Southern Cross Gold Consolidated Ltd. press release

METALLA REPORTS FINANCIAL RESULTS FOR THE FIRST QUARTER OF 2022 AND PROVIDES ASSET UPDATES

2022-05-13

TSX - Toronto Stock Exchange · Australia · Corporate Finance

Canada NewsWire

(All dollar amounts are in United States dollars unless otherwise indicated)

TSXV: MTA NYSE American: MTA

VANCOUVER, BC , May 13, 2022 /CNW/ - Metalla Royalty & Streaming Ltd. (" Metalla " or the " Company ") (TSXV: MTA) (NYSE American: MTA) announces its operating and financial results for the three months ended March 31, 2022 . For complete details of the condensed interim consolidated financial statements and accompanying management's discussion and analysis for the three months ended March 31, 2022 , 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 www.metallaroyalty.com .

Brett Heath , President, and CEO of Metalla, commented, "The first quarter of 2022 we focused on increasing our near-term cash flow with the amendment to the Beaufor royalty that is expected to be in production in the second half of 2022. We also expect El Realito, which is part of Angico Eagle's La India mine, to start producing in the second half of 2022, which will increase our producing royalties to seven total. Although the market continues to be volatile, we believe Metalla's asset base, and growth profile position the Company to have continued success."

FINANCIAL HIGHLIGHTS

During the three months ended March 31, 2022 , and the subsequent period up to the date of this news release, the Company:

Amended an existing 1.0% NSR royalty on Monarch Mining Corporation's (" Monarch ") Beaufor Mine (" Beaufor "). In consideration for $1.0 million paid in cash to Monarch, Monarch agreed to waive a clause stipulating that payments under the Net Smelter Returns (" NSR ") royalty were only payable after 100 Koz of gold have been produced by Monarch following its acquisition of Beaufor. Payments under this NSR royalty will now begin upon initial production from the property. for the three months ended March 31, 2022 , received or accrued payments on 724 attributable Gold Equivalent Ounces (" GEOs ") at an average realized price of $1,835 and an average cash cost of $5 per attributable GEO (see non-IFRS Financial Measures); for the three months ended March 31, 2022 , generated operating cash margin of $1,830 per attributable GEO, from the Wharf, Joaquin and COSE royalties, the New Luika Gold Mine (" NLGM ") stream held by Silverback Ltd. (" Silverback "), the Higginsville derivative royalty asset, and other royalty interests (see non-IFRS Financial Measures); for the three months ended March 31, 2022 , recognized revenue from royalty and stream interests of $0.7 million , net loss of $2.2 million , and adjusted EBITDA of less than $0.1 million (see non-IFRS Financial Measures); for the three months ended March 31, 2022 , recognized payments due or received (not included in revenue) from the Higginsville derivative royalty asset of $0.6 million (see non-IFRS Financial Measures); on May 14, 2021 , announced the establishment of an at-the-market program (the " 2021 ATM Program ") with a syndicate of agents. Under the 2021 ATM Program the Company may distribute up to $35.0 million (or the equivalent in Canadian dollars) in common shares of the Company. From inception to March 31, 2022 , the Company distributed 1,970,608 common shares under the 2021 ATM Program at an average price of $8.19 per share for gross proceeds of $16.1 million , with aggregate commissions paid or payable and other share issue costs of $0.9 million , resulting in aggregate net proceeds of $15.2 million . For the three months ended March 31, 2022 , the Company distributed 348,443 common shares under the 2021 ATM Program at an average price of $6.88 per share for gross proceeds of $2.4 million , with aggregate commissions paid or payable and other share issue costs of $0.2 million , resulting in aggregate net proceeds of $2.2 million . As of the date of this news release, the Company has distributed a total of 1,990,778 common shares under the 2021 ATM program for gross proceeds of $16.3 million ; and On May 12, 2022 , the Company filed a new final short form base shelf prospectus and a corresponding registration statement on Form F-10 that are intended to replace the base shelf prospectus and Form F-10 registration statement previously filed by the Company in 2020, and to enhance the Company's financial flexibility. In connection with this transition, the Company terminated its 2021 ATM Program.

ASSET UPDATES

Wharf Royalty

On May 4, 2022 , Coeur Mining Inc. (" Coeur ") reported first quarter production of 17.7 Koz gold at 0.78 g/t gold, in line with the 70-80 Koz full year guidance for Wharf disclosed by Wharf on February 16, 2022 . During the quarter, one reverse circulation (" RC ") drill rig continued to infill targets at the Portland -Ridge- Boston claim group and at the Flossie area, results are pending.

