Item 2. Properties
ITEM 2. PROPERTIES
We do not own or operate the properties on which we hold stream or royalty interests and therefore much of the information disclosed in this Form 10-K regarding these properties is provided to us by the operators. For example, the operators of certain properties provide us information regarding metals production, estimates of mineral reserves and additional mineralized material and production estimates. A list of our producing and development stage streams and royalties, as well their respective reserves, are summarized in Table 1 “Operators’ Estimated Proven and Probable Gold Reserves” below within this Item 2. More information is available to the public regarding certain properties in which we have stream or royalty interests, including reports filed with the SEC or with the Canadian securities regulatory agencies available at www.sec.gov or www.sedar.com, respectively.
We manage our business under two reportable segments, consisting of the acquisition and management of stream interests and the acquisition and management of royalty interests. The description of our principal stream and royalty interests set forth below includes the location, operator, stream or royalty rate, access and any material current developments at the property. For any reported production amounts discussed below, we consider reported production to relate to the amount of metal sales subject to our stream and royalty interests. Please refer to Item 7, MD&A, for discussion on production estimates, historical production and revenue for our principal properties. The map below illustrates the location of our principal producing stage properties.
In 2018, the SEC adopted amendments to the disclosure requirements for mining properties. Effective for fiscal years beginning on or after January 1, 2021, the disclosure requirements under SEC Industry Guide 7 have been replaced with new disclosure requirements under Regulation S-K Subpart 1300. The property and reserve disclosures as of June 30, 2021, contained in this report are presented in accordance with SEC Industry Guide 7. We expect that the property and reserve disclosures as of December 31, 2021, contained in our Transitional Report on Form 10-KT to be filed in early 2022 will be presented in accordance with Regulation S-K Subpart 1300.
Principal Producing Properties
We consider both historical and future potential revenues to determine which stream and royalty interests in our portfolio are principal to our business. Estimated future potential revenues from producing properties are based on a number of factors, including reserves subject to our stream and royalty interests, production estimates, feasibility studies, technical reports, metal price assumptions, mine life, legal status and other factors and assumptions, any of which could change and could cause us to conclude that one or more of such stream and royalty interests are no longer principal to our business.
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Currently, we consider the properties discussed below (listed alphabetically by stream and royalty interest) to be principal to our business.
Stream Interests
Andacollo (Region IV, Chile)
Our wholly owned subsidiary, RGLD Gold AG (“RGLD Gold”), owns the right to purchase 100% of the gold produced from the Andacollo copper-gold mine until 900,000 ounces of payable gold have been delivered, and 50% thereafter. The cash purchase price equals 15% of the monthly average gold price for the month preceding the delivery date for all gold purchased. As of June 30, 2021, approximately 283,500 ounces of payable gold have been delivered to RGLD Gold.
Andacollo is an open-pit mine and milling operation located in central Chile, Region IV in the Coquimbo Province and is operated by Compañía Minera Teck Carmen de Andacollo (“CMCA”), a 90% owned subsidiary of Teck Resources Limited (“Teck”). The Andacollo mine is located in the foothills of the Andes Mountains approximately 1.5 miles southwest of the town of Andacollo. The regional capital of La Serena and the coastal city of Coquimbo are approximately 34 miles northwest of the Andacollo mine by road, and Santiago is approximately 215 miles south by air. Access to the mine is provided by Route 43 (R-43) south from La Serena to El Peñon. From El Peñon, D-51 is followed east and eventually curves to the south to Andacollo. Both R-43 and D-51 are paved roads.
Stream deliveries from Andacollo were approximately 46,400 ounces of gold during the fiscal year ended June 30, 2021, compared to approximately 43,900 ounces of gold during the fiscal year ended June 30, 2020.
Teck expects grades to continue to decline towards reserve grades. The current life of mine for Andacollo is expected to continue until calendar year 2035. According to Teck, additional permits or permit amendments will be required to execute the life of mine plan.
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Khoemac a u Project (Botswana)
RGLD Gold owns the right to receive 84% of the payable silver produced from Khoemac a u Project (“Khoemac a u”) until the delivery of approximately 33.6 million silver ounces, and 42% thereafter. RGLD Gold will pay a cash price equal to 20% of the spot silver price for each ounce delivered; however, if Khoemac a u Copper Mining (Pty.) Limited (“KCM”) achieves mill expansion throughput levels above 13,000 tonnes per day (30% above current mill design capacity), RGLD Gold will pay a higher ongoing cash price for silver ounces delivered in excess of specific annual thresholds.
Khoemac a u is a copper-silver development project located within the North West and Ghanzi Districts of Botswana, and is owned by KCM. The license area is generally south-west of the town of Maun and north-east of the town of Ghanzi. Khoemac a u is accessed from the city of Maun, approximately 40 miles southwest of the town of Toteng on a major travel route, the A3 highway, a paved road and then approximately 16 miles on gravel road to reach the Boseto plant site. Khoemac a u includes a fully mechanized underground mining operation at the Zone 5 deposit and treatment of sulphide ores at the Boseto concentrator. Ore is transported 20 miles from Zone 5 to the Boseto processing facility via a sealed haul road.
Since underground development of Zone 5 commenced in early calendar year 2020, more than 350,000 tonnes of high-grade sulfide ore has been stockpiled on surface. While the state of emergency declared by the Government of Botswana to help prevent the spread of COVID-19 remains in place until at least September 30, 2021, mining remains designated as an “essential service” and KCM reports that activities at site are continuing. Absent any potential further unforeseen impacts caused by COVID-19 considerations, KCM expects to ramp up through the balance of calendar year 2021 and reach full production in early calendar year 2022. At full production, Khoemac a u has the capacity to produce 155,000 to 165,000 tonnes of high-grade copper and silver concentrate a year, containing approximately 60,000 to 65,000 tonnes of payable copper and 1.8 to 2.0 million ounces of payable silver.
