Royal Gold subsidiary signs gold purchase and royalty agreements in Ecuador

Royal Gold (RGLD) announced that its wholly-owned subsidiary RGLD Gold has entered into a gold purchase agreement and a separate net smelter return royalty agreement for all metals, produced from the Warintza Project in southeastern Ecuador, indirectly owned and operated by Solaris Resources, for total cash consideration of $200M. Warintza has total Measured and Indicated Resources of 1.082 billion tonnes at a copper equivalent grade of 0.48%, and an additional Inferred Resource of 3.135B tonnes at a copper equivalent grade of 0.27%1. An updated mineral resource estimate incorporating an additional 82,000 meters of drilling and the publication of a prefeasibility study is expected in the Q3. The Solaris management team is targeting a project timeline with early works to begin in the second half of 2026, a construction decision by the end of 2026, and potential first production as soon as 2030. RG AG will pay a total of $200M in cash consideration in three installments: $100M on financial closing, which is expected to occur promptly, $50M after technical approval of the Environmental Impact Assessment and publication of the Pre-Feasibility Study, or PFS, and $50M one year after closing, upon full registration of security in Ecuador. Deliveries under the Gold Stream Agreement will be in an amount equal to 20 ounces of gold per million pounds of recovered copper produced from the stream area of interest defined below. RG AG will pay 20% of the spot gold price for each ounce delivered until the delivery of 90,000 ounces, and 60% of the spot gold price thereafter. On financial close, RG AG will receive an incremental net smelter return, or NSR, royalty over all metals produced from within the RGLD Gold Expanded AOI at an initial rate of 0.30%. The Royalty rate will increase by 0.0375% per year until the earlier to occur of the first delivery under the Gold Stream Agreement or May 21, 2033, to a maximum of 0.60%, subject to certain scenarios. RG AG expects to pay the first instalment of the Advance using cash on hand and the remaining $100M from available cash resources. Solaris has submitted the Environmental Impact Assessment, and is targeting completion of a Pre-Feasibility Study, PFS, in the Q3. Solaris is targeting first production in 2030.