Golden Goose Resources Corp. press release
Metalla Reports Audited Financial Results for Fiscal 2020 and Provides Asset Updates
CSE - Canadian National Stock Exchange · Gold · Lithium · Silver · Copper · Canada
Canada NewsWire
VANCOUVER, BC, Aug. 21, 2020
(All dollar amounts are in Canadian dollars unless otherwise indicated)
TSXV: MTA NYSE American: MTA
VANCOUVER, BC, Aug. 21, 2020 /CNW/ - Metalla Royalty & Streaming Ltd.("Metalla" or the "Company") (TSXV: MTA) (NYSE American: MTA) announces its operating and financial results for the year ended May 31, 2020. Metalla has also filed with the U.S. Securities and Exchange Commission (the "SEC") its SEC Annual Report on Form 40-F for the year ended May 31, 2020. The Form 40-F includes the Company's Annual Information Form, audited financial statements and management's discussion & analysis for the year ended May 31, 2020. For complete details of the consolidated financial statements and accompanying management's discussion and analysis for the year ended May 31, 2020, please see the Company's filings on SEDAR (www.sedar.com) or on EDGAR (www.sec.gov). Shareholders are encouraged to visit the Company's website at http://www.metallaroyalty.com/.
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Metalla shareholders may receive a hard copy of the Company's complete audited financial statements for the year ended May 31, 2020, free of charge, upon request. For further information please visit the Company website at https://www.metallaroyalty.com/financial-reports/.
Brett Heath, President and CEO of Metalla commented, "2020 represented another major year of growth for Metalla's royalty portfolio and corporately with the NYSE listing. We feel confident that our portfolio has reached critical mass and will provide the Company the platform to continue to scale our business, and shareholders an excellent way to participate in the gold and silver bull market. We are excited about the new opportunities in front of us and to see many of our assets having exploration success while being advanced toward production by our first-class counterparties."
FINANCIAL HIGHLIGHTS
During the year ended May 31, 2020, and the subsequent period, the Company:
increased the number of royalties and streams held to a total of 50 precious metal assets through the following notable transactions:
recognized revenue on 178,624 (2019 – 431,844) attributable silver ounces ("oz.") at an average realized price of US$17.24(2019 - US$15.33) and average cash cost of US$6.58(2019 - US$6.27) per oz. (see non-IFRS Financial Measures);
generated operating cash margin of US$10.66(2019 - US$9.06) per attributable silver oz. from the Endeavor silver stream, New Luika Gold Mine ("NLGM") stream held by Silverback Ltd. ("Silverback"), and other royalty interests (see non-IFRS Financial Measures);
recognized revenue from royalty and stream interests of $3.6 million(2019 - $7.9 million), net loss of $5.8 million(2019 - $2.4 million), and adjusted EBITDA of negative $1.9 million(2019 - positive $2.1 million) (see non-IFRS Financial Measures);
paid $1.6 millionin dividends during the year ended May 31, 2020(2019 - $1.8 million). No dividends have been paid or declared for the months of June to August due to the impact of COVID-19;
completed the secondary listing of its common shares on the NYSE and concurrently completed a consolidation of its common shares on the basis of one new share for four old shares (1:4). All shares and per share information has been restated on a retroactive basis to give effect to the share consolidation;
Coeur completed a secondary public offering of 3,910,000 common shares of the Company previously held by it, at a price of US$5.30per common share for gross proceeds of US$20.7 million(the "Secondary Offering"). The net proceeds of the Secondary Offering were paid directly to Coeur. On June 30, 2020, following the close of the Secondary Offering and the Wharf transaction, Coeur's ownership of the Company's common shares decreased from 14.9% to 2.5%; and
in August 2019, drew down the initial advance of $7.0 millionon its $12.0 millionconvertible loan facility with Beedie Capital ("Beedie") and repaid all other loans payable which had an aggregate principal balance of US$2.0 million; in August 2020, the Company amended the convertible loan facility with Beedie whereby Beedie will convert $6.0 millionof the $7.0 millioninitial advance, the Company will drawdown the remaining $5.0 millionfrom the original loan facility with the conversion repriced from $5.56to $9.90and Beedie would make an additional $20.0 millionavailable to the Company to fund future acquisitions. On August 6, 2020, Beedie converted $6.0 millionat $5.56per share for a total of 1,079,136 shares and the company drew down the remaining $5.0 millionwith a revised conversion price of $9.90from the original loan facility.
ASSET UPDATES
COSE & Joaquin Royalties
Metalla received its first royalty payments on Cap-Oeste Sur East ("COSE") and Joaquin for production in fiscal 2020. Revenue totaled $90,273and was related to mainly development ore shipped to the Manantial Espejo plant. Both mines were scheduled to ramp up to commercial production during the first two calendar quarters of 2020 but have been delayed due to COVID-19 mandatory shut down of operations by the Argentinagovernment.
