Royal Gold, Inc. RGLD has entered into an agreement with Kinross Gold Corporation KGC to sell its shareholding interest in the Peak Gold joint-venture project in Alaska as well as common share holding in Contango Ore, Inc. for cash proceeds of total $61.3 million and increased royal interests.
Royal Gold will receive $49.2 million for the sale of a 40% ownership interest in Peak Gold, LLC, the owner of the Peak Gold project and $12.1 million for selling its holding of 809,744 shares in Contango, Royal Gold’s partner in Peak Gold, LLC.
Additionally, Royal Gold will receive an incremental 28% net smelter return (NSR) royalty on silver produced from the current resource area and an incremental 1% NSR royalty on certain State of Alaska mining, owned by Contango. This will increase Royal Gold’s royalty in this area from 2% to 3%.
Following the deal’s completion, Kinross will be the Peak