As of June 30, 2021, Royal Gold had remaining committed funding of $49.4 million to KCM in the form of $42.4 million of additional advance payments under the stream and $7.0 million remaining on a subordinated debt facility, both of which may be drawn at the election of KCM prior to the earlier of completion of development or 60 days after the start of commercial production. On July 7, 2021, KCM drew the remaining $7.0 million amount on the subordinated debt facility, reducing Royal Gold’s remaining committed funding to $42.4 million of additional advance payments. The subordinated debt facility has a term of seven years, carries interest at a rate of LIBOR +11% and requires mandatory repayment upon certain events. KCM has indicated that it does not expect to draw any material amounts from this remaining committed funding.
Mount Milliga n (British Columbia, Canada)
RGLD Gold owns the right to purchase 35% of the payable gold and 18.75% of the payable copper produced from the Mount Milligan copper-gold mine in British Columbia, Canada, which is operated by an indirect subsidiary of Centerra Gold Inc. (“Centerra”). The cash purchase price for gold is equal to the lesser of $435 per ounce, with no inflation adjustment, or the prevailing market price when purchased. The cash purchase price for copper is 15% of the spot price. As of June 30, 2021, approximately 578,800 ounces of payable gold and 51.6 million pounds of payable copper have been delivered to RGLD Gold.
Mount Milligan is an open-pit mine and is located within the Omenica Mining Division in North Central British Columbia, approximately 96 miles northwest of Prince George, 53 miles north of Fort St. James, and 59 miles west of Mackenzie. The Mount Milligan project is accessible by commercial air carrier to Prince George, British Columbia, then by vehicle from the east via Mackenzie on the Finlay Philip Forest Service Road and the North Philip Forest Service Road, and from the west via Fort St. James on the North Road and Rainbow Forest Service Road. Road travel to the Mount Milligan property site is 482 miles from Prince Rupert and 158 miles from Prince George.
Gold stream deliveries from Mount Milligan were approximately 62,300 ounces during the fiscal year ended June 30, 2021, compared to approximately 59,900 ounces during the fiscal year ended June 30, 2020.
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Copper stream deliveries from Mount Milligan were approximately 16.9 million pounds during the fiscal year ended June 30, 2021, compared to approximately 12.7 million pounds during the fiscal year ended June 30, 2020. Increased deliveries resulted from differences in the timing of shipments and settlements during the periods, in addition to higher tonnage and higher copper grades processed, slightly offset by lower copper recovery.
Centerra reported in May that given productivity improvements, cost controls and brownfield exploration success, it was updating the Mount Milligan life of mine plan. On August 10, 2021, Centerra reported that exploration activity is ongoing and results from drilling during the quarter ended June 30, 2021, include significant mineralization at several targets below the ultimate open pit boundary and along the eastern and southeastern margins of the open pit.
With respect to water supply, on August 10, 2021, Centerra reported that Mount Milligan accessed water from surface water sources and groundwater wells near the tailings storage facility in the quarter ended June 30, 2021, and with stored water inventory in excess of eight million cubic meters it estimates that Mount Milligan has sufficient water to enable continuous production for at least twelve months. Centerra also reported that it continues to pursue a longer-term solution to its water requirements at Mount Milligan and is in discussions with regulators, First Nations partners and other stakeholders. Centerra reported that in the first half of calendar year 2021 it obtained an environmental assessment certificate amendment and related permits to access surface water sources for Mount Milligan through November 2023.
On August 10, 2021, Centerra also reported that it is on track to achieve calendar year 2021 production guidance of between 180,000 and 200,000 ounces of gold and between 70 million and 80 million pounds of copper at Mount Milligan. However, Centerra also reported that forest fires in the Province of British Columbia have the potential to disrupt shipments to and from the mine and the operation itself.
Pueblo Viejo (Sanchez Ramirez, Dominican Republic)
RGLD Gold owns the right to purchase 7.5% of Barrick Gold Corporation’s (“Barrick”) interest in the gold produced from the Pueblo Viejo mine until 990,000 ounces of gold have been delivered, and 3.75% thereafter. The cash purchase price for gold is 30% of the spot price of gold per ounce delivered until 550,000 ounces of gold have been delivered, and 60% of the spot price of gold per ounce delivered thereafter. RGLD Gold also owns the right to purchase 75% of Barrick’s interest in the silver produced from the Pueblo Viejo mine, subject to a minimum silver recovery of 70%, until 50 million ounces of silver have been delivered, and 37.5% thereafter. The cash purchase price for silver is 30% of the spot price of silver per ounce delivered until 23.1 million ounces of silver have been delivered, and 60% of the spot price of silver per ounce delivered thereafter. As of June 30, 2021, approximately 267,200 ounces of payable gold and 9.4 million ounces of payable silver have been delivered to RGLD Gold.
The Pueblo Viejo mine is located in the province of Sanchez Ramirez, Dominican Republic, approximately 60 miles northwest of Santo Domingo, and is owned by a joint venture in which Barrick holds a 60% interest and is responsible for operations, and in which Newmont Corporation (“Newmont”) holds a 40% interest. Pueblo Viejo is accessed from Santo Domingo by traveling northwest on Autopista Duarte, Highway #1, approximately 48 miles to Piedra Blanca and proceeding east for approximately 14 miles on Highway #17 to the gatehouse for Pueblo Viejo. Both Highway #1 and Highway #17 are paved.
