Mr. Alex Black reports
RIO2 ANNOUNCES RECEIPT OF FIRST DEPOSIT OF US$25 MILLION FROM FENIX GOLD STREAM
Rio2 Ltd. has received a deposit payment of $25-million (U.S.) from Wheaton Precious Metals International Ltd. (WPMI) in connection with the previously announced precious metals purchase agreement on Rio2's Fenix gold project in Chile.
The gold stream is a component of the previously announced $125-million (U.S.) to $135-million (U.S.) financing package to fully finance the Fenix gold project to production. Under the gold stream, WPMI will purchase 6.0 per cent of the gold production until 90,000 ounces of gold have been delivered, thereafter dropping to 4.0 per cent of the gold production until 140,000 ounces of gold have been delivered, after which the gold stream will reduce to 3.5 per cent of the gold production for the life of mine from the Fenix gold project. In addition, WPMI will make continuing production payments for gold ounces delivered equal to 18 per cent of the spot gold price until the value of gold delivered to WPMI less the production payments is equal to the total upfront consideration payable by WPMI under the gold stream of $50-million (U.S.), at which point the production payment will increase to 22 per cent of the spot gold price. A second deposit of $25-million (U.S.) will be paid to Rio2 following the receipt of the EIA (environmental impact assessment) approval for the Fenix gold project and subject to satisfaction of certain other customary conditions.
About Rio2 Ltd.
Rio2 is a mining company with a focus on development and mining operations with a team that has proven technical skills, as well as a successful capital markets record. Rio2 is focused on taking its Fenix gold project in Chile to production in the shortest possible time frame based on a staged development strategy. In addition to the Fenix gold project in development in Chile, Rio2 continues to pursue additional strategic acquisitions where it can deploy its operational excellence and responsible mining practices to build a multiasset, multijurisdiction precious metals company.
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