Nomad Royalty (NSR) has signed a $95m agreement to acquire a 40% stake in the Greenstone Gold Mines (GGM) from a subsidiary of Orion Mine Finance.
GGM owns and operates the Greenstone Gold Project in Ontario, Canada.
According to the gold stream deal, Nomad will pay $95m in two upfront cash instalments to Orion.
Nomad will deliver 5.938% of gold production from the Greenstone Gold Project, attributed to Orion’s 40% interest. This will be effective until the delivery of 120,333oz of gold, and 3.958% thereafter.
Furthermore, Nomad will pay an ongoing payment to the seller. This will be equal to 20% of the spot gold price for each delivery of refined gold ounce.
Nomad also agreed to fund mine-level environmental, social and governance (ESG) programmes under the gold stream.
In a press statement, the firm said: “For further clarity, the Gold Stream does not encumber Equinox Gold’s 60% interest in GGM or the Greenstone Project.”
Nomad CEO Vincent Metcalfe said: “The addition of the Greenstone Gold Stream strengthens our portfolio and adds near-term production from a fully permitted project located in Ontario, a premier mining jurisdiction.
“This transaction is consistent with Nomad’s strategy of building a cash flow focused precious metals royalty and stream portfolio.”
The gold and silver royalty company said that the gold stream on Orion’s 40% stake will be applicable for all mining leases, mining claims, and other mining rights involving the Greenstone Project.
GGM is a 60/40 joint venture between Equinox Gold and Orion Mine Finance.
Construction recently commenced on the $1.23bn Greenstone gold mine project, which is expected to produce over 400,000oz of gold a year for the first five years.
According to estimates, the mine holds proven and probable mineral reserves of 5.54Moz, in grading 1.27g/t gold.