MONTRÉAL, July 12, 2022 (GLOBE NEWSWIRE) — Osisko Gold Royalties Ltd (the “Corporation” or “Osisko”) (OR: TSX & NYSE) is pleased to provide an update on its second quarter 2022 deliveries, revenues, cash margins and recent asset advancements for its royalty and stream segment.

PRELIMINARY Q2 2022 RESULTS

Osisko earned approximately 22,240 attributable gold equivalent ounces1 (“GEOs”) in the second quarter of 2022, record deliveries for the Corporation since inception in 2014.

Osisko had record preliminary revenues from royalties and streams of C$51.5 million during the second quarter and preliminary cost of sales (excluding depletion) of C$3.7 million, resulting in a record quarterly cash margin2 of approximately C$47.8 million or approximately 93%.

Osisko will provide full production and financial details with the release of its second quarter 2022 results after market close on Tuesday, August 9th, 2022 followed by a conference call on Wednesday, August 10th at 10am ET. More details are provided at the end of this release.

Sandeep Singh, President and CEO of Osisko commented: “Our royalty and streaming portfolio delivered records on a number of fronts in Q2 including GEO deliveries and absolute cash margins. We continue to expect further increases in deliveries in the second half of the year as ramp-ups at Mantos and Eagle progress towards nameplate capacity. In a period of heightened volatility in the mining sector, and rising costs across all facets of the economy, our inflation protected business model continues to thrive.”

PORTFOLIO UPDATE

CSA Transaction Update

On June 1st, Metals Acquisition Corp. (“MAC”) published a technical study for the CSA mine (“CSA”) in New South Wales, Australia. This follows MAC’s announcement in March that it had entered into a definitive agreement with a subsidiary of Glencore plc for the acquisition of CSA (the “Acquisition Transaction”). The study suggests the potential for a mine life in excess of 15 years, as well as the significant exploration potential on the large land package.

MAC is in the process of completing the necessary regulatory reporting requirements and associated financing arrangements to conclude the Acquisition Transaction. Closing of the Acquisition Transaction is subject to, among other things, the approval of MAC’s shareholders, and is expected to be completed in Q4 2022.

Osisko Bermuda Limited (“OBL”), a wholly-owned subsidiary of the Corporation, has entered into an agreement with MAC with respect to a US$90 million silver stream to facilitate MAC’s acquisition of the CSA mine. Closing of the silver stream is subject to, among other things, closing of the Acquisition Transaction.

OBL has also provided MAC with a mutual option to draw up to an additional US$100 million in upfront proceeds through the sale of a copper stream, subject to the parties finalizing definitive terms and conditions. MAC has granted OBL a right of first refusal to purchase any royalties or streams on any asset owned by MAC for three years following the closing of the Acquisition Transaction.

Canadian Malartic Update

On July 7th, Yamana Gold Inc. (“Yamana”) reported that Canadian Malartic produced 174,372 ounces of gold during the second quarter, ahead of plan. Permitting at the Odyssey project remains on schedule while construction is on track and on budget with first production from Odyssey South expected in the first quarter of 2023. Fifteen drills are active on the property, with three underground drills completing infill drilling on the Odyssey South deposit and 12 surface drills focused on infilling and expanding the East Gouldie mineralization. Shaft sinking is expected to begin in the fourth quarter of 2022.

On April 28th, Yamana indicated that it firmly believes that in its 10-year outlook period, exploration efforts will lead to more mining areas that will allow it to take advantage of available plant capacity, resulting in ore processing that will exceed 20,000 tonnes per day, and sustainable production will then significantly exceed the initial production plan of 500,000 to 600,000 gold ounces per year.

Agnico Eagle: Kirkland Lake Updates

On April 28th, Agnico Eagle Mines Limited (“Agnico Eagle”) confirmed it is evaluating the potential integration of the AK deposit and the Upper Beaver project with the existing regional infrastructure in Kirkland Lake. In the first quarter of 2022, Agnico Eagle progressed the development of an exploration decline from the existing Macassa infrastructure towards the AK deposit. The decline is associated with an exploration campaign planned to be completed in 2022 to better delineate the deposit and understand how the AK mineral resources could complement the feed at the Macassa mill, potentially starting in 2024.