Gold stream deliveries from Pueblo Viejo were approximately 40,800 ounces of gold during the fiscal year ended June 30, 2021, compared to approximately 45,000 ounces of gold during the fiscal year ended June 30, 2020. The decrease was attributable to lower tonnes processed, lower ore grades and lower recovery in fiscal year 2021.
Silver stream deliveries were approximately 1.5 million ounces of silver during the fiscal year ended June 30, 2021, compared to approximately 1.7 million ounces of silver during the fiscal year ended June 30, 2020. The decrease was attributable to lower silver recoveries resulting from temporary operational issues with the silver circuit that caused recoveries to fall below the fixed 70% recovery rate specified in the stream agreement. The stream agreement includes a deferral mechanism for ounces that cannot be delivered at this fixed recovery rate, with the economic impact of any shortfall in deliveries to be made up in future periods. As of June 30, 2021, approximately 437,000 ounces of silver deliveries have been deferred. Barrick has advised that maintenance work on the silver recovery circuit is complete and silver recovery has steadily improved over the past quarter. Barrick also advised that modifications to further improve
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silver recovery are underway and are expected to be complete during the current quarter. With the recovery improvements, we expect delivery of the deferred ounces to begin next quarter.
Barrick reported continued progress at Pueblo Viejo during the June 2021 quarter to expand the process plant and tailings storage facilities. Barrick estimates that the expansion project could significantly increase throughput and allow the mine to maintain average annual gold production of approximately 800,000 ounces after calendar year 2022 (on a 100% basis), and that the increase in tailings storage capacity has the potential to convert over 9 million ounces of mineralized material to reserves (on a 100% basis). Barrick reported that as of June 30, 2021, the engineering design of the process plant expansion is 87% complete, construction is 10% complete, and completion of the process plant expansion is expected by the end of calendar 2022. Barrick also reported an agreement with key stakeholders to allow independent government-led oversight of the strategic environmental and social impact assessment studies for the new tailings storage facility, which is an important first step in starting fieldwork and advancing the permitting process.
Barrick expects the proportion of lower grade stockpile ore in the feed blend to steadily increase until the mine expansion pits are fully developed as part of the decision on the proposed plant and tailings expansion project.
In calendar year 2021, gold production from Barrick’s 60% interest in Pueblo Viejo is expected to be between 470,000 and 510,000 ounces, compared to actual gold production of 542,000 ounces in calendar year 2020.
Wassa (Western Region, Ghana)
RGLD Gold owns the right to purchase 10.5% of the gold produced from the Wassa mine, operated by Golden Star Resources Ltd. (“Golden Star”), until an aggregate 240,000 ounces have been delivered. Once the applicable delivery threshold is met, the stream percentage will decrease to 5.5%. As of June 30, 2021, approximately 128,000 ounces of payable gold attributable to the ounce threshold have been delivered to RGLD Gold.
The Wassa underground mine and oxide ore mill are located near the village of Akyempim in the Wassa East District, in the Western Region of Ghana, approximately 50 miles north of Cape Coast and 93 miles west of the capital Accra. The main access to the site is from the east, via the Cape Coast to Twifo-Praso road, then over the combined road-rail bridge on the Pra River. There is also an access road from Takoradi in the south via Mpohor. An airport at Takoradi is capable of handling jet aircraft and is serviced by several commercial flights each day.
Stream deliveries from Wassa were approximately 16,700 ounces of gold during the fiscal year ended June 30, 2021, compared to approximately 16,500 ounces of gold during the fiscal year ended June 30, 2020.
On June 28, 2021, Golden Star announced that production guidance for calendar 2021 would be reduced to between 145,000 and 155,000 ounces of gold from between 165,000 and 175,000 ounces of gold due to a delay in the commissioning of a new paste fill plant and subsequent changes to the mine plan. On July 28, 2021, Golden Star further reported positive results from paste fill test work, that if continued, could see a potential restart of the planned filling schedule in the fourth quarter of 2021 and return to the previously planned production from secondary stopes in calendar year 2022.
Additionally, on June 28, 2021, Golden Star disclosed that COVID-19 has impacted the availability of expatriate operators, contributing to lower than planned development rates. Operational improvements and the recruitment of additional jumbo operators have since resulted in an increase in development rates.
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Royalty Interests
Cortez (Nevada, USA)
Cortez is a series of large open-pit and underground mines, utilizing mill and heap leach processing, which are operated by Nevada Gold Mines LLC (“NGM”), a joint venture between Barrick and Newmont with respect to their Nevada operations. The operation is located approximately 60 air miles southwest of Elko, Nevada, in Lander County. The site is reached by driving west from Elko on Interstate 80 approximately 46 miles, and proceeding south on State Highway 306 approximately 23 miles. Our royalty interest at Cortez applies to the Pipeline and South Pipeline deposits, part of the Gap pit and the Crossroads deposit.
The royalty interests we hold at Cortez include:
(a) Reserve Claims (“GSR1”) . This is a sliding-scale GSR royalty for all products from an area originally known as the “Reserve Claims,” which includes the majority of the Pipeline and South Pipeline deposits. The GSR1 royalty rate is tied to the price of gold and does not include indexing for inflation or deflation. The GSR1 royalty rate is 5.0% at a gold price of $470 per ounce and higher.
