royal Gold” or the “Company,” “we” or “our”) notes
that Centerra Gold Inc. (“Centerra”) and Thompson Creek Metals
Company Inc. (“Thompson Creek”) have completed the Plan of
Arrangement (the “Arrangement”), pursuant to which Centerra
acquired all of the issued and outstanding common shares of
Thompson Creek. As previously announced, Royal Gold’s streaming
interest at Mount Milligan has been amended (the “amendment”)
concurrently with closing of the Arrangement.
Under the terms of the amendment, Royal Gold’s 52.25% gold
stream at Mount Milligan has been converted to a 35% gold stream
and 18.75% copper stream. Royal Gold will continue to pay US$435
per ounce of gold delivered and will pay 15% of the spot price per
metric tonne of copper delivered. Royal Gold estimates this
amendment to be value-neutral on a discounted cash flow basis.
In conjunction with the amendment, Royal Gold’s first ranking
security over 52.25% of gold produced from the Mount Milligan
assets has been amended to provide for first ranking security over
35% of produced gold and 18.75% of produced copper. Royal Gold’s
other existing security over the Mount Milligan assets remains
unaffected.
Mount Milligan gold in concentrate that is currently in transit
will be delivered to Royal Gold under the current 52.25% stream.
Under the terms of both the original and amended agreements, there
is a maximum of five months between concentrate shipment and final
settlement, and Royal Gold expects to begin receiving gold and
copper deliveries reflecting the amended stream agreement in
approximately March 2017.
On October 18, Thompson Creek announced that commissioning of
major equipment and components of the Mount Milligan permanent
secondary crushing circuit had begun. Routine testing and
commissioning of all equipment and process circuits will continue
over the next several weeks, with first feed through the secondary
crusher expected by the end of October. Thompson Creek noted that
capital expenditures for the project are expected to be $50 - $55
million, approximately $10 million below their prior guidance.
CORPORATE PROFILE
Royal Gold is a precious metals stream and royalty company
engaged in the acquisition and management of precious metal
streams, royalties and similar production based interests. The
Company owns interests on 193 properties on six continents,
including interests on 38 producing mines and 24 development stage
projects. Royal Gold is publicly traded on the NASDAQ Global Select
Market under the symbol “RGLD.” The Company’s website is located at
www.royalgold.com.
Cautionary “Safe Harbor” Statement Under the Private
Securities Litigation Reform Act of 1995: With the exception of
historical matters, the matters discussed in this press release are
forward-looking statements that involve risks and uncertainties
that could cause actual results to differ materially from
projections or estimates contained herein. Such forward-looking
statements include statements about Centerra’s acquisition of
Thompson Creek Metals Company, Royal Gold’s amended stream
agreement, the estimated economic value of the amended stream
agreement, and Royal Gold’s security position related to Mount
Milligan. Factors that could cause actual results to differ
materially from the projections include, among others, precious
metals and copper prices; performance of and production at the
Company's stream and royalty properties, including gold and copper
production at Mount Milligan; Centerra’s operation of Mount
Milligan as anticipated; events that could cause our discounted
cash flow analysis of the amended stream to be inaccurate; the
ability of operators of development properties to finance project
construction to completion and bring projects into production as
expected; operators’ delays in securing or inability to secure
necessary governmental permits; decisions and activities of the
operators of the Company's stream and royalty properties;
unanticipated grade, environmental, geological, seismic,
metallurgical, processing, liquidity or other problems the
operators of the mining properties may encounter; changes in
operators’ project parameters as plans continue to be refined;
changes in estimates of reserves and mineralization by the
operators of the Company’s stream and royalty properties; contests
to the Company’s stream and royalty interests and title and other
defects to the Company’s stream and royalty properties; errors or
disputes in calculating stream and royalty payments, or payments
not made in accordance with stream and royalty agreements; economic
and market conditions; risks associated with conducting business in
foreign countries; changes in laws governing the Company and its
stream and royalty properties or the operators of such properties,
and other subsequent events; as well as other factors described in
the Company's Annual Report on Form 10-K, Quarterly Reports on Form
10-Q, and other filings with the Securities and Exchange
Commission. Most of these factors are beyond the Company’s ability
to predict or control. The Company disclaims any obligation to
update any forward-looking statement made herein. Readers are
cautioned not to put undue reliance on forward-looking
statements.
Statement Regarding Third Party Information: Royal Gold
does not own, develop or mine the properties on which it holds
stream or royalty interests. Certain information has been provided
to us by the operators of those properties or is publicly available
information filed by these operators with applicable securities
regulatory bodies, including the Securities and Exchange
Commission. Royal Gold has not verified, and is not in a position
to verify, and expressly disclaims any responsibility for, the
accuracy, completeness or fairness of such third-party information
and refers the reader to the public reports filed by the operators
for information regarding those properties.
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version on businesswire.com: http://www.businesswire.com/news/home/20161020006496/en/
Royal GoldKarli Anderson, 303-575-6517Vice President
Investor Relations
Royal Gold (NASDAQ:RGLD)
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