Metals Company enters strategic partnership with Low Carbon Royalties

TMC announced a strategic partnership with Low Carbon Royalties, or LCR, to finance the development and production of low-carbon fuels and energy transition metals. TMC and LCR have agreed to a purchase and sale agreement whereby LCR has acquired a 2% gross overriding royalty on any future revenue derived from TMC’s NORI area in the Clarion Clipperton Zone of the Pacific Ocean. In consideration for the NORI Royalty, TMC received a 35% strategic equity interest in LCR and $5M cash. TMC will retain the right to repurchase up to 75% of the NORI Royalty at an agreed capped return, exercisable in two transactions, between the second and the tenth anniversary of the agreement. If both repurchase transactions are executed, LCR’s remaining gross overriding royalty on the NORI project revenue will be 0.5%. The NORI Royalty has been added to the LCR portfolio that contains a 1.6% gross overriding royalty on a producing natural gas field in Latin America, providing exposure to a lower-carbon transition fuel aligned with government emissions reduction policies. LCR is committed to expanding its portfolio of assets to deliver a new source of funding to producers of low-carbon energy and energy transition metals while delivering the high shareholder returns typical of the revenue royalty business model.