(b) GAS Claims (“GSR2”) . This is a sliding-scale GSR royalty for all products from an area outside of the Reserve Claims, originally known as the “GAS Claims,” which encompasses approximately 50% of the Gap deposit and all of the Crossroads deposit. The GSR2 royalty rate is tied to the gold price, without indexing for inflation or deflation. The GSR2 royalty rate is 5.0% at a gold price of $470 per ounce and higher.
(c) Reserve and GAS Claims Fixed Royalty (“GSR3”) . The GSR3 royalty is a fixed rate GSR royalty of 0.7125% and covers the same cumulative area as is covered by our two sliding-scale GSR royalties, GSR1 and GSR2, except mining claims that comprise the undeveloped Crossroads deposit.
(d) Net Value Royalty (“NVR1”) and Net Value Royalty (Crossroads) (“NVR1C”) . The NVR1 royalty is a fixed royalty of 4.91% NVR that covers the area of the GAS Claims, excluding the majority of the Crossroads deposit. The NVR1C royalty, which covers the majority of the Crossroads deposit, is a fixed royalty of 4.52% NVR.
On average, above a gold price of $470 per ounce after the relevant deductions, the combined royalty interests of GSR1, GSR2, GSR3, NVR1 and NVR1C are equivalent to an approximate 8% gross smelter return royalty to Royal Gold.
We also own three other royalties in the Cortez area where there is currently no production and no reserves attributed to these royalty interests.
Production attributable to our royalty interests at Cortez increased to 237,000 ounces of gold in fiscal year 2021 compared to 173,300 ounces of gold in the prior year. The increase was a result of production ramping up at the Crossroads deposit.
NGM expects total gold production from the regions subject to our interests at Cortez to be approximately 350,000 to 375,000 ounces in calendar year 2021, compared to actual calendar year 2020 gold production of 206,000, and average approximately 415,000 ounces per year from calendar year 2022 through calendar year 2026. The Crossroads deposit is expected to provide the majority of the royalty ounces during this period.
Peñasquito (Zacatecas, Mexico)
We own a production payment equivalent to a 2.0% NSR royalty on all metal production from the Peñasquito open-pit mine, located in the State of Zacatecas, Mexico, and operated by a subsidiary of Newmont. The Peñasquito mine is located approximately 17 miles west of the town of Concepción del Oro, Zacatecas, Mexico. The mine, composed of two main deposits called Peñasco and Chile Colorado, hosts large gold, silver, zinc and lead reserves. The deposits contain both oxide and sulfide material, resulting in heap leach and mill processing. There are two access routes to the site. The first is
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via a turnoff from Highway 54 onto the State La Pardita road, then onto the Mazapil to Cedros State road. The second access is via the Salaverna by-pass road from Highway 54 approximately 16 miles south of Concepción del Oro. There is a private airport on site and commercial airports in the cities of Saltillo, Zacatecas and Monterrey.
For fiscal year 2021, gold production attributable to our royalty interest at Peñasquito increased to 701,500 ounces compared to 312,200 ounces in fiscal year 2020; silver production increased to 30.9 million ounces over the prior fiscal year of 27.8 million ounces; lead increased to 185.6 million pounds over the prior fiscal year of 182.3 million pounds; and zinc increased to 412.7 million pounds over the prior fiscal year of 393.9 million pounds. Fiscal year 2020 production was adversely impacted by multiple blockades and operations being placed on care and maintenance in April 2020 due to a Mexican federal government decree to temporarily suspend all non-essential activities in Mexico as part of a nationwide effort to help slow the spread of COVID-19.
Newmont provided full calendar year 2021 production guidance for Peñasquito of 660,000 ounces of gold, 30 million ounces of silver, 475 million pounds of zinc and 190 million pounds of lead, compared to calendar year 2020 actual production of 526,000 ounces of gold, 28 million ounces of silver, 318 million pounds of zinc and 179 million pounds of lead.
Reserve Information
Table 1 below summarizes proven and probable reserves for gold, silver, copper, nickel, zinc, lead and cobalt that are subject to our stream and royalty interests as of December 31, 2020, as reported to us by the operators of the mines. Properties are currently in production unless noted as development (“DEV”) within the table. The exploration royalties we own do not contain proven and probable reserves as of December 31, 2020. Please refer to pages 23-28 for the footnotes to Table 1.
