Sunday 23rd October 2016

Resource Clips

Chieftain signs US$60M Gold and Silver Purchase Agreement with Royal Gold

Resource Clips - essential news on junior gold mining and junior silver miningChieftain Metals Inc TSX:CFB announced the sale of 12.5% of payable gold and 22.5% of payable silver from its Tulsequah Chief Project in northwest BC to Royal Gold Inc TSX:RGL. The $60-million deal includes an initial $10-million payment on closing, with the rest paid over the development period of the project.

The agreement allows Royal to purchase 12.5% of payable gold for $450 an ounce up to 48,000 ounces and 22.5% of payable silver for $5 an ounce up to 2.78 million ounces. Once those amounts have been delivered, the interests will convert to 7.5% of payable gold for $500 an ounce and 9.75% of payable silver for $7.50 an ounce, or the prevailing market price of the metals, for the remainder of the mine life.

Conditions include the securing of financing and permitting. Royal Gold also receives right of first refusal on any future gold or silver production-based interests.

Chieftain President/CEO Victor Wyprysky commented, “We are pleased to enter into this transaction with Royal Gold on the first anniversary of our IPO. Royal Gold’s commitment to the company highlights the value of the Tulsequah Chief Deposit. This financing does not dilute shareholders and increases the project NAV. The purchase amount, achieved by monetization of a portion of our precious metals, demonstrates the value inherent in the project. This transaction is an important first component in the project financing for Tulsequah Chief development as we plan for mine construction commencement in 2012.”

Royal Gold President/CEO Tony Jensen remarked, “We are pleased to add the high-grade Tulsequah Chief Deposit to our portfolio, which is another asset with good exploration potential in an attractive geographical region. It will also fit well into our development pipeline with an estimated start-up in 2015, following Pascua-Lama and Mt. Milligan in the second half of calendar 2013.”

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Chieftain Metals Inc
Victor Wyprysky
or Jamie Frawley
Director of Corporate Communications

Royal Gold Inc
Karen Gross
VP and Corporate Secretary

Read feature story on Chieftain Metals Inc.

by Greg Klein

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