On February 16, 2022 , Coeur reported that Wharf's updated Proven and Probable Reserves totaled 852 Koz at 0.73 g/t. Total Measured and Indicated Resources were reported at 412 Koz at 0.63g/t with an Inferred Resource estimate of 90 Koz at 0.75 g/t. In addition, Coeur reported in their Q4 2021 financial statements, an updated mine life of 8 years for Wharf. Additionally, Coeur reported the continued exploration success at Wharf where a total of 6,625 meters of drilling was completed in the Portland Ridge – Boston claim group, Flossie and Juno areas. Coeur spent $4 million on exploration at the mine in 2021, its largest since acquiring the asset in 2015.

Metalla holds a 1.0% GVR royalty on the Wharf mine.

Higginsville Royalty

On April 20, 2022 , Karora Resources Inc. (" Karora ") reported first quarter production of 27,489 ounces of gold from its Higginsville Gold Operations (" Higginsville ") and Beta Hunt mines, in line with 2022 production guidance of 110-135 Koz gold announced by Karora on February 7, 2022 .

Metalla holds a 27.5% PPR royalty interest on the difference between the London PM fix gold price and A$1,340 /oz on the first 2.5 Koz per quarter until a cumulative total of 34.0 Koz of gold at the Higginsville operation have been delivered. As at March 31, 2022 , 16.6 Koz of gold had been delivered.

New Luika Silver Stream

On April 26, 2022 , Shanta Gold Limited (" Shanta ") reported that it produced 11,408 ounces of gold at its NLGM in Tanzania in the first quarter of 2022. On July 19, 2021 , Shanta announced a new mine plan for NLGM, where average annual production is expected to be 73.6 Koz gold with the potential to extend mine life beyond 2026 through conversion of significant known resources and the expanded 2,450 tpd mill throughput. Shanta expects total gold production from NLGM for the five-year plan to total 368 Koz from both open pit and underground mine sources from the mining license. Shanta outlined that the resources presently sitting outside of the mine plan amounts to 552 Koz at 2.37 g/t gold at NLGM. Shanta has forecast production to be between 68-76 Koz in fiscal 2022.

On February 1, 2022 , Shanta reported that as of December 31, 2021 , the Probable Reserves at NLGM stood at 404 Koz at 3.05 g/t gold, the Measured Resources were 105 Koz at 4.94 g/t gold, the Indicated Resources were 707 Koz at 2.63 g/t gold, and the Inferred Resources were 296 Koz at 1.73 g/t gold.

Metalla holds a 15% interest in Silverback Ltd., whose sole business is receipt and distribution of a 100% silver stream on NLGM at an ongoing cost of 10% of the spot silver price.

Côté-Gosselin

On May 3, 2022 , IAMGOLD Corporation (" IAMGOLD ") reported that construction had reached 49% completion at the Côté Gold Project. It also reported completion in the first quarter of 2022 of approximately 4,300 meters of the 16,000 meter drill program is planned in 2022 to further delineate and expand the Gosselin mineral resources and test selected targets along the deposit corridor. On January 27, 2022 , IAMGOLD released assay results that extended the Gosselin Zone outside of the recent mineral resource estimate, significant highlights include 0.78 g/t gold over 355.5 meters, 2.05 g/t gold over 256 meters, 0.55 g/t gold over 357.5 meters and 0.7 g/t gold over 173 meters.

Metalla holds a 1.35% NSR royalty that covers less than 10% of the Côté reserves and resources estimate and covers all of the Gosselin resource estimate.

Castle Mountain

Castle Mountain is slated to become one of Equinox Gold's (" Equinox ") largest assets. Metalla's 5.0% NSR royalty covers the South Domes portion of the deposit which will be part of the Phase 2 expansion slated to begin in 2026.

On May 3, 2022 , Equinox announced exploration at Castle Mountain in the first quarter included 7,948 meters of RC drilling across the South dump area to assess the continuity and distribution of grade. Equinox also completed 1,448 meters of RC drilling in the area between the JSLA and South Domes pits. Equinox also announced that in March 2022 it had submitted applications to amend existing permits to accommodate the Phase 2 expansion. On February 24, 2022 , Equinox announced they expect to spend $7 million for Phase 2 permitting, optimization studies and metallurgical test work and nearly $2 million for exploration.

Metalla holds a 5.0% NSR Royalty on the South Domes area of the Castle Mountain mine.

