Abitibi Royalties (RZZ-V) Feb 5, '16 is pleased to announce that it has entered into a binding Letter of Intent with Frontline Gold (FGC-V) to acquire an additional 1% net smelter royalty (“NSR”) on its Menderes Gold Project, increasing the Company’s NSR interest to 2%. The Menderes Gold Project surrounds Eldorado Gold Corporation’s Efemcukuru gold mine in Turkey on three sides ( Fig. 1). This is the eleventh royalty purchased near an existing mine since the “Royalty Search” was launched on June 9th.
Additional 1.0% NSR’s Purchased on Menderes Gold Project ( Fig. 1)
In exchange for the additional 1% NSR on the 6,194 hectare Menderes Gold Project, Abitibi Royalties has paid Frontline Cdn$16,000. Abitibi Royalties will pay the cash consideration from its cash flow. The Company’s NSR interest on the Menderes Gold Project now totals 2%.
Since launching the Royalty Search on June 9th, eleven royalties near existing mining operations have been acquired (pending TSX-Venture approval for the two royalties highlighted in the news release dated December 14th, 2015), which include royalties surrounding or near Agnico Eagle and Yamana’s Canadian Malartic mine in Québec, Agnico Eagle’s Lapa mine in Québec, Alamos Gold’s Young-Davidson mine in Ontario, Eldorado’s Efemcukuru mine in Turkey, Goldcorp’s Red Lake mine in Ontario, Hudbay’s 777 mine in Manitoba, Metanor Resources Bachelor mine in Québec and New Gold’s Rainy River mine in Ontario. A list of these royalties can be found here.
The Royalty Search (www.abitibiroyalties.com) is an easy to use website that allows mining companies and prospectors a quick way of accessing capital in this difficult commodities market.
Abitibi Royalties is offering to pay the annual claim fees/taxes related to:
1) Existing mineral properties or
2) Staking of new mineral properties.
In return for paying these fees, Abitibi Royalties would be granted a NSR on the property. To date, approximately 80 properties have been submitted through the website and 11 agreements have been finalized.
Update on Cash Flow
To date, the Company’s total cash flow in 2016 has totaled approximately Cdn$250,000.
Update on Share Repurchase Program
Since receiving approval to begin the Company’s Normal Course Issuer Bid (“NCIB”) on October 6th, 2015, Abitibi Royalties has repurchased approximately 43,000 Common Shares of the Company. The NCIB allows the Company to purchase up to 546,300 Common Shares (representing 5% of the Company's total issued and outstanding Common Shares as of September 21, 2015) over a period of twelve months. The NCIB will expire no later than October 5, 2016.
Restricted Share Unit Grants
The Company has granted an aggregate of 72,500 restricted share units (the "RSUs") to certain directors, officers and consultants pursuant to the Abitibi Royalties 2015 Share Unit Plan (the "RSU Plan"). The RSU Plan was approved by shareholders at the annual general and special meeting held on June 25th, 2015 and the RSU Plan received final approval from the TSX Venture Exchange (the "TSX-V") on July 27th, 2015.
Each RSU entitles the holder thereof to receive one common share of the Company and will vest in accordance with the following schedule: (i) 1/4 of the RSUs vested on February 4th, 2016; and (ii) the remaining RSUs will vest equally in annual installments until the third anniversary of the date of grant.
Following the aforementioned grant of RSUs, Abitibi Royalties will have 824,269 RSUs remaining for issuance under the RSU Plan.
About Abitibi Royalties
Abitibi Royalties holds a 3% NSR on the Odyssey North discovery, Jeffrey Zone and the eastern portion of the Barnat Extension and a 2% NSR on portions of the Gouldie and Charlie zones all at the Canadian Malartic mine near Val-d’Or, Québec. In addition, the Company is building a portfolio of royalties on early stage properties near producing mines and it holds 100% title to the Luc Bourdon and Bourdon West Prospects in the Ring of Fire, Ontario. The Company owns 3,549,695 shares of Yamana Gold and 444,197 shares of Agnico Eagle Mines.
Golden Valley Mines and Rob McEwen hold approximately 51.3% and 8.7% interest in Abitibi Royalties, respectively.
For additional information, please contact:
Ian J. Ball – President and CEO
2864 chemin Sullivan
Val-d’Or, Québec J9P 0B9
Tel.: 416-346-4680
Email: ian.ball@abitibiroyalties.com |
