Sandstorm Gold Acquires NSR Royalty From Solitario
VANCOUVER, BRITISH COLUMBIA--(Marketwire - June 11, 2012) - Sandstorm Gold Ltd. ("Sandstorm" or the "Company") (TSX VENTURE:SSL) is pleased to announce that it has acquired a 2.4% net smelter returns royalty ("NSR") on the Mt. Hamilton gold project ("Mt. Hamilton") from Solitario Exploration & Royalty Corp. ("Solitario") (NYSE MKT:XPL)(TSX:SLR) and Ely Gold & Minerals Inc. ("Ely Gold") (TSX VENTURE:ELY). Mt. Hamilton is located in Nevada, U.S.A. and is held by Mt. Hamilton LLC ("MH-LLC") which is 80% owned by Solitario and 20% owned by Ely Gold. As consideration, Sandstorm will make an upfront cash payment to MH-LLC of US$6 million upon signing the agreement and a future cash remittance of US$4 million on January 15, 2013.
If MH-LLC enters into a gold stream agreement with Sandstorm that has an upfront deposit of no less than US$30 million, MH-LLC will have the option, for a period of 30 months, to repurchase up to 100% of the NSR for US$12 million. In addition, MH-LLC has provided Sandstorm with a right of first refusal on any future royalty or gold stream financing for the Mt. Hamilton project.
"Using a small amount of cash on hand, we have secured a royalty on an excellent project and we are well positioned to complete a gold stream as Mt. Hamilton progresses to the construction stage," said Sandstorm President & CEO Nolan Watson. "Solitario has been successful in developing the asset to date and we believe there is significant upside potential."
About Mt. Hamilton
The Mt. Hamilton gold project is located in White Pine County, Nevada, U.S.A. Solitario released a feasibility study in February 2012 showing favourable economics for an open pit operation with heap leach extraction. Once in operation, the mine is expected to produce 48,000 ounces of gold and 330,000 ounces of silver per year over an 8 year period, with excellent potential to add additional resources and extend the mine life.
| Mineral Reserve Statement, Centennial Gold-Silver Deposit | Reserve
Category | Tons
(millions) | Gold Grade | Silver Grade* | Contained
Gold
(oz) | Contained
Silver
(oz) | | Oz/Ton | g/Tonne | Oz/Ton | g/Tonne | | Proven | 0.923 | 0.032 | 1.10 | 0.155 | 5.31 | 29,300 | 142,700 | | Probable | 21.604 | 0.021 | 0.72 | 0.134 | 4.59 | 457,800 | 2,884,300 | | Prov.+ Probable | 22.527 | 0.022 | 0.75 | 0.136 | 4.66 | 487,100 | 3,028,200 |
| * Reported silver grade is cyanide soluble. | | | Mineral Resource Statement, Centennial Gold-Silver Deposit | Resource
Category | Tons
(000's) | Gold
Grade
(oz/t) | Contained
Gold
(oz) | Silver
Grade
(oz/t) | Contained
Silver
(oz) | | Measured | 918 | 0.032 | 29,524 | 0.155 | 142,152 | | Indicated | 22,732 | 0.022 | 497,330 | 0.132 | 3,010,471 | | Measured and Indicated | 23,650 | 0.022 | 526,854 | 0.133 | 3,152,624 | | Inferred | 3,454 | 0.018 | 60,859 | 0.079 | 273,457 |
| * Mineral Resources are not Mineral Reserves and do not have demonstrated economic viability. | |
Walter Hunt, Chief Operating Officer of Solitario, B.Sc.-Geology, M.S. Geologic Engineering, is the Qualified Person under NI 43-101 responsible for reviewing and approving the technical information contained in this news release.
For more information on Solitario, Ely Gold and the Mt. Hamilton project, please visit www.solitarioresources.com or www.elygoldandminerals.com. |
