Ely Gold Royalties Inc. (ELY:TSX.V; ELYGF:OTCQX; I4U:FSE) announced in a news release that through its subsidiary, Nevada Select Royalty, it agreed to acquire three net smelter returns (NSR) royalties on Nevada properties from prospector Ken Snyder for a total consideration of $350,000 in cash. The transaction is expected to close on Sept. 15, 2020.
"This royalty package adds three excellent Nevada royalties to our portfolio," Nevada Select Royalty President and CEO Jerry Baughman said in the release.
The package includes a 0.33% NSR on the Sleeper mine in Humboldt County, a 1% NSR on 38 unpatented mining claims in Pershing County and a 1% NSR on 40 acres of fee ground in White Pine County.
Sleeper is a past-producing silver-gold project now owned by Paramount Gold Nevada. A 2017 preliminary economic assessment showed Sleeper's Measured and Indicated resources to be 297,126 tons of 0.35 grams per ton gold and 3.2 grams per ton silver. The report outlined an estimated annual production of 102,000 ounces of gold and 105,000 ounces of silver along with $167 million net present value at a 5% discount rate and an internal rate of return of 25%, assuming a $1,300 per ounce gold price.
The 38 mining claims comprising the WR royalty are on Coeur Mining's Lincoln Hill and Gold Ridge properties. The claims are adjacent to another of Ely Gold's Lincoln Hill royalties, a 2% royalty.
The third royalty of the group, the Monte Cristo royalty, covers fee ground at Waterton Global's Mt. Hamilton project, which is fully permitted for mine construction. This is Ely Gold's second Mt. Hamilton royalty.
Trey Wasser, president and CEO of Ely Gold, stated, "This transaction is a testament to our ability to make third-party royalty purchases due primarily to Jerry's long-standing relationships throughout Nevada."
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