Ely Gold Royalties Inc. (ELY:TSX.V; ELYGF:OTCQB) announced in a news release it agreed to sell its Gold Bar project in Nevada to McEwen Mining's subsidiary, McEwen Mining Nevada, and thereby retain a related royalty.
"This transaction will be our second transaction with McEwen and fully supports our business model of generating royalty interests at or near producing mines," Ely Gold President and CEO Trey Wasser said in the release.
The asset encompasses 12 patented mining claims and 310 unpatented mining claims, including the past-producing Gold Bar mine and mill and the Millsite deposit northwest of the mine's open pit.
Per the agreement, McEwen will issue to Ely Gold 53,600 of its common shares. Also, McEwen will reimburse Ely Gold's subsidiary, Nevada Select, $38,096.57 for already paid 2020 claim fees and taxes.
Nevada Select will retain a 2% net smelter return royalty on the patented and unpatented Claims. McEwen will have the option to purchase 1% of the royalty on the patented claims for $1 million and 1% of the royalty on the unpatented claims for $2 million.
Ely Gold will own three property or royalty interests at McEwen's Gold Bar complex in Nevada once this transaction and Ely Gold's Gold Canyon deal with Fremont close.
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