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Sandstorm Gold saw a bit of a bump in share price Tuesday morning following its announcement regarding ten new royalty agreements. The company has secured royalties on ten projects – two in Africa and eight in return for the sale of a number of its properties in Nevada.
That brings the total number of streams and royalties owned by Sandstorm to 56, and the company has around US$165 million in available capital to deploy into future transactions. On the back of that news, Sandstorm was up about 13 cents, trading at $5.14 during Tuesday trading hours. The company is up roughly 38 percent this month.
“The additional royalties provide Sandstorm with long-term exposure to a number of high quality assets with a relatively small capital outlay,” commented Sandstorm president and CEO Nolan Watson in Tuesday’s release.
Sandstorm has sold eight of its Nevada properties to Tarsis Resources (TSXV:TCC) in return for 1.5 million shares of Tarsis and net smelter royalties (NSRs) of two to three percent on each of the properties. Sandstorm also has right of first refusal on any future metal streaming agreements.
A number of the Nevada properties are prospective for Carlin style gold, while others are prospective for other types of mineralization including mesothermal gold and High-sulphidation epithermal gold. Properties included in the transaction include:
- Bellview – White Pine County
- East Walker – Lyon County
- Hot Pot – Lander County
- Horsethief – Lincoln County
- Fri Gold – Nye County
- Kobeh – Eureka County
- Ashby – Mineral County
- Columbia – Humboldt County
“Little to no exploration has taken place for several years due to various corporate transactions involving these 8 projects. Our agreement with Sandstorm will focus on unlocking the value of these assets – Tarsis is focused on early-stage exploration,” said Tarsis president and CEO, Mark Blythe. “Our geological team is very keen to begin work on these properties.”
Additionally, Sandstorm secured a royalty agreement for Orezone gold’s (TSX:ORE) Bombore project in Burkina Faso, whereby it will provide the company with up to US$8 million in financing to advance the project, and made an upfront payment of C$1.5 million to Castle Peak Mining (TSXV:CAP) for a 1 percent NSR on its Akorade project in Ghana. Both companies also gained on the news – Orezone rose just under 10 percent to $0.46 and Castle Peak was up 50 percent to $0.015 at the time of writing.
Sandstorm has right of first refusal for any future streams or royalty agreements for Akorade, and for Bombore until 36 months following the achievement of commercial production at the project.
Certainly, there’s been increased activity in the gold space as of late following the recent rise in the gold price, and it will no doubt be encouraging for gold investors to see projects like Bombore and Akorade getting additional funding to help them move ahead.
Securities Disclosure: I, Teresa Matich, hold no investment interest in any of the companies mentioned.
Editorial Disclosure: Tarsis Resources is a client of the Investing News Network. This article is not paid-for content.
Related reading:
Sandstorm Gold’s Nolan Watson on the Future of Streaming and Royalty Companies