Operators’ Estimated Proven and Probable Gold Reserves
As of December 31, 2020 (1)
Gold (2)
PROVEN +
PROBABLE
RESERVES (3)(4)(5)
Average
Gold
Tons of
Gold
Contained
Ore
Grade
Ozs (6)
PROPERTY
ROYALTY/METAL STREAM
OPERATOR
LOCATION
(M)
(opt)
(M)
Bald Mountain
1.75% - 2.5% NSR (7)
Kinross
United States
18.950
0.023
0.436
Cortez GSR1
0.40 - 5.0% GSR (8)
Nevada Gold Mines LLC
United States
10.523
0.024
0.256
Cortez GSR2
0.40 - 5.0% GSR (8)
Nevada Gold Mines LLC
United States
70.935
0.046
3.234
Cortez GSR3
0.71% GSR
Nevada Gold Mines LLC
United States
13.676
0.022
0.297
Cortez NVR1
4.91% NVR
Nevada Gold Mines LLC
United States
7.067
0.021
0.147
Cortez NVR1C
4.52% NVR (9)
Nevada Gold Mines LLC
United States
67.782
0.047
3.193
Gold Hill
1.0 - 2.0% NSR (10,11) ; 0.6 - 0.9% NSR (12)
Kinross
United States
4.897
0.016
0.080
Goldstrike (SJ Claims)
0.9% NSR
Nevada Gold Mines LLC
United States
24.478
0.059
1.433
Hasbrouck Mountain (DEV)
1.5% NSR
West Vault Mining
United States
35.616
0.017
0.588
Leeville
1.8% NSR
Nevada Gold Mines LLC
United States
6.041
0.277
1.675
Marigold
2.0% NSR
SSR Mining
United States
163.192
0.013
2.168
Granite Creek (DEV)
3.0% NSR (13,14) ; 2.94% NSR (13,15)
I-80 Gold Corp
United States
7.5571
0.064
0.483
Relief Canyon
3.0% NSR (16)
Americas Gold and Silver
United States
18.873
0.022
0.421
Ruby Hill
3.0% NSR
Waterton Precious Metals Fund
United States
1.726
0.014
0.024
Twin Creeks
2.0% GPR
Nevada Gold Mines LLC
United States
1.013
0.057
0.057
Wharf
0.0 - 2.0% GSR (17)
Coeur Mining
United States
26.408
0.025
0.667
Back River - Goose Lake (DEV)
1.95% GSR (18)
Sabina Gold & Silver
Canada
20.603
0.174
3.586
Bateman Gold (DEV)
1.0% NSR
Evolution Mining
Canada
3.927
0.162
0.635
Canadian Malartic
1.0 - 1.5% NSR (19)
Agnico Eagle/Yamana
Canada
32.161
0.027
0.860
Cochenour (DEV)
5.0% NPI
Evolution Mining
Canada
1.585
0.181
0.287
Côté Gold Project (DEV)
1.0% NSR
IAMGOLD
Canada
179.787
0.028
5.099
Kutcho Creek (DEV)
2.0% NSR
Kutcho Copper Corp
Canada
11.509
0.009
0.100
LaRonde Zone 5
2.0% NSR
Agnico Eagle
Canada
12.959
0.061
0.788
Mount Milligan
35% of payable gold (20)
Centerra Gold
Canada
188.028
0.011
2.148
Pine Cove
7.5% NPI
Anaconda Mining
Canada
0.295
0.060
0.018
Rainy River
6.5% of gold produced (21)
New Gold
Canada
81.478
0.032
2.598
Williams
0.97% NSR
Barrick
Canada
6.543
0.138
0.900
Dolores
3.25% NSR
Pan American
Mexico
40.675
0.025
1.031
Peñasquito
2.0% NSR
Newmont
Mexico
427.476
0.017
7.100
Andacollo
100% of payable gold (22)
Teck
Chile
332.347
0.003
0.969
La Fortuna (DEV)
1.4% NSR (23)
Newmont
Chile
225.599
0.014
3.078
Don Mario (DEV)
3.0% NSR
Orvana
Bolivia
2.240
0.054
0.121
Pueblo Viejo
7.5% of payable gold (24)
Barrick/Newmont
Dominican Republic
91.492
0.068
6.200
El Limon
3.0% NSR
Calibre
Nicaragua
4.448
0.128
0.568
La India (DEV)
3.0% NSR
Condor Gold
Nicaragua
7.606
0.089
0.675
Mara Rosa (DEV)
2.75% NSR
Amarillo Gold
Brazil
26.235
0.034
0.902
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Bellevue (DEV)
2.0% NSR
Bellevue Gold
Australia
2.976
0.232
0.690
Gwalia Deeps
1.5% NSR
St. Barbara
Australia
13.205
0.166
2.198
Jaguar Nickel (DEV)
1.5% NSR
Washington H. Soul Pattinson
Australia
1.323
0.008
0.010
King of the Hills
1.5% NSR
Red 5
Australia
71.209
0.033
2.384
Meekatharra
0.45% or 1.5% NSR (25)
Westgold Resources
Australia
5.483
0.079
0.435
South Laverton
1.5% NSR (26)
Northern Star
Australia
33.068
0.057
1.892
Southern Cross
1.5% NSR
Shandong Tianye Group
Australia
10.538
0.096
1.010
Wembley Durack (DEV)
1.0% NSR
Westgold Resources
Australia
0.362
0.055
0.020
Inata
2.5% GSR
Balaji Group
Burkina Faso
6.352
0.054
0.340
Taparko (28)
2.0% GSR
Nord Gold
Burkina Faso
4.812
0.043
0.207
Prestea
5.5% of payable gold (28)
Future Global Resources
Ghana
0.944
0.320
0.302
Wassa
10.5% of payable gold (29)
Golden Star Resources
Ghana
12.688
0.086
1.089
Operators’ Estimated Proven and Probable Silver Reserves
As of December 31, 2020 (1)
Silver (30)
PROVEN +
RESERVES
PROBABLE
(3)(4)(5)
Average
Silver
Tons of
Silver
Contained
Ore
Grade
Ozs (6)
PROPERTY
ROYALTY/METAL STREAM
OPERATOR
LOCATION
(M)
(opt)
(M)
Gold Hill
1.0 - 2.0% NSR (10,11) ; 0.6 - 0.9% NSR (12)
Kinross
United States
4.897
0.251
1.230
Hasbrouck Mountain (DEV)
1.5% NSR
West Vault Mining
United States
35.616
0.297
10.569
