VANCOUVER (miningweekly.com) – Royalty vehicle Maverix Metals will acquire an existing 2% net smelter return (NSR) royalty from a third-party seller, on Endeavour Mining’s 90% interest in the Karma gold mine, in Burkina Faso, for $20-million in cash.
The mine and surrounding tenements were acquired by Endeavour from True Gold in April 2016, just as the mine started production.
According to production guidance provided by Endeavour, Karma is expected to produce 100 000 oz to 110 000 oz of gold this year.
“Maverix is pleased to add another producing gold royalty on a long-life mine with substantial exploration upside. Endeavour is a proven operator and we look forward to continued success at Karma. The acquisition complements our existing portfolio, will meaningfully increase our cash flow and will further enhance our strong growth profile in 2018 and beyond,” Maverix president and CEO Dan O’Flaherty said in a statement.
The company currently has 25 gold streams and royalties, of which nine of the underlying mines are producing.
While the company did not identify the third-party vendor, True Gold had in 2013 sold a 2% NSR on its interest in the Karma project to Boston-based privately firm Liberty Metals & Mining.
Closing of the transaction is subject to customary closing conditions and Maverix, the vendor and the Endeavour entering into an assignment agreement before year end.