On April 2, 2020, a new decree was issued by the government of Argentinato expand the list of exemptions that will include mining production as essential for the Argentine economy. Although mining production is now permitted again, Pan American Silver Corp. ("Pan American") has kept the operations running at a reduced rate for the first half of the calendar year 2020. The impact of these suspensions on mining production levels and resulting cash flow to Metalla is difficult to predict.
Pan American later reported by news release on August 5, 2020, operations at Pan American's COSE & Joaquin mine resumed on May 4, 2020, with high-grade ore being stockpiled on-site. Pan American expects to begin hauling mined ores from COSE and Joaquin to the processing plant in the third quarter of 2020.
Metalla holds an NSR royalty of 1.5% and 2.0% on COSE and Joaquin mines, respectively.
New Luika Silver Stream
Shanta Gold Limited ("Shanta") disclosed in their news release on January 16, 2020that their annual production for 2019 totaled 84.5 thousand oz. of gold, ahead of their guidance of 80-84 thousand oz. for the year at the New Luika Gold Mine ("NLGM") located in Tanzania. Shanta also announced that it added 135 thousand oz. of gold reserves to the current mine plan during the year, net of depletion.
For 2020, Shanta has disclosed guidance of 80-85 thousand Au oz. and a 65% increase in its exploration budget to US$5 millionover 2019. Shanta has reported its first net cash position in its 2020 second quarter financial statement, completing a period of deleveraging.
Metalla holds a 15% interest in Silverback Ltd. whose sole business is receipt and distribution of a silver stream on NLGM at an ongoing cost of 10% of the spot silver price.
Endeavor Mine Silver Stream
After decades of successful operation, the operator of the Endeavor Mine, located in Cobar, Australia, CBH Resources Limited ("CBH") suspended mining operations at the Endeavor Mine in December 2019and placed it into care and maintenance. The current focus for a potential future resumption of mining is the recent discovery of the Deep Zinc Lode at depth and a potential open pit scenario that was originally outlined in a historic study completed in 2007.
Metalla has the right to buy 100% of the silver production up to 20 million ounces (12.6 million ounces remaining under the contract for delivery) from the Endeavor Mine for an operating cost contribution of US$1.00per ounce of payable silver, indexed annually for inflation, plus a further increment of 50% of the silver price in excess of US$7.00per oz.
Santa Gertrudis
The Santa Gertrudisgold property of Agnico Eagle Mines Limited ("Agnico") is located approximately 180 kilometres north of Hermosilloin Sonora, Mexico. During the first half of 2020, Agnico continued their US$10.4 Milliondrill program at Santa Gertrudiswith a focus on expanding and testing new targets. In a press release dated July 29, 2020, Agnico announced further expansion of the Amelia deposit, effectively expanding the potential high-grade resource base, and the extension of oxide mineralization at both the Trinidad Trend and Toro Zone. At Amelia, drilling intersected high-grade gold structures below the current underground resource including 6.1 g/t gold and 122 g/t silver over 6.3 metres and 1.9 g/t gold and 5 g/t silver over 10.2 metres. At Espiritu Santo drilling continued to intersect high-grade gold and silver mineralization with notable intercepts of 1.5 g/t gold and 2 g/t silver over 3.7 metres and 2.7 g/t gold and 321 g/t silver (uncapped silver value of 1,101 g/t) over 3.3 metres. Drilling at the El Torotrend tested targets in the upper oxide portions of historical opens pits which will be amenable to heap-leach processing, intersecting 1 g/t gold and 1 g/t silver over 21.3 metres and 2.8 g/t gold and 2 g/t silver over 9.5 metres.
In a press release dated April 30, 2020, Agnico announced it had intersected high-grade gold at Amelia demonstrating the deposit remains open along strike and depth with hole 308 intersecting five high-grade structural commonly found at the bottom of the resource: 3.7 g/t gold over 6 metres, 3.3 g/t gold over 13 metres and 5.3 g/t gold over 10 metres. Beneath the underground resource, three step-out holes intersected high-grade gold of 3.1 g/t over 3.5 metres, 2.8 g/t over 22.5 metres and 3.5g/t over 4 metres, demonstrating the possibility to expand the resource base.
At the Espiritu Santo deposit, drilling demonstrated that shallow gold and silver mineralization continues to the south west of the deposit with high grade intercepts such as 3.7 g/t gold and 424 g/t silver over 3 metres and 3.5 g/t gold and 7 g/t silver over 11.5 metres.