Relief Canyon
3.0% NSR (16)
Americas Gold and Silver
United States
18.873
0.057
1.085
Kutcho Creek (DEV)
2.0% NSR
Kutcho Copper Corp
Canada
11.509
1.008
11.600
Rainy River
60% of silver produced (21)
New Gold
Canada
81.478
0.088
7.152
Dolores
2.0% NSR
Pan American
Mexico
40.675
0.679
27.600
Peñasquito
2.0% NSR
Newmont
Mexico
427.476
0.996
425.750
Don Mario (DEV)
3.0% NSR
Orvana
Bolivia
2.240
1.438
3.221
Pueblo Viejo
75% of payable silver (24)
Barrick/Newmont
Dominican Republic
91.492
0.443
40.500
La India (DEV)
3.0% NSR
Condor Gold
Nicaragua
7.606
0.156
1.185
Jaguar Nickel (DEV)
1.5% NSR
Washington H. Soul Pattinson
Australia
1.323
2.268
3.000
Khoemacau (DEV)
84% of payable silver (31)
Cupric Canyon
Botswana
37.434
0.574
21.470
Operators’ Estimated Proven and Probable Base Metal Reserves
As of December 31, 2020 (1)
Copper (32)
PROVEN +
PROBABLE
RESERVES (3)(4)(5)
Average
Tons of
Base Metal
Base Metal
Ore
Grade
Contained Lbs (6)
PROPERTY
ROYALTY/METAL STREAM
OPERATOR
LOCATION
(M)
(%)
(M)
Kutcho Creek (DEV)
2.0% NSR
Kutcho Copper
Canada
11.509
2.01%
463.000
Mount Milligan
18.75% of payable copper (20)
Centerra Gold
Canada
188.028
0.22%
837.000
Voisey’s Bay
2.7% NVR
Vale
Canada
31.497
0.86%
543.239
Don Mario (DEV)
3.0% NSR
Orvana
Bolivia
2.240
1.89%
84.723
La Fortuna (DEV)
1.4% NSR (23)
Newmont
Chile
225.599
0.51%
2,304.350
Jaguar Nickel (DEV)
1.5% NSR
Washington H. Soul Pattinson
Australia
1.323
0.42%
11.023
Las Cruces
1.5% NSR
First Quantum
Spain
0.154
2.11%
6.512
Lead (33)
PROVEN +
PROBABLE
RESERVES (3)(4)(5)
Average
Tons of
Base Metal
Base Metal
Ore
Grade
Contained Lbs (6)
PROPERTY
ROYALTY
OPERATOR
LOCATION
(M)
(%)
(M)
Peñasquito
2.0% NSR
Newmont
Mexico
383.825
0.35%
2,955.428
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Zinc (34)
PROVEN +
PROBABLE
RESERVES (3)(4)(5)
Average
Tons of
Base Metal
Base Metal
Ore
Grade
Contained Lbs (6)
PROPERTY
ROYALTY
OPERATOR
LOCATION
(M)
(%)
(M)
Kutcho Creek (DEV)
2.0% NSR
Kutcho Copper
Canada
11.509
3.19%
734.000
Peñasquito
2.0% NSR - Sulfide
Newmont
Mexico
383.825
0.83%
6,805.293
Jaguar Nickel (DEV)
1.5% NSR
Washington H. Soul Pattinson
Australia
1.323
6.25%
165.347
Nickel (35)
PROVEN +
PROBABLE
RESERVES (3)(4)(5)
Tons of
Average
Base Metal
Ore
Base Metal
Contained Lbs (6)
PROPERTY
ROYALTY
OPERATOR
LOCATION
(M)
Grade (%)
(M)
Voisey’s Bay
2.7% NVR
Vale
Canada
31.497
1.96%
1,231.859
Mt Goode Cosmos (DEV)
1.5% NSR
Western Areas
Australia
2.313
2.24%
103.628
Cobalt (36)
PROVEN +
PROBABLE
RESERVES (3)(4)(5)
Average
Tons of
Base Metal
Base Metal
Ore
Grade
Contained Lbs (6)
PROPERTY
ROYALTY
OPERATOR
LOCATION
(M)
(%)
(M)
Voisey’s Bay
2.7% NVR
Vale
Canada
31.497
0.12%
74.753
1. Reserves have been reported by the operators of record as of December 31, 2020, with the exception of the following properties where reserves have been reported by the operators of record or their predecessors in interest and are unadjusted for production since these dates: Bellevue - February 28, 2021; Back River - January 15, 2021; King of the Hills - September 30, 2020; Mt Goode Cosmos - August 3, 2020; Dolores, Gwalia Deeps, Khoemac a u, Meekatharra, Relief Canyon and South Laverton - June 30, 2020; Mara Rosa - May 31, 2020; Don Mario - September 30, 2019; La India - January 25, 2019; Wembley Durack - June 30, 2018; Jaguar Nickel - June 30, 2017; Kutcho Creek - June 15, 2017; Bald Mountain, Gold Hill and Inata - December 31, 2016; Southern Cross - July 24, 2016; Hasbrouck Mountain - June 3, 2015; Granite Creek and Ruby Hill - December 31, 2014. We are not able to disclose reserves for Robinson.
2. Gold reserves were calculated by the operators at the following per ounce prices: A$2,000 - King of the Hills and Meekatharra; A$1,750 - South Laverton; A$1,600 - Gwalia and Southern Cross; $1,500 - Don Mario; $1,400 - El Limon, Mara Rosa, Rainy River, Taparko and Wharf; $1,350 - Dolores; $1,300 - Andacollo, La Fortuna, Granite Creek, Prestea, Relief Canyon and Wassa; $1,250 - Canadian Malartic, Inata, Kutcho Creek, La India, La Ronde Zone 5, Marigold and Mount Milligan; $1,225 - Hasbrouck Mountain; $1,200 - Bald Mountain, Cortez, Côté Gold Project, Gold Hill, Goldstrike, Leeville, Peñasquito, Pueblo Viejo, Twin Creeks and Williams; and $1,100 - Ruby Hill. No gold price was reported for Robinson.
