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Osisko Gold Royalties Ltd
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Shares Issued 157,469,361
Close 2020-01-07 C$ 12.89
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Osisko Gold returns $336M to shareholders since 2014

2020-01-08 08:19 ET - News Release

Mr. Sandeep Singh reports


Osisko Gold Royalties Ltd. would like to highlight some of the company's recent achievements that will add significant value for its shareholders. In 2019, Osisko announced a total of eight royalty and streaming transactions valued at over $245-million -- ranking the company among the most active participants in the royalty and streaming sector.

Horne 5 silver stream

On Feb. 27, Osisko completed a silver stream with Falco Resources Ltd. for up to 100 per cent of the silver produced from the Horne 5 project located in Quebec, Canada. Deposits to be made by Osisko under the stream agreement are based on milestones related to project advancement. Once in production, the Horne 5 silver stream has the potential to deliver approximately 30,000 gold equivalent ounces (GEOs) to Osisko annually, ranking it second only to the Canadian Malartic royalty in Osisko's royalties and streams portfolio. The creation of the Horne 5 silver stream in 2019 represented a rare opportunity to gain access to meaningful life-of-mine stream in a premier mining jurisdiction without any encumbrances such as buybacks, production thresholds or production caps. Throughout 2020, Falco is expected to continue advancing its project through the permitting process while maintaining its positive dialogue with certain key stakeholders, including the government of Quebec.

Share repurchase

On June 25, Osisko announced a repurchase of 12,385,717 common Osisko shares from a jointly owned subsidiary of certain investment funds managed by Orion Resource Partners representing a total value of $174.6-million. Payment from Osisko to Orion consisted of a combination of cash and the direct transfer of other equities held by Osisko. In a concurrent transaction, Osisko also agreed to sell to separate entities managed by Orion certain other equity securities held by Osisko for cash. The share repurchase transaction was an elegant solution that allowed the company to help Orion reduce its ownership percentage to the benefit of all remaining shareholders, while also providing Osisko with an exit opportunity for certain of its equity holdings.

Sable Resources Ltd. investment agreement

On Aug. 29, Osisko and Sable Resources entered into a strategic investment agreement whereby Osisko agreed to support Sable's exploration activities over a four-year period in exchange for a net smelter return (NSR) royalty of up to 2 per cent covering all of Sable's properties over the period. In backing Sable's excellent team of geoscientists, the strategic investment in Sable provided Osisko with royalty exposure to (among others) over 440,000 hectares in northern Mexico and over 58,000 hectares in the San Juan province of Argentina. Osisko's investment in Sable also included a right of first refusal (ROFR) on all future royalty and streaming transactions by Sable. In the first quarter of 2020, Sable is expected to drill its 100-per-cent-owned Vinata project in Mexico. Sable also received permits for six targets at its Don Julio cluster in Argentina as well as environmental and community permits for its Scorpius project near Ayacucho Peru, which will allow it to systematically test all priority targets throughout the year.

Mantos Blancos SA stream enhancement

On Sept. 3, Osisko Bermuda Ltd. (OBL), a wholly owned subsidiary of the company, announced an agreement with Mantos Copper to enhance its existing silver stream on the Mantos Blancos copper mine in Chile. The stream amendment transaction was part of a comprehensive financing which will enable Mantos Copper to expand the Mantos Blancos sulphide concentrator plant. Benefits to Osisko include (i) additional exposure to a long-life asset with further production upside and mine life extension potential; (ii) immediately increases cash margin per ounce and annual cash flow from the stream; and (iii) increases the value of OBL's existing silver stream on Mantos Blancos. During 2020, Mantos Copper is expected to continue advancing the Mantos Blancos expansion with expected completion in mid-2021.

Barkerville Gold Mines Ltd. acquisition

On Nov. 21, Osisko agreed to acquire 100 per cent of Barkerville Gold Mines, owner of the Cariboo gold project in central British Columbia, Canada. The addition of the Cariboo project to Osisko's portfolio adds a potentially world-class brownfield asset in Canada with a high-quality mineral resource, significant exploration upside, and substantial tailings and mining infrastructure in place. In 2020, one of Osisko's primary objectives will be to obtain third party financing for the Cariboo project while concurrently using the company's expertise in exploration, permitting, mine development and mine finance to keep progressing the project and adding value.

Bralorne NSR royalty

On Nov. 21, Osisko entered into an investment agreement whereby it purchased a 1.2-per-cent NSR royalty from Talisker Resources Ltd. on the historic Bralorne gold project located in southwestern British Columbia, Canada. Osisko's investment in Talisker also included a ROFR on royalty buybacks, and on royalty and stream financings relating to Talisker's land package of over 226,000 hectares in British Columbia. In 2020 Talisker is expected to pursue confirmatory drilling and exploration work at Bralorne while developing new targets at the Spences Bridge property.

Pine Point royalty

On Dec. 3, Osisko and Osisko Metals Inc. announced an agreement pursuant to which Osisko agreed to purchase a 1.5-per-cent NSR royalty on Osisko Metals' Pine Point project located in Canada's Northwest Territories. Pine Point is a brownfields open-pittable, zinc-lead development asset containing an inferred mineral resource of 52.4 million tonnes grading 4.64 per cent zinc and 1.83 per cent lead (6.47 per cent zinc equivalent (ZnEq)), making it the largest pit-constrained zinc camp in Canada. In 2020, Osisko Metals is expected to continue project studies, exploration and community engagement work at Pine Point.

Santana royalty

On Dec. 6, Osisko and Minera Alamos Inc. announced a royalty transaction that fully financed the permitted Santana project to production. Santana, located in Sonora state, Mexico, is a simple heap leach gold project with very low capital requirement that could potentially be put into production in a short time frame of approximately eight months. Once in production, Santana could provide Osisko with 1,000 to 2,000 GEOs per year with the potential to increase with further exploration upside. Minera Alamos is expected to begin construction of the Santana project the first half of 2020.

Capital returned to shareholders

As of today's date, in addition to the above achievements, Osisko has returned approximately $336-million to shareholders in the form of dividends and share buybacks since its inception in 2014. In 2019 alone, Osisko distributed approximately $30-million in dividends and over $184-million through share buybacks.

Qualified person

The scientific and technical content of this news release has been reviewed and approved by Guy Desharnais, PhD, PGeo, director of mineral resources evaluation at Osisko Gold Royalties, who is a qualified person as defined by National Instrument 43-101 -- Standards of Disclosure for Mineral Projects.

About Osisko Gold Royalties Ltd.

Osisko Gold Royalties is an intermediate precious metal royalty company that holds a North American-focused portfolio of over 135 royalties, streams and precious metal offtakes. Osisko's portfolio is anchored by its 5-per-cent NSR royalty on the Canadian Malartic mine, the largest gold mine in Canada. Osisko also holds an equity portfolio of publicly traded resource companies, including a 15.9-per-cent interest in Osisko Mining Inc., a 17.9-per-cent interest in Osisko Metals Inc. and a 19.9-per-cent interest in Falco Resources Ltd.

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