Nomad Royalty Company (TSX: NSR) announced this morning that it has entered into an agreement to acquire 5.938% of the gold production of the Greenstone gold project. The transaction is reported to be paid in cash totaling US$95 million.
Under the agreement, Nomad Royalty will be entitled to 5.938% of the gold production until the total delivery reaches 120,333 gold ounces, then 3.958% thereafter. This royalty will come from the 40% equity interest of Orion Mine Finance in Greenstone Gold Mines, the project’s operator.
Per the transaction, Nomad Royalty is expected to fund an advance deposit of US$95 million, US$13.3 million of which is expected by Q4 2021 and the remaining US$81.7 million no later than June 30, 2023. The initial deposit is conditional on, among other things, a second amended and restated limited partnership agreement between Orion Mine and Greenstone Gold, and Orion Mine entering into a senior credit facility.
Throughout the royalty agreement, Nomad Royalty is expected to pay 20% of the spot gold price for each ounce of refined gold delivered. In addition, the firm is also paying US$30 per gold ounce to support ESG programs by Greenstone Gold.
Greenstone Gold is a 60-40 partnership of Equinox Gold and Orion Mine. Recently, Equinox Gold announced the groundbreaking of the gold mine construction at the property, with a target first gold pour in H1 2024.
Nomad Royalty last traded at $9.41 on the TSX.
Information for this briefing was found via Sedar and the companies mentioned. The author has no securities or affiliations related to this organization. Not a recommendation to buy or sell. Always do additional research and consult a professional before purchasing a security. The author holds no licenses.
