Metalla Royalty & Streaming Ltd Completes Acquisition of 5% Net Smelter Royalty on Castle Mountain Gold Mine in California
At closing, Metalla paid US $ 10 million in cash to the seller, with the remaining $ 5 million to be paid within 20 months of closing, bearing interest at 4% per annum.
() said it has now completed its previously announced acquisition, from an arm’s length vendor, of an existing 5% net smelter return royalty on the South Domes portion of the mine. gold from Castle Mountain in California – soon to be one of the largest gold producers in the United States. mines.
At closing, Metalla paid US $ 10 million in cash to the seller, with the remaining US $ 5 million to be paid within 20 months of closing, bearing interest at the rate of 4% per annum. As reported in September 2021, the Castle Mountain mine is owned by () Corp and the total royalty consideration was US $ 15 million in cash.
Metalla also announced that it has completed the previously announced drawdown of an additional C $ 3 million under its modified and updated existing convertible loan with Beedie Capital, which was used in part to fund this acquisition.
READ: Metalla Royalty & Streaming to Buy 5% Net Smelter Return Royalty on Castle Mountain Gold Mine in California
The C $ 3 million will bear interest at 8% per annum, with the remaining C $ 12 million available to the Company under the loan facility subject to collateral interest of 1.5% per annum.
This drawdown amount is convertible by Beedie into common stock of Metalla for C $ 11.16 each, which is based on a 20% premium above the 30-day volume weighted average price (VWAP) of the shares. of Metalla on the TSX Venture Exchange calculated in September. 30, this year.
On September 13, Brett Heath, CEO of Metalla, told investors: “The Castle Mountain Royalty provides Metalla shareholders with exceptional long-term exposure to a significant property operated by one of the industry’s leading operators.
“The 5% NSR covers the South Domes portion of the Castle Mountain Gold Mine, which will soon be one of the largest gold mines in the United States when the Phase 2 expansion is implemented. Metalla shareholders will earn a significant 5% NSR on the reserves and resources of nearly 2 million ounces of gold at a mine expected to produce over 200 Koz per year. “
Phase 1 at Castle Mountain is currently mined in the JSLA, Jumbo and Oro Belle pits with expected production of 30,000 to 40,000 ounces of gold per year. Phase 2, scheduled to begin in 2026 and includes South Domes, is expected to increase production to over 200,000 ounces of gold per year.
Castle Mountain is on track to become one of the largest gold mines in the United States with an expected annual production of 218,000 ounces and a total all-inclusive sustaining cost of US $ 858 / oz during the mine plan of phase 2 of 14 years.
The project currently has 4.2 million ounces (Moz) of gold reserves, of which South Domes covers gold reserves of 1.1 Moz. Equinox described the potential to expand the 2021 Feasibility Mineral Reserves pits to ultimately connect the JSLA and South Domes pits.
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