SANDSTORM METALS & ENERGY ANNOUNCES SECOND QUARTER RESULTS
- Sandstorm Metals & Energy Ltd. has released its unaudited results for the second quarter ended June 30, 2013 (all figures in U.S. dollars).

Second quarter summary
Acquired a 1.2-per-cent base metal net smelter return royalty (NSR) on the Prairie Creek project in the Northwest Territories, Canada, from Canadian Zinc Corp. for $6.8-million;
Net loss of $13.4-million primarily due to a non-cash impairment charge of $12.1-million related to the natural gas stream with Thunderbird Energy Corp.

Sandstorm's president and chief executive officer, Nolan Watson, commented: "During and subsequent to the end of the second quarter, the financial challenges facing some of our partner companies have been at the forefront. We have been working extremely hard to maximize value for shareholders in the current market climate and will continue to do so."

Current streams

Sandstorm has a portfolio of four commodity streams and one base metal NSR as follows:

Serra Pelada mine -- palladium stream

Sandstorm has a palladium stream with Colossus Minerals Inc. to purchase 35 per cent of the palladium produced from the Serra Pelada mine at $100 per ounce. Serra Pelada is a high-grade gold-platinum-palladium mine that is expected to initiate gold production at the end of 2013, with platinum and palladium production beginning at the end of 2014. Colossus has substantially completed its bulk sample program, is continuing development within the Central Mineralized zone and is building a stockpile of ore ahead of process plant commissioning. Colossus recently announced that it had encountered challenges with dewatering wells and pumps in the Central Mineralized zone at Serra Pelada, but Sandstorm does not currently anticipate this to affect the aforementioned development timeline for the platinum-palladium flotation circuit.

Bracemac-McLeod mine -- copper stream

Sandstorm has a copper stream with Donner Metals Ltd. to purchase 24.5 per cent of the copper produced from the Bracemac-McLeod mine at 80 cents per pound (subject to adjustment if the spot price of copper falls below $2.75 per pound, in which case the payments will decrease to 55 cents per pound). Bracemac-McLeod is operated by Glencore Xstrata PLC, and the mine has initiated production. The company amended its copper-stream agreement with Donner to waive the requirement for Donner to sell copper to Sandstorm during the 2013 calendar year. This amendment has been made in order to better allow Donner to meet its working capital obligations that arise under its joint venture agreement with project operator Glencore Xstrata. Donner recently raised approximately $3-million (Canadian) through a brokered private placement, but will need additional funds to maintain its joint venture interest in Bracemac-McLeod. Donner continues to pursue financing alternatives in order to meet the continuing financial obligations under the joint venture.

Hugo North extension and Heruga -- copper stream

Sandstorm has a copper stream with Entree Gold Inc. to purchase 2.5 per cent of Entree's 20-per-cent share of the copper produced from the Heruga and Hugo North extension deposits at 50 cents per pound. The deposits are on the Entree-Oyu Tolgoi LLC joint venture property, which forms part of the world-class Oyu Tolgoi copper mining complex.

Prairie Creek project -- zinc-lead royalty

Sandstorm has a 1.2-per-cent base metal NSR on the Prairie Creek project owned by Canadian Zinc Corp. Prairie Creek is a zinc-silver-lead project that currently reports a proven and probable mineral reserve of 5.2 million tonnes grading 9.4 per cent zinc, 151 grams per tonne silver and 9.5 per cent lead. Sandstorm has granted Canadian Zinc an option, exercisable prior to Nov. 30, 2015, to repurchase the NSR, provided that Canadian Zinc enters into a commodity stream with Sandstorm that has an upfront deposit of no less than $90-million. In addition, Canadian Zinc has provided Sandstorm with a right of first refusal on any future royalty or commodity-stream financing for Prairie Creek. Canadian Zinc holds permits for the exploration and development of Prairie Creek and is moving through the final stages of the Type A water licence, which is required to operate the mine. Lead sulphide, zinc sulphide and lead oxide concentrates will be produced at site and then transported to a smelter. Exploration drilling around the mine site and north of the existing resources is continuing.

Gordon Creek property -- natural gas stream

Sandstorm has a natural gas stream with Thunderbird to purchase 35 per cent of the natural gas produced from the Gordon Creek property at $1 per thousand cubic feet (plus 20 per cent of the price received that is above $4 per thousand cubic feet). Given Thunderbird's negative working capital, Sandstorm has been in discussion with the company to modify the terms of the natural gas stream to better allow Thunderbird to raise additional third party capital. These factors and the lack of progress with respect to Thunderbird's drilling commitments prompted the company to evaluate its investment in Thunderbird. As a result of its review and circumstances specific to certain assets, the company recorded an impairment charge to the Thunderbird natural gas stream in the amount of $12.1-million during the three months ended June 30, 2013. Sandstorm believes any future restructuring associated with Thunderbird will provide Sandstorm with the opportunity to extract value from its initial investment.

Sandstorm's second quarter results for the period ended June 30, 2013, are available on SEDAR and on the company's website. The company will not be holding a conference call in conjunction with the second quarter results, but intends to hold a corporate update conference call during the third quarter.

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