Elemental Altus To Acquire Gold Royalty Portfolio From First Mining
February 6, 2023 – Vancouver, BC: Elemental Altus Royalties Corp. (“Elemental Altus” or “the Company”) (TSX-V: ELE, OTCQX: ELEMF) announces that it has entered into a binding agreement (the “Agreement”) to acquire a portfolio of 19 royalties (the “Royalties”) from a wholly owned subsidiary of First Mining Gold Corp. (TSX:FF, OTCQX:FFMGF) (“First Mining”) for consideration of US$5,000,000 in cash and common shares (the “Acquisition”).
- 19 uncapped royalties acquired, significantly expanding the development pipeline including:
- 2.0% Net Smelter Return (“NSR”) royalty on the development stage Pickle Crow gold project in Ontario, Canada (“Pickle Crow”), one of the highest grade +2 million ounce gold deposits in the world, which has previously produced over 1.5 million ounces of gold
- 1.5% NSR royalty on the development stage Hope Brook gold project in Newfoundland, Canada (“Hope Brook”) which has previously produced approximately 0.75 million ounces of gold
- Substantially expands the Company’s North American royalty presence, with an additional five royalties in Canada and the United States
- Increases global royalty land coverage by 20% (1,500km2), bringing Elemental Altus’ royalty portfolio to over 75 royalties covering approximately 9,000km2
- To be funded by US$3,500,00 in cash and US$1,500,000 in equity
Frederick Bell, CEO of Elemental Altus, commented:
“The acquisition of this royalty portfolio materially expands our development pipeline in Canada. The Pickle Crow and Hope Brook projects are both former operating gold mines which have reportedly produced over 2.2 million ounces of gold historically and are currently the subject of extensive exploration and investment. The portfolio further expands our North American presence and is in line with our strategy of acquiring high-quality royalties. We are delighted to add meaningful ounces to our development pipeline on assets with clear pathways to medium-term production, supported by our peer group leading revenue and cost of capital advantage”.
|Pickle Crow||Auteco Minerals Ltd||Gold||Canada||Development||2.0% NSR1|
|Hope Brook||Big Ridge Gold Corp||Gold, Copper||Canada||Development||1.5% NSR2|
|Pompoi||Endeavour Mining plc||Gold||Burkina Faso||Exploration||1.5% NSR3|
|Joutel||Agnico Eagle and Maple Gold Mines||Gold||Canada||Exploration||1.0% NSR|
|Lac Virot||Ridgemont Iron Ore||Iron Ore||Canada||Exploration||2.0% NSR4|
|Morris||Maple Gold Mines||Gold||Canada||Exploration||1.0% NSR|
|Turquoise Canyon||Westward Gold Inc||Gold||USA||Exploration||2.0% NSR5|
|Hope Brook||Big Ridge Gold Corp||Aggregates||Canada||Development||US$1/t|
|11 Mexican Royalties||Private||Gold||Mexico||Exploration||2.0% NSR6|
Terms of the Acquisition
Elemental Altus has agreed to pay an aggregate of US$5.0 million in consideration for the royalties, satisfied through payment of US$3.5 million in cash and US$1.5 million of common shares based on the 20-day volume-weighted average price of shares traded on the TSX Venture Exchange prior to this announcement at a price of C$1.253. The shares issued to First Mining Gold will represent approximately 0.88% of the Company’s enlarged share capital and will be escrowed from trading for six months.
Key Royalties Acquired
Pickle Crow NSR Royalty (2.0% NSR)
Pickle Crow is a development stage gold project which is 100% owned by Auteco Minerals Limited (ASX:AUT) (“Auteco”). The project is located in the world-class greenstone lode gold Uchi sub province of Ontario, Canada.
Pickle Crow currently has a JORC 2012 Inferred Mineral Resource Estimate (“MRE”) of 2,230,000 ounces at 7.8 grams per tonne (“g/t”), based on a 3.5 g/t cut-off grade for Quartz Lodes and 2.0 g/t cut-off for Alteration Hosted (BIF). Since September 2020, Auteco has added 1,200,000 gold ounces of inferred resource at a discovery cost of US$12.59 per resource ounce. In June 2021, Auteco commenced a 50,000 metres diamond drill campaign following the success of its previous 45,000 metres drill campaign, 20,000 metres of which have yet to be incorporated into the MRE. Most of the MRE is around the previously mined underground quartz vein hosted deposits; however, a portion of the current MRE is attributed to gold hosted in previously overlooked Banded Iron Formations which are potentially amenable to open pit mining.
On the 2nd of February 2023, Auteco announced it received firm commitments from investors to raise approximately A$9,000,000 which will be used to fast-track exploration work focused on targeting new discoveries and continuing to step out on the existing resource.
Elemental Altus’ royalty covers 190km2 of the project’s total area including all current resources, historical workings, an existing and unused 225 tonne per day mill and several priority regional targets including Metcalf, Tarp Lake, Springer, East Pat and F Vein.
Historical mining at Pickle Crow was focused on mining the quartz-gold-tungsten veins, the largest of which was the No.1 Vein (900 metre surface strike, mined to >1,500 metres below surface). The site produced approximately 1,500,000 ounces of gold at an average grade of 16 g/t between 1935 and 1966. For more information on Pickle Crow, please visit https://www.autecominerals.com/
Hope Brook NSR Royalty (1.5% NSR)
Hope Brook is an advanced stage, high-grade gold project which is owned by Big Ridge Gold Corp. (TSX-V:BRAU) (“Big Ridge Gold”) that produced 752,162 ounces of gold from 1987 to 1997.