3. Set forth below are the definitions of proven and probable reserves used by the SEC. “Reserve” is that part of a mineral deposit which could be economically and legally extracted or produced at the time of the reserve determination. “Proven (Measured) Reserves” are reserves for which (a) quantity is computed from dimensions revealed in outcrops, trenches, workings or drill holes; grade and/or quality are computed from the results of detailed sampling; and (b) the sites for inspection, sampling and measurement are spaced so closely and the geologic character is so well defined that the size, shape, depth and mineral content of the reserves are well established. “Probable (Indicated) Reserves” are reserves for which the quantity and grade and/or quality are computed from information similar to that used for proven (measured) reserves, but the sites for inspection, sampling and measurement are farther apart or are otherwise less adequately spaced. The degree of assurance, although lower than that for proven (measured) reserves, is high enough to assume continuity between points of observation.
4. We have disclosed a number of reserve estimates that are provided by operators that are foreign issuers and are not based on the SEC's definitions for proven and probable reserves. For Canadian issuers, definitions of "mineral reserve," "proven mineral reserve," and "probable mineral reserve" conform to the Canadian Institute of Mining, Metallurgy and Petroleum definitions of these terms as of the effective date of estimation as required by National Instrument 43-101 of the Canadian Securities Administrators. For Australian issuers, definitions of "mineral reserve," "proven mineral reserve," and "probable mineral
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reserve" conform with the Australasian Code for Reporting of Mineral Resources and Ore Reserves prepared by the Joint Ore Reserves Committee of the Australasian Institute of Mining and Metallurgy, Australian Institute of Geoscientists and Minerals Council of Australia, as amended ("JORC Code"). We do not reconcile the reserve estimates provided by the operators with definitions of reserves used by the SEC.
5. The reserves reported are either estimates received from the various operators or are based on documentation provided to us or are derived from publicly available information from the operators of the various properties or various National Instrument 43-101 or JORC Code reports filed by operators. We are not able to reconcile the reserve estimates prepared in reliance on National Instrument 43-101 or JORC Code with definitions of the SEC.
6. “Contained ounces” or “contained pounds” do not take into account recovery losses in mining and processing the ore.
7. NSR sliding-scale schedule (price of gold per ounce - royalty rate): Below $375 - 1.75%; >$375 to $400 - 2.0%; >$400 to $425 - 2.25%; >$425 - 2.5%. All price points are stated in 1986 dollars and are subject to adjustment in accordance with a blended index comprised of labor, diesel fuel, industrial commodities and mining machinery.
8. GSR1 and GSR 2 sliding-scale schedule (price of gold per ounce - royalty rate): Below $210 - 0.40%; $210 to $229.99 - 0.50%; $230 to $249.99 - 0.75%; $250 to $269.99 - 1.30%; $270 to $309.99 - 2.25%; $310 to $329.99 - 2.60%; $330 to $349.99 - 3.00%; $350 to $369.99 - 3.40%; $370 to $389.99 - $3.75%; $390 to $409.99 - 4.0%; $410 to $429.99 - 4.25%; $430 to $449.99 - 4.50%; $450 to $469.99 - 4.75%; $470 and higher - 5.00%.
9. NVR1C is the Crossroads portion of NVR1.
10. The royalty is capped at $10 million. As of June 30, 2021, royalty payments of approximately $8.8 million have been received.
11. The 1.0% to 2.0% sliding-scale NSR royalty will pay 2.0% when the price of gold is above $350 per ounce and 1.0% when the price of gold falls to $350 per ounce or below. The 0.6% to 0.9% NSR sliding-scale schedule (price of gold per ounce - royalty rate): Below $300 - 0.6%; $300 to $350 - 0.7%; > $350 to $400 - 0.8%; > $400 - 0.9%. The silver royalty rate is based on the price of gold.
12. The 0.6% to 0.9% sliding-scale NSR applies to the M-ACE claims. The operator did not break out reserves or resources subject to the M-ACE claims royalty.
13. Royalty only applies to Section 29 which currently holds about 95% of the reserves reported for the property.
14. An additional Cordilleran royalty of 5% NSR applies to a portion of Section 28.
15. Different Rayrock royalty rates apply to Sections 28, 32 and 33; these rates vary depending on pre-existing royalties. The Rayrock royalties take effect once 200,000 ounces of gold have been produced from open pit mines on the property. As of June 30, 2021, approximately 103,000 ounces have been produced.
16. Reserves represent our interest based on our royalty ground covering approximately 69% of the resource footprint by area.
17. NSR sliding-scale schedule (price of gold per ounce - royalty rate): $0.00 to under $350 - 0.0%; $350 to under $400 - 0.5%; $400 to under $500 - 1.0%; $500 or higher - 2.0%.
18. Goose Lake royalty applies to production above 400,000 ounces.
19. NSR sliding-scale schedule (price of gold per ounce - royalty rate): $0.00 to $350 - 1.0%; above $350 - 1.5%.
20. Centerra Gold will deliver 35% of payable gold produced, subject to a fixed payable percentage of 97%, and 18.75% of payable copper produced, subject to a minimum payable percentage of 95%. The purchase price for gold is equal to the lesser of $435 per ounce delivered or the prevailing market price and the purchase price for copper is 15% of the spot price per metric tonne delivered. As of June 30, 2021, approximately 578,800 ounces of payable gold and 51.6 million pounds of payable copper have been delivered.
