Metalla Royalty & Streaming Ltd. [MTA-TSXV; NYSE American] has agreed to acquire one silver stream and three royalties from Alamos Gold Inc. [AGI-TSX, NYSE]. In return for the assets, Metalla will issue $5 million worth of common shares to Alamos.
The package includes a 20% silver stream on the Esperanza project, an advanced stage, low-capital intensity gold project in Morelos state, Mexico. The stream is subject to a maximum of 500,000 ounces silver delivery if commercial production occurs prior to 2029. Metalla will also acquire the right of first refusal on future royalty and stream financing for the Esperanza project, where the operator is Zacatecas Silver Corp. [ZAC-TSXV]. The project is envisioned as a 7.3 million tonne-per-annum mine, producing an annual average of 111,000 ounces of gold and 225,000 ounces of silver. Zacatecas expects to deliver an updated prefeasibility study on Esperanza in early 2023.
The package also includes:
- A 2.0% net smelter royalty (NSR) which covers the past-producing Ronda mine at Platinex Inc.’s [PTX-CSE] Shining Tree exploration property near Shining Tree, Ont. Ronda is along trend from Iamgold Corp’s [IMG-TSX, IAG-NYSE] Cote gold project.
- A 1.4% NSR Fenn Big South royalty, which covers five mineral claims on the southern concessions covering the Destor-Porcupine fault, three kilometres south of Mayfair Gold Corp’s [MFG-TSX] three million-ounce Fenn-Gibb property in northeastern Ontario.
- The 2.0 NSR Northshore West royalty on the Northshore West property near Thunder Bay, Ont. It covers 234 hectares in the western area of Ready Set Gold Corp. [RDY-CSE] Northshore project, where New Path recently outlined a resource of 240,000 ounces of gold.
Metalla will issue at closing $5 million common shares based on the 20-day volume weighted average price of the shares traded on the NYSE American exchange prior to the announcement at a price of US$5.32, representing 939,355 common shares.
Metalla shares were virtually unchanged on the news, easing 0.14% or $0.01 to $7.00. The shares currently trade in a 52-week range of $10.40 and $4.72.
“We are pleased to partner with Alamos for a second time at Metalla,’’ said Brett Heath, Metall’s President and CEO. “This transaction adds meaningful silver leverage to our portfolio while complementing our Canadian exploration portfolio in known mining camps and proven geological trends.’’
Back in April, 2019, Metalla agreed to acquire a portfolio of 18 royalties from Alamos Gold for $11.5 million, payable in common shares of Metalla. At that time, the acquisition of 16 royalties and two options to acquire additional royalties expanded Metalla’s portfolio to 43 royalties and streams.
The purchased assets include a 2% NSR royalty on the El Realto property, which is owned operated by Agnico-Eagle Mines Ltd. (AEM-TSX, AEM-NYSE). El Realto is adjacent to Agnico’s operating La India mine.