Garrison

On May 11, 2022 , Moneta Gold Inc. (" Moneta ") released an updated resource estimate for the Tower Gold project, including 4.27 Moz gold in the Indicated category and 7.5 Moz gold in the Inferred category. Moneta plans to complete a Preliminary Economic Assessment on the project scheduled for completion later in the second quarter of 2022. The Garrison deposit forms part of the Tower project and is comprised of three zones, Garrcon, Jonpol, and 903. At Garrcon, the open pit Indicated Resource is 841 Koz at 1.02 g/t gold with an Inferred Resource of 15Koz at 0.67 g/t gold, the underground portion has an Indicated Resource of 87 Koz at 5.08 g/t gold with an Inferred Resource of 120 Koz at 4.98 g/t gold. The Jonpol zone has an Indicated Resource of 297 Koz at 1.4 g/t gold and an Inferred Resource of 114 Koz at 0.99 g/t gold. The 903 zone has an Indicated Resource of 610 Koz at 1.01 g/t gold and an Inferred Resource of 600 Koz at 0.74 g/t gold. The Garrison starter pit now has an Indicated Resource of 1.75 Moz at 1.07 g/t gold. Moneta is slated to release a PEA in June of 2022.

On March 24, 2022 , Moneta released the results of significant step out gold mineralization at the Garrcon pit comprising the Garrison project which confirmed mineralization over a strike length of 750 meters and width of 500 meters beyond the current Garrison project resource. Significant intercepts from recent drilling include 3.05 g/t gold over 67 meters, 1.17 g/t gold over 62.45 meters and 1.26 g/t gold over 54.7 meters. The Garrcon portion of the Garrison project currently hosts an open pit indicated gold resource of 550 Koz gold at 0.82 g/t gold and inferred gold resource of 200 Koz at 0.87 g/t gold.

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Metalla holds a 2% NSR Royalty on the Garrison project.

Wasamac

On April 4, 2022 , Yamana Gold Inc. (" Yamana ") announced that additional drill results at Wasamac continued to infill the Wasamac resource area. Results received to date in the Zone 2 resource area continue to confirm wide mining widths and consistent mineralization with highlights of 3.17 g/t gold over 14.78 meters and 3.41 g/t gold over 5.02 meters. Yamana stated the excellent exploration upside on the property continues to reinforce the potential for a 200 Koz plus per year operation with a mine life of at least 15 years. Work continues to follow up on the exploration drilling at the newly discovered South Wildcat zone returned 7.31 g/t gold over 3.37 meters as announced in a press release dated December 1, 2021 . Yamana has decided to advance a bulk sample permitting process to allow construction of a ramp which could expedite the start of production ahead of the stated 2026 start date. In addition, work is ongoing to understand the metallurgy of the project where preliminary testing indicated that average gold recovery could increase by 3% compared to the feasibility study. Yamana expects to complete the Environmental impact assessment by the second quarter of 2022.

Metalla holds a 1.5% NSR royalty on the Wasamac project subject to a buy back of 0.5% for C$7.5 million .

Amalgamated Kirkland Property

On April 28, 2022 , Agnico Eagle Mines Limited (" Agnico ") reported that the Amalgamated Kirkland deposit could provide incremental ore feed to the Macassa mill with annual production of 40 Koz as soon as 2024. The Macassa underground ramp had been extended by 225 meters and nine drill holes had been completed in the higher-grade portion of the deposit. In 2022, Agnico plans to spend $8.6 million on a 1.3 Km exploration ramp from the Macassa near surface zones, designed to carry out infill drilling and a bulk sample of the higher-grade regions of the Amalgamated Kirkland deposit. The Amalgamated Kirkland deposit hosts an Indicated Resource estimate of 265 Koz gold at 6.51 g/t gold and an Inferred Resource of 406 Koz at 5.32 g/t gold. The deposit remains open at depth and extends laterally.

Metalla holds a 0.45% NSR royalty on the Amalgamated Kirkland property.

El Realito

On April 28, 2022 , Agnico reported that pre-stripping of the El Realito pit was approximately 39% compete and first gold production was started in the first quarter of 2022. Pre-stripping activities at El Realito pit are in line with forecast are expected to be completed in the third quarter of 2022. The production guidance in Agnico's February 23, 2022 , press release for the La India mine which hosts the El Realito pit were positively revised to 82.5 Koz gold in 2022, 70 Koz gold in 2023 and 22.5 Koz gold in 2024. The increase in the production guidance was due to pit optimization and increase in mineral reserves at the El Realito deposit.

Metalla holds a 2.0% NSR royalty on the El Realito deposit which is subject to a 1.0% buyback right for $4.0 million .

Del Carmen

On May 4, 2022 , Barrick Gold Corporation reported that drilling at Del Carmen resumed in the second quarter of 2022, drilling will continue until the winter season. Results received at Carmen Norte, located to the north of the Rojo Grande target, confirmed gold mineralization with an intercept of 0.5 g/t gold over 39 meters, which opens up a new area with upside potential to add resources to Del Carmen. In addition, all geological models grade estimates and geometallurgical models with be updated and rebuilding in the second quarter to inform future steps for the project.

Metalla holds a 0.5% NSR royalty on the Del Carmen project which is the Argentine portion of the Alturas-Del Carmen project in the prolific El Indio belt.

