Attached files
| file | filename |
|---|---|
| 8-K - CURRENT REPORT - ROYAL GOLD INC | v172189_8-k.htm |
Exhibit
99.1
ROYAL
GOLD ANNOUNCES THE COMPLETION OF THE ANDACOLLO GOLD TRANSACTION
DENVER, COLORADO. JANUARY
25, 2010: ROYAL GOLD, INC. (“Royal Gold”) (NASDAQ: RGLD;
TSX:RGL) announced the closing of the Andacollo gold transaction with a
subsidiary of Teck Resources Limited (“Teck”) (TSX:TCK.A and TCK.B; NYSE:TCK)
known as Compañía Minera Teck Carmen de Andacollo (“CdA”). Teck owns
90% of CdA and the remaining 10% is held by Empresa Nacional de Mineria, a
Chilean state-owned entity. Total consideration for the transaction
was approximately $218 million in cash and 1.2 million shares of Royal Gold
common stock. As a result of the closing of the transaction, CdA now
owns approximately 3.0% of Royal Gold’s issued and outstanding common
stock.
Royal
Gold will receive 75% of the gold produced from the sulfide portion of the
Andacollo copper and gold deposit, located in Chile, until 910,000 payable
ounces of gold have been sold, after which Royal Gold will receive 50% of all
future payable gold production from the property. Gold will be
produced as a by-product of copper production, with a gold recovery rate
estimated by the operator to be approximately 61%. Ore has been
introduced to the mill and shipment of copper concentrate is expected to
commence in April of this year. Full commercial production is
expected to be reached in the first half of 2010.
Tony
Jensen, President and Chief Executive Officer of Royal Gold said, “We are
pleased to be associated with an operator of Teck’s capabilities and
congratulate the CdA team on reaching this project commissioning milestone.
Our interest in Andacollo represents another cornerstone royalty for Royal
Gold and is expected to become our largest revenue source in the near future.
It is particularly exciting to see both Andacollo and our royalty interest
at Goldcorp's world class Peñasquito mine ramping up at the same
time.”
The
Andacollo mine has been in production since 1996, producing copper cathodes from
the oxide portion of the deposit. The underlying sulfide portion of the deposit,
known as the hypogene project, is currently in the commissioning
phase. As Teck stated in their press release today, CdA has resolved
issues associated with its process water supply and is developing a further
water resource and associated infrastructure to supply water to the operations
after 2011.
Teck estimates the sulfide portion of
the deposit contains proven and probable mineral reserves of approximately 393.5
million tonnes, with a grade of 0.13 grams of gold per tonne. This
equates to 1.6 million ounces of gold in the sulfide reserves which will be
mined over an estimated 20 years of production. Over the first 10
years of the mine life, Teck expects production will average 53,000 ounces of
gold and 76,000 tonnes of copper in concentrate annually. Royal
Gold’s interest does not apply to the production of copper.
Royal
Gold is a precious metals royalty company engaged in the acquisition and
management of precious metal royalty interests. The Company owns
royalties on 119 properties on six continents, including royalties on 21
producing properties and 13 development stage properties. Royal Gold
is publicly traded on the NASDAQ Global Select Market under the symbol “RGLD,”
and on the Toronto Stock Exchange under the symbol “RGL.”
For
further information, please contact:
Karen
Gross
Vice
President and Corporate Secretary
(303)
573-1660
Cautionary “Safe Harbor” Statement
Under the Private Securities Litigation Reform Act of 1995: With the
exception of historical matters, the matters discussed in this press release are
forward-looking statements that involve risks and uncertainties that could cause
actual results to differ materially from projections or estimates contained
herein. Such forward-looking statements include the expected shipment
of copper concentrate in April 2010, the Andacollo mine reaching full commercial
production in the first half of 2010, that Andacollo is a cornerstone royalty
and is expected to become the Company’s largest revenue source in the near
future, that both Andacollo and our royalty interest at Goldcorp’s world class
Peñasquito mine continue ramping up at the same time, the resolution of the
water issues associated with the process water supply, the development of a
future water resource and associated infrastructure to supply water to the
operations after 2011, the expected mine life of the project, and the operator’s
estimate of reserves and annual production for gold and
copper. Factors that could cause actual results to differ materially
from projections include, among others, precious metals prices, decisions and
activities of the operator of the various properties, unanticipated grade,
geological, metallurgical, processing or other problems the operator may
encounter, changes in project parameters as plans continue to be refined,
economic and market conditions, as well as other factors described elsewhere in
this press release and in our Annual Report on Form 10-K, Quarterly Report on
Form 10-Q,
and other filings with the
Securities and Exchange Commission. In addition, acquired royalty
interests on certain projects are subject to risks associated with conducting
business in a foreign country, including application of foreign laws to contract
and other disputes, foreign environmental laws and enforcement and uncertain
political and economic environments. Most of these factors are beyond
the Company’s ability to predict or control. The Company disclaims
any obligation to update any forward-looking statement made
herein. Readers are cautioned not to put undue reliance on
forward-looking statements.
- 1
-