08:13:12 EDT Thu 22 Oct 2020
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Ely Gold Royalties Inc
Symbol ELY
Shares Issued 137,348,995
Close 2020-10-08 C$ 1.27
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Ely Gold options Aurora West to Goldcliff

2020-10-08 07:31 ET - News Release

Also News Release (C-GCN) Goldcliff Resource Corp (2)

Mr. Trey Wasser of Ely Gold reports


Ely Gold Royalties Inc., through its wholly owned subsidiary, Nevada Select Royalty Inc., has entered into an option agreement with Goldcliff Resource (U.S.) Inc., a wholly owned subsidiary of Goldcliff Resource Corp., whereby Goldcliff will have the option to acquire a 100-per-cent interest in the Aurora West property located in Mineral county, Nevada. The option agreement was executed on Oct. 7, 2020, and does not require any additional approvals. Nevada Select will retain a 2-per-cent net smelter return royalty (NSR).

The option agreement

Goldcliff may acquire 100 per cent of the Aurora West property for a total purchase price of $425,000 (U.S.) and the option agreement provides for the following payments:

Paying Nevada Select $25,000 (U.S.) at closing;

Paying the third party $50,000 (U.S.) on Sept. 23, 2021;

Paying the third party $135,000 (U.S.) on Sept. 23, 2021 (at which point Nevada Select will take possession of the Aurora West property from the third party);

Making a final payment of $200,000 (U.S.) to Nevada Select on the fourth anniversary of closing.

In addition, Goldcliff will reimburse Nevada Select $9,039 (U.S.) for 2020 claim fees at closing.

The third party will retain a 1-per-cent NSR. The private company royalty may be bought down by 0.5 per cent at any time by payment of $1-million. Nevada Select will retain a 2-per-cent NSR with no buydowns. The option agreement will include a one-mile area of interest. There are no work commitments associated with the option agreement.

The Aurora West property

The Aurora West property consists of 51 claims and is contiguous with the northwest portion of the main Aurora district claims held by Hecla Mining Company. Nevada Select is currently optioning the Aurora West property from a private company. Hecla's holdings include a fully permitted, recently operated 350-tonne-per-day mill.

The Aurora district has historically produced gold from low sulphidation, quartz-adularia bonanza veins. Bonanza grades were mined where these northeast structures were intersected by north-south structures. On the Aurora West claims, the Sawtooth Ridge target is located immediately northwest of the northernmost bonanza vein deposits in the Aurora district. The target consists of a large 1.5-square-mile area of high-level opaline, chalcedonic silica and argillic alteration, hosted by rhyolitic tuffs, flows and shallow intrusive domes. A series of northeast and north trending faults transect the area.

Qualified person

Stephen Kenwood, PGeo, is a director of the company and a qualified person as defined by National Instrument 43-101. Mr. Kenwood has reviewed and approved the technical information in this press release.

About Ely Gold Royalties Inc.

Ely Gold Royalties is a Nevada focused gold royalty company. Its current portfolio includes royalties at Jerritt Canyon, Goldstrike and Marigold, three of Nevada's largest gold mines, as well as the Fenelon mine in Quebec, operated by Wallbridge Mining. The company continues to actively seek opportunities to purchase producing or near-term producing royalties. Ely Gold also generates development royalties through property sales on projects that are located at or near producing mines. Management believes that due to the company's ability to locate and purchase third party royalties, its strategy of organically creating royalties and its gold focus, Ely Gold offers shareholders a favourable leverage to gold prices and low-cost access to long-term gold royalties in safe mining jurisdictions.

We seek Safe Harbor.

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