On February 13, 2020, Agnico released an updated resource estimate at Santa Gertrudiswith its first indicated resource of 104,000 ounces (5.1 million tonnes at 0.64 g/t gold) and an inferred resource of 1.2 million ounces (22.1 million tonnes at 1.64 g/t gold). The resource estimate did not encompass its post-Q4 2019 drilling that extended mineralization along strike, depth and the new discovery at Espiritu Santo.
Through the success of drilling in 2019, Agnico declared an initial inferred resource estimate of 521,000 ounces of gold at Amelia. Agnico expects the year resource estimate for Amelia to increase substantially and to declare the initial resource estimate of Espiritu Santo by year-end 2020.
Agnico's disclosure on its website states that it believes the Santa Gertrudisproject has the potential to be a similar size operation to La India which produced over 82Koz of gold in 2019 and is currently evaluating plans to incorporate a heap leach operation for the low-grade ore and a mill for the high-grade underground ore.
Metalla holds a 2.0% NSR on the Santa Gertrudisproperty.
Fifteen Mile Stream
Fifteen Mile Stream(FMS) is part of St. Barbara Limited's Atlantic Gold Operation and is anticipated to be developed to provide ore to the 2.0 million tonne per year processing facility currently operated by St. Barbara. St. Barbara disclosed in their news release on July 29, 2020, that the Federal Environmental Impact Statement was being revised based on comments received. First Nations consultations and scientific studies are progressing well with another submission anticipated in September 2020. Updates to the reserves and resources are expected on August 24, 2020.
St. Barbara disclosed in their news release on January 22, 2020, they continue to have exploration success at FMS as it continues to enlarge the planned reserve pits and delineate potential satellite pits along trend. At Seloam Brook, 700 metres west of the Plenty deposit, significant mineralization was intercepted suggesting the potential to be a pit extension of the main Fifteen Mile Stream proposed pits. Notable near surface highlights include 1.19 g/t over 6 metres and 2.85 g/t over 3 metres.
At the main Hudson and Egerton MacLeanzones, shallow high-grade mineralization has been discovered that will aid in connecting the Egerton and Hudson pits. The best result was 3.21 g/t at 6 metres. West of Egerton, St. Barbara intercepted lateral continuity of shallow mineralization 100 metres west of the current resource with a 1.98 g/t over 7 metres. East of Egerton-MacLean and west of 149, the gap continues to be shortened as mineralization was intercepted at 6.84 g/t over 1 metre. At the 149 deposit, drilling continued to confirm the potential for 149 to be a satellite pit for Fifteen Mile Stream. Extensional drilling 60 metres to the east intercepted 0.86 g/t over 56 metres and 1.03 g/t over 16 metres near surface. Drilling to the south of identified a disseminated halo of mineralization extending over 230 metres of strike length with notable hits of 1.41 g/t over 6 metres and 1.39 g/t over 11 metres. 400 metres east of the 149 Deposit, initial results suggest that mineralization may extend into a new zone called 149 extension intercepting 1.31 g/t over 22 metres.
Metalla holds a 1% NSR on the Hudson, Egerton-Maclean, 149 and the majority of the Plenty deposit and a 3% NSR on the remainder of Plenty and Seloam Brook.
El Realito
El Realitois part of Agnico's La India mine project, which is located approximately 200 km east of Hermosilloin Sonora, Mexico. On July 29, 2020, Agnico reported that drilling success at the nearby sulphide target Chipriona warranted a study on processing sulphides originating from Chipriona and beneath other oxide mineral resources within the La India property including El Realito. Drilling in the other half will be focused on investigating gold-sulphide mineralization below the oxide mineral resources at La India.
Agnico reported on July 31, 2020, that on April 2, 2020, the Government of Mexicomandated that all non-essential businesses, including mining and exploration, suspend operations (the "Decree"). Pursuant to the Decree, mining and exploration activities at Agnico's Mexican operations and exploration sites (Pinos Altos, Creston Mascota, La India and Santa Gertrudis) ramped down. Given the ore stacked on the leach pads in previous months, residual leaching continued at Creston Mascota and La India during the suspension period. On May 14, 2020, the Government of Mexicodesignated mining as an essential activity and permitted the full restart of mining and exploration activities. Agnico's mining operations in Mexicoresumed some pre-production activities on May 18, 2020with employees being gradually reintegrated. Operations resumed fully on June 1, 2020.
