OBL will make an upfront cash payment to TCM totaling US$20 million, with the proceeds to be used to fund the development of the Trixie Mine and Tintic Property
Osisko signs binding agreement with respect to the previously announced metals stream on the Trixie Mine in Utah’s historic Tintic mining district. (Credit: swm/Freeimages)
Osisko Gold Royalties Ltd (the “Corporation” or “Osisko”) (OR: TSX & NYSE) is pleased to announce that its wholly-owned subsidiary, Osisko Bermuda Limited (“OBL”) has entered into a binding agreement with Tintic Consolidated Metals LLC (“TCM”), an indirect wholly-owned subsidiary of Osisko Development Corp. (“ODV”) (ODV: TSX-V & NYSE), with respect to the previously announced metals stream (the “Stream”) on the Trixie test mine (the “Trixie Mine”), as well as mineral claims covering more than 17,000 acres in Central Utah’s historic Tintic Mining District (the “Tintic Property”).
STREAM DETAILS
- Upfront Deposit: OBL will make an upfront cash payment to TCM totaling US$20 million, with the proceeds to be used to fund the development of the Trixie Mine and Tintic Property.
- Streamed Metal: OBL will purchase 2.5% of all metals produced from the Tintic Property until 27,150 ounces of refined gold have been delivered. Thereafter, OBL will purchase 2.0% of all metals produced from the Tintic Property for the remaining life of mine.
- Production Payments: OBL will make ongoing payments for refined metal delivered to the Stream equal to 25% of the spot prices on the day prior to the date of delivery.
- Security: The Stream shall be a senior secured, first ranking obligation of ODV, inclusive of guarantees.
- Area of Interest: The Stream shall be referenced to production from the entire Tintic Property, including the Trixie Mine.
- Closing: The Stream is expected to close on or before July 31, 2022, subject to certain conditions precedent to closing, including, but not limited to, execution of all definitive agreements with respect to the Stream. The economic effective date of the transaction is May 29, 2022.
TRIXIE MINE DEVELOPMENT UPDATE
ODV’s near term plan is to initiate underground and at surface drilling while it continues exploration development and processing of the mineralized material at the Trixie Mine. Drilling is targeting support for preparation of an initial resource statement pursuant to National Instrument 43-101 over the next twelve months. Concurrently, ODV will complete advanced technical studies on the Tintic Property to generate additional surface and underground targets, conduct metallurgical testing, geotechnical work and environmental studies to justify further development as well as increase production through a low-capital expenditure expansion.
OSISKO OWNERSHIP INTEREST IN ODV
ODV announced today that is has closed its previously announced acquisition of a 100% interest in the Trixie Mine and Tintic Property, and satisfied the escrow release conditions relating to the previously announced issuances of subscription receipts of ODV (collectively the “Transactions”). Following completion of the Transactions, Osisko’s ownership interest in ODV is now approximately 45%.
Source: Company Press Release