True Gold Secures US$120 Million Financing from Franco-Nevada and Sandstorm for Karma Project Construction

True Gold Mining Inc. (TSXV; TGM) has entered into a US$100-million stream agreement with Franco-Nevada Corporation (TSX:FNV, NYSE: FNV) and Sandstorm Gold Inc.(TSX:SSL; NYSEMKT:SAND). The company noted that based on its current Feasibility Study, the agreement is anticipated to provide sufficient funding to complete the construction of the Karma Project in Burkina Faso, West Africa.

According to the company’s press release:

he US$100M Agreement requires True Gold to purchase and deliver 100,000 ounces of gold over five years, and thereafter 6.5% of equivalent production at Karma. In addition, True Gold holds the sole option to increase funding by up to US$20-million (“Increase Option”) during the next 18 months. If the Increase Option is exercised in full, True Gold would deliver an additional 30,000 ounces of gold on a fixed payment schedule.

Highlights from the company’s press release include:

• US$120-million financing commits funds to construct Karma without need for additional equity

• Funding provides True Gold with the flexibility to deliver base case outlined in the Karma Project Feasibility Study¹ and scale up quickly, with the goal of becoming a high-margin, mid-tier gold producer

• Significant construction to begin next month, with first gold pour anticipated by the end of 2015

• Agreement is a strong endorsement of Karma and the project’s long-term growth potential from two leading royalty and streaming companies

• Funding package provides capital at more favourable terms than traditional project financing

• True Gold now ranks among a select group of emerging producers worldwide with a permitted, fully funded project

Mark O’Dea, Executive Chairman of True Gold commented:

It is a pleasure to welcome Franco-Nevada and Sandstorm and their high-calibre management teams as our newest partners on the Karma Project. Their participation provides a strong endorsement of the project and the quality of our team. We feel this is a highly attractive funding package that is well aligned with our development plans and we look forward to working together.”

“I would also like to thank our cornerstone investors, Liberty Metals and Mining and Teck Resources, for their leadership roles in supporting the advancement of Karma over the past year. Since May 2013, during one of the toughest financing environments in recent history, True Gold has arranged approximately $200 million in funding,