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September 2, 2022

Barrick Gold signs $60m deal to offload royalty portfolio to Maverix

The sale includes 22 royalties on the production of minerals from mines in the Americas, Australia and Africa.

Barrick Gold has agreed to divest a portfolio of royalties to Maverix Metals for an overall consideration of up to $60m.

The deal includes a $50m upfront cash consideration and a contingent consideration of up to $10m, based on certain events occurring.

Under the agreed terms, Barrick Gold will sell 22 royalties on the production of minerals from mines in South America, North America, Australia and Africa.

The contingent payments include $6m if the operator of the Eskay Creek project in British Columbia secures permits needed to start mine construction within six years of closing, as well as $2m upon Maverix receiving payments from the portfolio, excluding the Eskay Creek royalty, equal to or over $10m within six years from deal closing.

It also includes another $2m upon Maverix securing payments from the portfolio, excluding the Eskay Creek royalty, equal to or more than $20m within six years from the closing of the deal.

The transaction is planned to be completed at the end of the third quarter of 2022.

Maverix CEO Dan O’Flaherty said: “This portfolio boasts significant existing attributable mineral inventory with meaningful exploration potential in historic mining geographies.”

O’Flaherty said that the acquisition will increase the firm’s portfolio to 147 royalties and streams while enhancing its exposure to the next generation of gold mines.

In a separate announcement, Nevada Gold Mines, a joint venture between Barrick Gold (61.5%) and Newmont (38.5%), agreed to divest a portfolio of royalties in Nevada, US, to Gold Royalty in a $27.5m deal.

The portfolio includes three royalties on the production of minerals from the Granite Creek and Bald Mountain projects in Nevada.

Gold Royalty will issue 9,393,681 of its common shares to fulfil the total consideration of $27.5m to Nevada Gold Mines.

Upon completion of the deal, NGM will own a 7% stake in Gold Royalty on a pro forma basis.

Gold Royalty chairman and CEO David Garofalo said: “Granite Creek commenced underground mining earlier this year and we are encouraged by the high-grade potential of the project to deliver significant returns in the future. The Bald Mountain royalties provide Gold Royalty exposure to exploration upside on one of the largest private mining land packages in the US.”

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