Infill drilling of the AK deposit from surface was initiated in the first quarter of 2022, targeting one of the higher grade mineral resource areas where historical hole KLAKC15-87 intercepted 8.8 grams per tonne (“g/t”) gold over 14.0 meters (core length) at a depth of 104 meters. Exploration drilling is also underway at Upper Beaver to investigate new mineralized zones at depth along strike laterally. Recent drilling appears to have encountered a new zone of mineralization 500 meters southeast of the main mineralized zone.

Osisko Development Corp. Updates

On May 24th, Osisko Development Corp. (“Osisko Development”) announced the results of a preliminary economic assessment (“PEA”) for the Cariboo Gold Project in central British Columbia. The PEA illustrates the potential for a low cost, large scale, underground gold mine, with average annual gold production of approximately 236,000 ounces at an all-in sustaining cost (“AISC”) per ounce of US$962 over an initial 12 year mine life.

On May 30th, Osisko Development closed its previously announced acquisition of Tintic Consolidated Mines LLC (“TCM”). TCM owns the producing Trixie test mine (“Trixie”), as well as mineral claims covering more than 17,000 acres (including 14,200 acres of which are patented) in Central Utah’s historic Tintic Mining District (together with Trixie, the “Tintic Project”). Osisko Development is currently expanding underground development and utilizing one underground diamond drill rig and one surface reverse circulation rig to aid in the delineation of an initial mineral resource estimate. Concurrently, Osisko Development intends to complete advanced technical studies to generate additional surface and underground targets, conduct metallurgical testing, geotechnical work and environmental studies to justify further development as well as increase production at Trixie through a low-capital expenditure expansion.

Concurrently with the closing of the TCM acquisition, Osisko Development announced that TCM had entered into a binding term sheet with OBL for a stream on the metals produced from the Tintic Project. Under the stream, OBL will make an upfront cash payment to TCM totaling US$20 million in return for 2.5% of all metals produced from the Tintic Project at a purchase price of 25% of the relevant spot metal price. Once 27,150 ounces of refined gold have been delivered, the stream rate will decrease to 2.0% of all metals produced. Closing of the stream is expected to take place in Q3.

On June 30th, Osisko Development reported an updated resource estimate on the San Antonio project. Indicated Resources include 14.9 Mt grading 1.2 g/t gold for 576,000 oz and Inferred Resources include 16.6 Mt grading 1.02 g/t gold for 544,000 oz. The resources are limited to a 2.8km long segment of the prospective 10km long trend. Osisko Development has completed construction of a leach pad and carbon in column plant to process 1.1 Mt of stockpiled material with an average grade of 0.57 g/t gold. Osisko expects first gold deliveries from San Antonio in early Q3.

During the second quarter, Osisko Development closed its two previously announced private placements of subscription receipts for aggregate proceeds of US$167.7 million and announced that its common shares commenced trading on the New York Stock Exchange under the symbol “ODV”. As of June 30th, Osisko owns approximately 44.1% of Osisko Development.

Island Gold Phase 3+ Expansion Study

On June 29th, Alamos Gold Inc. (“Alamos”) reported the results of the P3+ Expansion Study for the Island Gold mine, outlining an increase in production to 2,400 tonnes per day from the current 1,200 tonnes per day. This is an increase over the 2021 study which had planned a 2,000 tonne per day mill throughput, and will be enabled by a new shaft with an initial depth of 1,373 meters. This new PEA estimates average gold production of 287,240 ounces per year for 13 years starting in 2026. The mineral inventory considered in the study includes Probable Reserves of 4.1 Mt grading 10.1 g/t gold for 1.1 Moz and Inferred Resources of 8.3 Mt grading 11.3 g/t gold for 3.0 Moz. Earthworks and shaft surface infrastructure construction have started, with shaft sinking scheduled to commence in the second half of 2023. Alamos plans to continue to aggressively explore at depth and along strike to expand the resources, including 57.5km of drilling planned for 2022. Osisko will see its average royalty rate increase to a blended 2.25% NSR royalty on Alamos’ Island Gold Phase 3+ mine plan.

A graph accompanying this announcement is available at https://www.globenewswire.com/NewsRoom/AttachmentNg/c6e6e583-b987-4b15-95a3-36fb23b32e08

Source: https://www.alamosgold.com/news-and-events/default.aspx#news–widget

see & read more on
https://osiskogr.com/en/osisko-announces-record-preliminary-q2-2022-deliveries-revenues-and-cash-margin/