Beaufor Mine

On March 17, 2022 , Monarch provided exploration updates at the Beaufor Mine and Beacon Mill, scheduled to begin mining in 2022. Significant highlights from drilling include 19.05 g/t gold over 6.8 meters, 150 meters west and down dip of the "Q Zone" which is the most continuous ore zone in the mine. Monarch believes these results will significantly boost Beaufor's potential in the Q Zone. Underground development and rehabilitation are currently ongoing at Beaufor.

Metalla holds a 1.0% NSR royalty on the Beaufor mine.

San Luis

On February 23, 2022 , SSR Mining Inc. (" SSR ") provided an update on activities at the San Luis project in Ancash, Peru . Exploration activities in 2021 were undertaken on land belonging to the Ecash community in 2021 and SSR plans to extend exploration activities onto the Cochabamba community lands in 2022.

Metalla holds a 1.0% NSR royalty on the San Luis project.

Fifteen Mile Stream

On April 28, 2022 , St. Barbara Limited reported that the Fifteen Mile Stream project Feasibility Study continued to progress with engineering focused on the tailings facility and geotechnical work, with a completion date slated for September 2023 . Permitting efforts continued during the quarter focused on community consultations and surface and ground water modelling planned for the first half of 2023 to prepare responses for the FMS EIS process.

Metalla holds a 1.0% NSR Royalty on the Fifteen Mile Stream project, and 3.0% NSR Royalty on the Plenty and Seloam Brook deposits.

Santa Gertrudis

On February 23, 2022 , Agnico announced an updated Resource estimate at Santa Gertrudis where the Indicated Resources totaled 99 Koz gold at 0.64 g/t and 739 Koz at 4.79 g/t silver, and Inferred Resources totaled 1,679 Koz at 1.69 g/t gold and 5,924 Koz at 5.96 g/t silver. Exploration drilling in the fourth quarter at the high-grade Amelia deposit resulted in the improved understanding of structural controls leading to the 120-meter extension of the high-grade ore shoots at the deposit beyond the 2021 mineral resources. At the Centauro deposit, a 100-meter step out from a hole that returned 5.8 g/t gold over 15 meters encountered high grade sulphide mineralization outlining the potential to make additional high-grade discoveries at the property similar to Amelia.

Agnico has budgeted $19 million in exploration at Santa Gertrudis with the goal to expand mineral resources, test high grade structure extensions at the Amelia deposit and explore new targets, infill open pit deposits to declare reserves, and internal studies and metallurgical test work. Agnico expects Santa Gertrudis to have an annual production of 100 – 125 Koz of gold.

Metalla holds a 2.0% NSR royalty on Santa Gertrudis subject to Agnico's right to buy back 1.0% for $7.5 million .

Tocantinzinho

On February 9, 2022 , G Mining Ventures Corp (" G Mining ") announced that it had completed an updated feasibility study for the TZ gold project located in Para State, Brazil . The study confirmed a 10.5-year mine life producing 1.8 Moz of gold in total resulting in an average annual gold production profile of 174,700 ounces at an all-in sustaining cost of $681 /oz.

Economics were favourable, at a $1,600 /oz gold price the study demonstrated an after-tax NPV5% of $622 million and generated an after-tax IRR of 24%. Also of note, G Mining increased the reserves at TZ by 12% to 2.0 Moz and saw an increase in the capital cost at the project of only 7% since the last study was conducted. Project optimization and detailed engineering is expected to occur from Q4 2021 through to Q4 2022. G Mining also expects to complete two drilling campaigns totaling 10,000 meters beginning in Q4 2021 through to Q1 2022, these include a grade control drilling program to de-risk early years of production and an exploration drilling program to test for potential extensions of the known mineralization at depth and below the current pit.

G Mining is a precious metals development company with a leadership team which has built four mines in South America , including the Merian mine for Newmont Corporation and Fruta Del Norte for Lundin Gold .

Metalla holds a 0.75% GVR royalty on the Tocantinzinho project.

Fosterville

On February 23, 2022 , Agnico reported that they expect to spend $34.6 million for 121,400 metres of drilling and development to replace mineral reserve depletion and to add mineral resources at the Fosterville mine. Agnico announced that another $19.7 million will be spent on underground and surface exploration with the aim to discover additional high-grade mineralization, with $2.9 million to be spent on regional exploration drilling on the land package surrounding the mine.

Metalla holds a 2.5% GVR royalty on the Northern and Southern extensions of the Fosterville mining license and other areas in the land package.

CentroGold

On April 22, 2022 , Oz Minerals stated that the relocation plan required for progressing the court injunction removal for CentroGold has been submitted to the National Institute of Colonization and Agrarian Reform (INCRA) and is currently under review.

Metalla holds a 1.0-2.0% NSR royalty on the CentroGold project.