Kerr Mines Inc. [KER-TSX; KERMF-OTC] and Star Royalties Ltd. jointly announced the execution of a definitive US$18,000,000 gold purchase and sale agreement (Streaming Agreement) to finance the restart of underground operations and gold production at the Copperstone Gold Mine in Arizona, USA.
Giulio T. Bonifacio, CEO of Kerr, stated: “This Streaming Agreement provides the required project financing to restart gold production at our Copperstone Gold Mine, which is targeted for Q4-2021. We are extremely pleased to be undertaking this financing transaction with Star Royalties, which has a seasoned team of mining professionals that will prove to be a valued partner as we advance Copperstone to production. With the extensive project evaluation undertaken by Star Royalties, we believe this streaming transaction further validates the value we have identified at Copperstone by way of our recent optimization efforts. We also note that we will be progressing the restart of operations under a whole ore leach processing scenario which will result in increased gold recoveries and production versus a floatation processing scenario.”
The US$18 million advance payment under the Streaming Agreement will be provided in three equal installments, with the first US$6 million installment to be advanced on the initial closing, expected to take place by November 20, 2020. The remaining two tranches will be advanced at the request of Kerr as it incurs expenditures for the restart of Copperstone Gold Mine Project with US$6 million by February 28, 2021 and a further US$6 million by April 30, 2021.
Star Royalties will purchase from Kerr an amount of refined gold equal to 9.9% of gold produced at Copperstone until a cumulative 21,000 ounces of refined gold are delivered, then 3.3% of gold produced until a cumulative 27,200 ounces are delivered, and 1.2% of gold produced thereafter for the remaining life-of-mine;
Star Royalties. is a growth-oriented, precious metals-focused royalty and streaming company.
Kerr Mines is advancing the restart of production at its 100%-owned, fully permitted past-producing Copperstone mine project that demonstrates significant upside exploration potential. The company’s is maximizing Copperstone’s potential by defining and expanding resources and further optimizing the mine’s economics for restart of production in 2021.