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Nomad Royalty Company Ltd
Symbol NSR
Shares Issued 565,429,124
Close 2021-01-11 C$ 1.05
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Nomad acquires 0.21% NSR royalty on Blackwater project

2021-01-11 17:37 ET - News Release

Mr. Vincent Metcalfe reports

NOMAD ROYALTY COMPANY ACQUIRES A ROYALTY ON THE BLACKWATER GOLD PROJECT IN CANADA

Nomad Royalty Company Ltd. has completed a royalty purchase agreement with private vendors to acquire an existing net smelter return royalty on the Blackwater gold project located in British Columbia, Canada, for total consideration of approximately $3.0-million (U.S.).

Vincent Metcalfe, chief executive officer of Nomad, commented on the transaction: "We are very pleased to announce the acquisition of a royalty on a large gold deposit with significant potential for resource expansion and with a clear path to development. The Blackwater gold project represents one of the few sizeable near-shovel-ready projects worldwide. Furthermore, the addition of the royalty now adds British Columbia, Canada, to Nomad's growing list of jurisdictions where we own precious-metal royalties and streams."

The Blackwater gold project

The property is located in central British Columbia, approximately 160 kilometres southwest of Prince George, 446 kilometres northeast of Vancouver, and is accessible by major highway and access/service roads. The property is 100 per cent owned and operated by Artemis Gold. The operator has recently revised the development approach for the Blackwater gold project and released a revised prefeasibility study in August, 2020. A definitive feasibility study is currently under way and scheduled for mid-2021. The start of construction is planned for the second quarter of 2022, with anticipated production in 2024.

The royalty

The royalty consists of a 0.21-per-cent net smelter return royalty on all metals and minerals produced from mineral tenure 515809, which covers a portion of the Blackwater gold project and the higher-grade starter pit area.

The Blackwater gold project highlights

The operator's revised development approach includes a reduced initial development capital, a focus on high-grade starter zone located in the southwestern zone of the deposit, and improved gold and silver recoveries. The proven and probable reserves currently stand at 334.0 million tonnes at grades of 0.75 gram per tonne gold and 5.8 g/t silver for contained 8.0 million ounces of gold and 62.3 million ounces of silver.

            BLACKWATER GOLD PROJECT SUMMARY

Location                        British Columbia, Canada
Ownership                                            100%                    
Status                              Prefeasibility study   
Type of mine                          Open pit, CIP mill      
Gold reserves                       Eight million ounces        
Silver reserves                        60 million ounces       
Gold resources                       11.7 million ounces     
Silver resources                    122.4 million ounces    
Phase 1                                        Years 1-5               
Initial development capital                 $592-million         
Throughput                               5.5 million tpa         
Average annual gold production                   248,000                 
AISC ($ oz Au)                                 $508 (U.S.)                  
Phase 2                                       Years 6-10              
Expansion capital                           $426-million         
Throughput                              12.0 million tpa        
Average annual gold production                   420,000                 
AISC ($ oz Au)                                 $529 (U.S.)                  
Phase 3                                      Years 11-17             
Expansion capital                           $380-million         
Throughput                              20.0 million tpa        
Average annual gold production                   442,000                 
AISC ($ oz Au)                                 $529 (U.S.)                  
Phase 4                                      Years 18-23             
Expansion capital                                    Nil                     
Throughput                              20.0 million tpa        
Average annual gold production                   189,000                 
AISC ($ oz Au)                                 $807 (U.S.)                  
LOM                                             23 years                
Payback period                                 2.0 years               
After-tax IRR                                         35%                     
After-tax NPV (5%)                        $2,247-million 

Source: Artemis Gold company filings

The potential resource upside

In November, 2020, the operator began the first 35,000-metre grade control program, which will focus on delineating an area in the southwestern portion of the Blackwater pit (scheduled in the 2020 PFS to be mined in year 1 of operations), which returned significant near-surface, high-grade, mineralized intercepts.

The Blackwater gold project has a high level of drilling density with more than 300,000 metres of diamond drilling previously completed, ultimately supporting its current 2020 PFS mineral resource estimate (with 75 per cent of the measured and indicated mineral resource in the measured category). However, despite the extent of the drilling to date, the deposit remains open to potentially substantial expansion. The deposit remains open to the north, northwest and at depth in the southwest. The operator plans to complete a limited diamond drill program in 2021 to test for extensions to the known mineralization of the deposit in the directions that remain open.

The purchase

The purchase price was satisfied by Nomad paying approximately $1.7-million (U.S.) ($2.2-million) in cash and by the issuance of 1,583,710 shares of the company to the vendor.

Qualified person

Vincent Cardin-Tremblay, PGeo, vice-president, geology, of Nomad Royalty, is the qualified person as defined in National Instrument 43-101 who has reviewed and approved the technical content of this news release.

About Nomad Royalty Company Ltd.

Nomad Royalty Company is a gold and silver royalty company that purchases rights to a percentage of the gold or silver produced from a mine, for the life of the mine. Nomad owns a portfolio of 14 royalty, stream and gold loan assets, of which six are on currently producing mines. Nomad plans to grow and diversify its low-cost production profile through the acquisition of additional producing and near-term producing gold and silver streams and royalties.

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