Osisko Gold, Franco-Nevada acquire gold stream on SolGold project in Ecuador

Osisko Gold’s (NYSE) wholly-owned subsidiary Osisko Bermuda, in partnership with Franco-Nevada Barbados, a wholly-owned subsidiary of Franco-Nevada (FNV), has entered into a definitive Purchase and Sale Agreement with SolGold and certain of its wholly-owned subsidiaries with reference to gold production from SolGold’s 100%-owned Cascabel copper-gold project in Ecuador. Osisko also holds a 0.6% NSR royalty on Cascabel which it purchased from SolGold in 2022. OBL and FNB will make initial deposits totaling $100M to SolGold in three equal tranches to fund the Project’s pre-construction costs. The first tranche of the Pre-Construction Deposit will be funded at closing, with the two subsequent tranches subject to the achievement of key development milestones. Thereafter, the Stream Purchasers will make additional deposits totaling $650M to SolGold to fund construction costs once the Project is fully financed and further derisked. OBL will provide 30% of the Deposit in exchange for a 30% interest in the Gold Stream and FNB will provide 70% of the Deposit in exchange for a 70% interest in the Gold Stream. The 2024 pre-feasibility study for the Project’s Alpala deposit estimates total production over an initial 28-year mine life of 2.9 million tons of copper, 6.9 million ounces of gold and 18.4 million ounces of silver at an all-in sustaining cost of 69c per pound of copper. Annual deliveries to OBL over the initial 28-year mine life are expected to average approximately 12,000 gold equivalent ounces, including an average of approximately 23,000 GEOs per annum for the first 10 years. OBL will make initial cash deposits totaling $30M to SolGold to fund pre-construction costs of the Project. OBL will provide additional deposits to SolGold totaling $195M to fund construction costs of the Project, subject to conditions including execution by SolGold of an Investment Protection Agreement with the Government of Ecuador.