Mr. Sean Roosen reports
OSISKO CLOSES FINANCING ON VICTORIA GOLD'S EAGLE GOLD PROJECT
Osisko Gold Royalties Ltd. has completed the previously announced $148-million financing transaction with Victoria Gold Corp., pursuant to which Osisko acquired from Victoria a 5-per-cent net-smelter-return royalty for $98-million on the Dublin Gulch property which hosts the Eagle gold project located in Yukon, Canada, and purchased from Victoria, on a private placement basis, 100 million common shares of Victoria at a price of 50 cents per common share.
Sean Roosen, chair and chief executive officer of Osisko, commented on the transaction: "The addition of the Eagle royalty strengthens our Canadian asset base and adds near-term Canadian gold to Osisko's growth profile from a fully permitted, fully financed and shovel-ready project located in Yukon, a premier mining jurisdiction. We are very pleased to partner with Victoria to develop Canada's next premier gold mine and to generate important benefits for all project stakeholders."
The royalty purchase
As part of the transaction, Osisko has purchased a 5-per-cent NSR royalty on all metals and minerals produced from the property, which includes the Eagle and Olive deposits, until an aggregate of 97,500 ounces of refined gold have been delivered to Osisko, and a 3-per-cent NSR royalty thereafter. The purchase price for the royalty is an aggregate of $98-million, of which a first tranche of $49-million was advanced as of the date hereof, and the second tranche of $49-million will be financed pro rata to drawdowns under the subordinated debt component of the Orion debt facilities.
The private placement
As part of the private placement, Osisko has purchased 100 million common shares of Victoria at a price of 50 cents per common share.
Immediately prior to the closing of the private placement, Osisko had beneficial ownership of, or control and direction over, 20,427,087 common shares of Victoria, representing approximately 4.0 per cent of Victoria's issued and outstanding common shares. Immediately following the closing of the private placement, Osisko owns beneficial ownership of, or control and direction over, 120,427,087 common shares, representing approximately 15.7 per cent of Victoria's issued and outstanding common shares. All securities issued to Osisko under the private placement are subject to a four-month hold period from the date hereof, pursuant to applicable securities legislation. Additionally, in connection with the financing, Osisko has obtained the right to nominate one of the members of Victoria's board of directors.
Osisko acquired the common shares described in this press release for investment purposes and in accordance with applicable securities laws, Osisko may, from time to time and at any time, acquire additional shares and/or other equity, debt or other securities or instruments of Victoria Gold in the open market or otherwise, and reserves the right to dispose of any or all of its securities in the open market or otherwise at any time and from time to time, and to engage in similar transactions with respect to the securities, the whole depending on market conditions, the business and prospects of Victoria, and other relevant factors.
This news release is issued under the early warning provisions of the Canadian securities legislation. A copy of the early warning report to be filed by Osisko in connection with the private placement described above will be available on SEDAR under Victoria's profile. To obtain a copy of the early warning report, you may also contact Vincent Metcalfe, vice-president, investor relations, of Osisko at 514-940-0670. Victoria's head office is located at 80 Richmond St. West, Suite 303, Toronto, Ont., M5H 2A4.
In connection with the financing, