Nova Royalty increases royalty interest in world class Taca Taca copper-gold project to 0.42%
Nova Royalty Corp (CVE:NOVR) (OTCMKTS:NVARF) announced Monday it is increasing its royalty interest in the Taca Taca copper-gold project to 0.42%.
In a deal with the project’s owner First Quantum Minerals, Nova will acquire a combined, existing 0.18% net smelter return (NSR) royalty on the Argentinean project in a cash-and-shares deal worth US$16 million.
The Vancouver-based royalty company already owns a 0.24% royalty interest in Taca Taca.
READ: Nova Royalty announces addition of experienced mining engineer Andrew Greville as independent director from January 1, 2021
Nova CEO Alex Tsukernik told shareholders that the transaction is a vote of confidence in Nova’s strategy from its existing shareholders.
“Since Nova’s initial royalty acquisition, First Quantum has outlined the path to project development, which will make Taca Taca one of the very few copper development projects being advanced by a major mining company,” Tsukernik said in a statement. “We are excited to increase our ownership in this outstanding project and look forward to continuing to grow Nova into a premier copper-nickel royalty company.”
Under the transaction terms, Nova will issue just over 4.5 million shares worth an aggregate of US$13 million and pay a cash fee of US$3 million to First Quantum. Additionally, Nova will make additional cash payments totaling US$4 million once commercial production starts at Taca Taca.
The royalty is subject to a buyback right based on the proven reserves at Taca Taca in a feasibility study and will be equivalent to the amount of proven reserves multiplied by the prevailing market prices of all outlined commodities within the project.
Taca Taca, located in Argentina’s Salta province, is a porphyry copper-gold-molybdenum project located close to the Chilean border and about 90 kilometres east of Escondida, the largest copper mine in the world.
The project boasts a maiden reserve of 7.7 million tonnes of copper and an updated measured and indicated resource of 9.5 million tonnes with an initial mine life of 32 years.
First Quantum expects to make a production decision for Taca Taca in 2023 or 2024.
Contact Angela at [email protected]
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Story by ProactiveInvestors
Source: https://www.proactiveinvestors.com/companies/news/938086/nova-royalty-increases-royalty-interest-in-world-class-taca-taca-copper-gold-project-to-042-938086.html
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