21. New Gold will deliver: (a) gold in amounts equal to 6.50% of gold produced until 230,000 ounces have been delivered, and 3.25% of gold produced thereafter, and (b) silver in amounts equal to 60% of silver produced until 3.10 million ounces have been delivered, and 30% of silver produced thereafter, in each case at a purchase price equal to 25% of the spot price per
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ounce delivered. As of June 30, 2021, approximately 54,000 ounces of payable gold and 699,400 ounces of payable silver have been delivered.
22. Teck will deliver gold in amounts equal to 100% of payable gold until 900,000 ounces have been delivered, and 50% of payable gold thereafter, subject to a fixed payable percentage of 89%, at a purchase price equal to 15% of the monthly average gold price for the month preceding the delivery date for each ounce delivered. As of June 30, 2021, approximately 283,500 ounces of payable gold have been delivered.
23. The royalty covers approximately 30% of the La Fortuna deposit. Reserves attributable to our royalty represent 3/7 of Newmont's reporting of 70% of the total reserve.
24. Barrick will deliver: (a) gold in amounts equal to 7.50% of Barrick’s 60% interest in gold produced until 990,000 ounces have been delivered, and 3.75% of Barrick’s 60% interest in gold produced thereafter, at a purchase price equal to 30% of the spot price per ounce delivered until 550,000 ounces have been delivered, and 60% of the spot price per ounce delivered thereafter; and (b) silver in amounts equal to 75% of Barrick’s 60% interest in silver produced, subject to a fixed silver recovery of 70%, until 50 million ounces have been delivered, and 37.50% of Barrick’s 60% interest in silver produced thereafter, at a purchase price equal to 30% of the spot price per ounce delivered until 23.10 million ounces of silver have been delivered, and 60% of the spot price per ounce delivered thereafter. As of June 30, 2021, approximately 267,200 ounces of payable gold and 9.4 million ounces of payable silver have been delivered.
25. The royalty rate depends on the tenement and the base rate is either 0.45% or 1.5%. In addition, Paddy's Flat production is subject to a royalty of A$10 per ounce on production above 50,000 ounces. At Reedy's an additional 1.5% to 2.5% NSR sliding-scale royalty pays at a rate of 1.5% for the first 75,000 ounces produced in any 12-month period and at a rate of 2.5% on production above 75,000 ounces during that 12-month period and a 1.0% NSR royalty applies to the Rand area only.
26. We hold an additional 4.0% net profits interest royalty that applies to certain South Laverton tenements (Kurnalpi), as well as an A$6.00 per ounce royalty once 265,745 ounces of gold have been produced and an A$10.00 per ounce royalty once 160,333 ounces of gold have been produced from certain South Laverton tenements.
27. There is a 0.75% GSR milling royalty that applies to ore that is mined outside of the defined area of the Taparko-Bouroum project that is processed through the Taparko facilities up to a maximum of 1.1 million tons per year.
28. Future Global Resources Limited (“FGR”) will deliver 5.5% of payable gold produced from Prestea and Bogoso. The purchase price for gold ounces delivered is 30% of the spot gold price.
29. Golden Star will deliver 10.5% of payable gold produced until 240,000 ounces have been delivered from Wassa, and 5.5% of payable gold produced thereafter. The purchase price for gold ounces delivered is 20% of the spot gold price until the threshold has been met, and 30% of the spot gold price thereafter. As of June 31, 2021, approximately 128,000 ounces of payable gold attributable to the ounce threshold have been delivered.
30. Silver reserves were calculated by the operators at the following prices per ounce: $20.00 - Gold Hill; $18.00 - Dolores and Rainy River; $17.75 - Khoemac a u; $17.50 - Hasbrouck Mountain; $17.00 - Don Mario, Kutcho Creek and Relief Canyon; $16.50 - Pueblo Viejo; and $16.00 - Peñasquito. No silver price was reported for La India, Kutcho Creek or Jaguar Nickel.
31. When production commences, Cupric will deliver 84% of payable silver produced, until approximately 33.6 million ounces of silver have been delivered from Khoemac a u, and 42% thereafter, subject to a fixed payable percentage of 90%. The purchase price is 20% of the spot price of silver. Depending on the achievement by Cupric of mill expansion throughput levels above 13,000 tonnes per day (30% above current mill design capacity), we will pay higher ongoing cash payments for ounces delivered in excess of specific annual thresholds.
32. Copper reserves were calculated by the operators at the following prices per pound: $3.00 - Andacollo, Khoemac a u, La Fortuna and Mount Milligan; $2.81 - Voisey's Bay; $2.75 – Kutcho Creek and Las Cruces; and $2.50 - Don Mario. No copper price was reported for Jaguar Nickel or Kutcho Creek.
33. Lead reserve price was calculated by the operators at the following prices per pound: $0.95 - Peñasquito.
34. Zinc reserve price was calculated by the operators at the following prices per pound: $1.15 - Peñasquito; and $1.10 - Kutcho Creek. No zinc price was reported for Jaguar Nickel.
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35. Nickel reserve price was calculated by the operator at the following price per pound: $7.50 - Mt Goode Cosmos; and $6.12 - Voisey's Bay.
36. Cobalt reserve price was calculated by the operator at the following price per pound: $15.88 - Voisey's Bay.
ITEM 3. LEGAL PROCEEDINGS
None.
ITEM 4. MINE SAFETY DISCLOSURE
Not applicable.
PART II
Text extracted from the filing as submitted to EDGAR. Formatting, tables and exhibits are simplified for reading; the original document is authoritative for anything you rely on.