By Robb M. Stewart
Osisko Gold Royalties is teaming up with Canadian miner Franco-Nevada to secure gold produced at SolGold's Cascabel copper-gold project located in Ecuador.
Osisko, which in 2022 bought a 0.6% net smelter return royalty on Cascabel, on Monday said it and Franco-Nevada will make initial deposits totaling $100 million to SolGold in three equal tranches to fund the project's pre-construction costs. The pair will make additional deposits totaling $650 million to fund construction costs once the project is fully financed and further derisked, it said.
Osisko said its Bermuda subsidiary will provide 30% of the deposit in exchange for a 30% interest in the gold Stream from Cascabel and Franco-Nevada's Barbados unit will provide 70% of the deposit for a 70% stake.
Cascabel has the potential to become a multi-generational copper-gold mine. A prefeasibility study this year estimated total production over an initial 28-year mine life of 2.9 million metric tons of copper, 6.9 million ounces of gold and 18.4 million ounces of silver, based on plans to exploit just 18% of the measured and indicated mineral resources of one deposit.
Write to Robb M. Stewart at robb.stewart@wsj.com
(END) Dow Jones Newswires
07-15-24 0726ET