Agnico reported on February 13, 2020ongoing drilling success at its El Realitoproject located adjacent to its operating La India Mine in Sonora, Mexico. The success has resulted in a new probable reserve estimate of 106,000 ounces of gold and 485,000 ounces of silver (4.7 million tonnes at 0.71 g/t gold and 3.24 g/t silver). In addition to the aforementioned reserves, El Realitocurrently has a measured resource of 21,000 ounces of gold and 149,000 ounces of silver (1.2 million tonnes at 0.55 g/t gold and 3.89 g/t silver), indicated resource of 17,000 ounces of gold and 83,000 ounces of silver (0.7 million tonnes at 0.71 g/t gold and 3.48 g/t silver and an inferred resource of 4,000 ounces of gold and 24,000 ounces of silver (0.3 million tonnes at 0.47 g/t gold and 2.64 g/t silver)
Agnico has budgeted US$3.3 millionfor 17,000 metres of drilling at La India for 2020.
Metalla holds a 2.0% NSR on the El Realitoproperty.
Hoyle Pond Extension
Metalla owns a 2.0% NSR royalty payable by Newmont on the Hoyle Pond Extension, located on claims that are beneath the Kidd metallurgical complex and immediately adjacent to the east and northeast of the Hoyle Pond mine complex. There is a 500,000 oz. gold exemption on the leased mining rights. As of the end of 2019, approximately 3,560 ounces of gold were produced from Metalla's royalty claims and total reserves of 82,650 tonnes of 12.5 g/t for 33,252 ounces of gold and measured resources of 203,028 tonnes at 14.8 g/t for 96,382 ounces of gold. Drilling is expected to continue in 2020 with a budget of 20,000 metres on the extension.
Wasamac
On May 14, 2020, Monarch Gold Corporation ("Monarch") entered into a memorandum of understanding ('MOU") with Glencore PLC in connection with the potential use of the Kidd concentrator in Timminsfor the treatment of ore to be mined from the Wasamac Gold property. As a result of the MOU, Monarch awarded the concentrator study contract to Ausenco on June 22, 2020. Subsequently, Monarch entered into an MOU with Ontario Northland Railway for the transport of ore from Wasamac to the Kidd concentrator on July 9, 2020.
Metalla holds a 1.5% NSR on the Wasamac project subject to a 0.5% buyback for $7.5 million.
Beaufor Mine
Monarch has outlined their intentions to re-start underground operations at the Beaufor mine in Val-d'Or, Quebecwithin 12-18 months. Concurrently, Monarch will begin a drilling program to focus expanding resource blocks with a focus on high-grade zones. On May 7, 2020, Caisse de depot et placement du Quebecinvested $5 millioninto the project to support the potential re-opening of the mine.
Metalla holds a 1.0% NSR on the Beaufor mine once Monarch has produced 100,000 ounces of gold from the property.
San Luis
On February 20, 2020, SSR Mining Inc. ("SSR") declared that they plan to initiate a detailed mapping program in 2020 at the San Luisproject located in Peru. The mapping program will focus on the land near the mineral resources on the project to potentially expand the mineral resource on the project.
Metalla holds a 1% NSR on the San Luisproject.
Aureus East
On July 17, 2020, Aurelius Minerals Inc. announced the closing of their $4.4 millionequity financing. The proceeds of the financing will be used to define resources, refine into reserves and reengineer a mine plan for the Aureus mine. On August 5, 2020, Aurelius announced the discovery of 2,700 metres of unsampled drill core from the Aureus East and Aureus West projects following historical drill programs completed by the previous operator.
Metalla holds a 1.0% NSR on the Aureus East mine
Zaruma
Titan Minerals Ltd. ("Titan") announced by news release on January 14, 2020, they have been successful in their offer to purchase all of the issued and outstanding common shares of Core Gold, the owner of the Zaruma mine in Ecuador. On May 25, 2020, Titan stated publicly that they plan on a potential sale of Zaruma and are evaluating options in calendar year 2020.
Metalla holds a 1.5% NSR on the Zaruma mine.
NuevaUnión
Shortly after announcing our acquisition of a gold royalty on NuevaUnión by press release on February 18, 2020, Newmont and Teck, who jointly operate the project, filed an environmental impact statement for the project with the Chilean authorities. The filing involves a planned expenditure of US$152 millionfor drilling and other work intended to form the basis for development of a mining plan.
Metalla holds a 2.0% gold NSR on a portion of the NuevaUnión project.
Anglo/Zeke
In Q1 2020, Nevada Gold Mines completed a step out drill program east of the Goldrush deposit in Nevadato build a geological framework critical to identifying concealed targets. In Q2 2020, it was reported that all three step-out holes intersected anomalous Carlin-type geochemistry. One hole returned 4 metres at 1.2 g/t Au in a structural zone above favorable host rock, Barrick, the operator of the Nevada Gold Mines joint venture, has stated this hole warrants follow-up drilling down dip where geologic interpretation suggests it could cut more favorable reactive carbonate rocks. Other observations from drilling include overthickened sections of favorable carbonate host rocks and metasomatism which is an important marker as the best deposits in the Cortez camp are found near metasomatic fronts.