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Metalla Royalty and Streaming Ltd
Symbol C : MTA
Shares Issued 112,587,926
Close 2019-02-04 C$ 1.05
Recent Sedar Documents

Metalla acquires 1% NSR royalty on Fifteen Mile project

2019-02-04 09:08 ET - News Release

Mr. Brett Heath reports

METALLA ACQUIRES ROYALTY ON ATLANTIC GOLD'S FIFTEEN MILE STREAM PROJECT

Metalla Royalty and Streaming Ltd. has entered into a purchase and sale agreement to acquire from a third party a 1.0-per-cent net smelter return royalty on Atlantic Gold Corp.'s Fifteen Mile Stream project for $4-million (all dollar amounts are in U.S. dollars unless otherwise indicated). The purchase price will be satisfied by an upfront payment of $2.2-million in cash and 2,619,000 common shares of the company. The royalty is in connection with two claims formally held by the seller which cover the Egerton-Maclean, Hudson, 149 East zone and the majority of the Plenty deposit, which collectively comprise the Fifteen Mile Stream project located in Nova Scotia, Canada. The royalty covers all products mined or otherwise recovered from the project.

Brett Heath, president, and chief executive officer of Metalla, commented: "Metalla is pleased to add another high-quality royalty on a growing deposit in Eastern Canada with emerging mid-tier operator Atlantic Gold. Fifteen Mile Stream represents the next leg in the growth at the Moose River consolidated gold mine, which has undergone extensive drilling aimed at expanding the resource." Mr. Heath continued: "Atlantic Gold has quickly established itself as one of Canada's premier operators through the successful commissioning of Moose River on time and within budget. This transaction is consistent with our long-stated strategy of acquiring existing royalties on quality assets with strong operators."

Fifteen Mile Stream

Fifteen Mile Stream is a gold project located 57 kilometres northeast of Atlantic Gold's central milling facility at Touquoy and is readily accessible by highway. The project lies along the same geological trend as other related deposits -- Touquoy, Beaver Dam and Cochrane Hill -- and all are hosted within the same critical stratigraphy and structure, over a strike length of 80 kilometres. The Fifteen Mile Stream project is 100 per cent owned by Atlantic Gold and is being developed as part of Atlantic Gold's multiphase mine plan that was outlined in a prefeasibility report disclosed on Jan. 24, 2018 (see technical report titled "Moose River Consolidated Project, Nova Scotia, Canada, NI 43-101 Technical Report on Moose River Consolidated Phase 1 and Phase 2 Expansion," dated Jan. 24, 2018, and filed on Atlantic Gold's SEDAR profile). The plan stipulates that, following the commissioning of the Touquoy mine and mill, the Fifteen Mile Stream project is to be put into production in 2021 for a total cost of $123-million. The Fifteen Mile Stream project will produce a concentrate that will be trucked and processed at the central milling facility at Touquoy. After the technical report was filed, Atlantic Gold declared commercial production at Touquoy effective on March 1, 2018, as a result of a successful ramp-up of mine and milling facilities at Touquoy on time and within budget.

According to Atlantic Gold, the Fifteen Mile Stream project is expected to produce approximately 80,000 ounces of gold in 2021 in its first year of production. Highlights of the life-of-mine plan at the Fifteen Mile Stream project are for a five-year mine life, which will recover a total of 391,000 ounces of gold at a cash cost of $561 per ounce and generate a 60.9-per-cent pretax internal rate of return (see Atlantic Gold's press release dated Jan. 29, 2018).

The technical report discloses the mineral reserve and resource estimate on the Fifteen Mile Stream project, as shown in the attached tables.

Reserves                  Tonnes     Au grade        Gold 
                           (000s)        (g/t)   (000s oz)

Proven                     2,890         1.25         116  
Probable                   7,910         1.24         316  
Proven and probable       10,800         1.24         432 

Reserves                  Tonnes     Au grade        Gold 
                           (000s)        (g/t)   (000s oz)
  
Measured                   2,710         1.33         116  
Indicated                  7,880         1.33         336  
Measured and indicated    10,590         1.33         452  
Inferred                   6,640         1.12         240  

Notes: Mineral resources have an effective date of 
July 20, 2017, and mineral reserves have an effective 
date of Jan. 24, 2018. Atlantic Gold discloses mineral 
resources that are reported inclusive of those mineral 
resources that have been converted to mineral reserves.  
Mineral resources, which are not mineral reserves, do 
not have demonstrated economic viability.

Since Atlantic Gold completed the resource and reserve estimate, it has drilled an additional 290 holes spanning over 35,000 metres at the Fifteen Mile Stream project, which will be included in an updated resource estimate expected to be released in the first half of 2019.

Royalty purchase agreement

Pursuant to the royalty purchase agreement, Metalla and the seller will enter into an assignment and assumption agreement under which the royalty will be transferred from the seller to Metalla. Metalla expects to close the purchase of the royalty on or about Feb. 12, 2019, and closing of the transaction is subject to customary closing conditions, including receiving TSX Venture Exchange approval. The seller also agreed to transfer restrictions by providing the company with a right to place the consideration shares in the event the seller wishes to sell 1.0 per cent or more of the consideration shares issuable to them.

The consideration shares issued to the seller will be subject to a statutory four-month hold period from the date of their issuance. The agreement was negotiated at arm's length between Metalla and the seller. No brokerage or finders' fees were paid in association with the acquisition of the royalty.

Qualified person

The technical information contained in this news release has been reviewed and approved by Charles Beaudry, geologist, MSc, a member of the Association of Professional Geoscientists of Ontario and the Ordre des Geologues du Quebec, and a consultant to Metalla. Mr. Beaudry is a qualified person as defined in National Instrument 43-101, Standards of Disclosure for Mineral Projects.

About Metalla Royalty and Streaming Ltd.

Metalla is a precious metal royalty and streaming company. Metalla provides shareholders with leveraged precious metal exposure through a diversified and growing portfolio of royalties and streams.

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