Hope Brook is located 85 kilometres east of Port aux Basques, Newfoundland. The 260km2 project, entirely covered by Elemental Altus’ royalty, has well maintained infrastructure on site including an operational 28-person camp, an 1,100-metre airstrip, ice-free docking facility and connection to the provincial electrical power grid via an on-site substation.
Hope Brook hosts an MRE totalling 844,000 ounces of gold at 4.77 g/t in the indicated category and a 110,000 ounces at 4.11 g/t in the inferred category, based on a 3.0 gram per tonne cut-off grade and a long-term gold price of US$1,200 per ounce.
Big Ridge Gold has announced plans to provide an update to the project MRE during H1 2023. The update is expected to be the first to include new drilling since 2014 and to include copper mineralization for future further economic study. Copper was historically processed at the Hope Brook mine. For more information on Hope Brook, please visit https://bigridgegold.com/
On behalf of Elemental Altus Royalties Corp.
CEO and Director
Elemental Altus is a proud member of Discovery Group. For more information please visit: www.discoverygroup.ca or contact 604-653-9464.
TSX.V: ELE | OTCQX: ELEMF | ISIN: CA28619K1093 | CUSIP: 28619K109
About Elemental Altus Royalties Corp.
Elemental Altus is an income generating precious metals royalty company with 11 producing royalties and a diversified portfolio of pre-production and discovery stage assets. The Company is focused on acquiring uncapped royalties and streams over producing, or near-producing, mines operated by established counterparties, as well as generating royalties on new discoveries. The vision of Elemental Altus is to build a global gold royalty company, offering investors superior exposure to gold with reduced risk and a strong growth profile.
Neither the TSX-V nor its Regulation Service Provider (as that term is defined in the policies of the TSX-V) accepts responsibility for the adequacy or accuracy of this press release.
1 Royalty on Pickle Crow is subject to a 1.0% partial buyback exercisable for US$2.5 million.
2 Royalty on Hope Book is subject to a 0.5% partial buyback exercisable for C$2.0 million.
3 Royalty on Pompoi is subject to full buyback for C$1.5 million.
4 Royalty on Lac Virot is subject to 1.0% partial buyback for C$1.0 million.
5 Royalty on Turquoise Canyon is subject to 1.0% partial buyback for US$1.0 million.
6 Royalties on 11 Mexican Projects are each subject to a full buyback for US$1.0 million.
Cautionary note regarding forward-looking statements
This news release contains certain “forward looking statements” and certain “forward-looking information” as defined under applicable Canadian securities laws. Forward-looking statements and information can generally be identified by the use of forward-looking terminology such as “may”, “will”, “should”, “expect”, “intend”, “estimate”, “anticipate”, “believe”, “continue”, “plans” or similar terminology.
Forward-looking statements and information include, but are not limited to, statements with respect to the date that the name change is expected to become effective, whether shareholders will be required by their broker to exchange their issued certificate for a new certificate or take any other action in connection to the name change, the Company’s ability to deliver a materially increased revenue profile with a lower cost of capital, the future growth, development and focus of the Company, and the acquisition of new royalties and streams. Forward-looking statements and information are based on forecasts of future results, estimates of amounts not yet determinable and assumptions that, while believed by management to be reasonable, are inherently subject to significant business, economic and competitive uncertainties and contingencies.
Forward-looking statements and information are subject to various known and unknown risks and uncertainties, many of which are beyond the ability of Elemental Altus to control or predict, that may cause Elemental Altus’ actual results, performance or achievements to be materially different from those expressed or implied thereby, and are developed based on assumptions about such risks, uncertainties and other factors set out herein, including but not limited to: the impact of general business and economic conditions, the absence of control over the mining operations from which Elemental Altus will receive royalties, risks related to international operations, government relations and environmental regulation, the inherent risks involved in the exploration and development of mineral properties; the uncertainties involved in interpreting exploration data; the potential for delays in exploration or development activities; the geology, grade and continuity of mineral deposits; the impact of the COVID-19 pandemic; the possibility that future exploration, development or mining results will not be consistent with Elemental Altus’ expectations; accidents, equipment breakdowns, title matters, labour disputes or other unanticipated difficulties or interruptions in operations; fluctuating metal prices; unanticipated costs and expenses; uncertainties relating to the availability and costs of financing needed in the future; the inherent uncertainty of production and cost estimates and the potential for unexpected costs and expenses, commodity price fluctuations; currency fluctuations; regulatory restrictions, including environmental regulatory restrictions; liability, competition, loss of key employees and other related risks and uncertainties. For a discussion of important factors which could cause actual results to differ from forward-looking statements, refer to the annual information form of Elemental Altus for the year ended 31 December 2021. Elemental Altus undertakes no obligation to update forward-looking statements and information except as required by applicable law. Such forward-looking statements and information represents management's best judgment based on information currently available. No forward-looking statement or information can be guaranteed, and actual future results may vary materially. Accordingly, readers are advised not to place undue reliance on forward-looking statements or information.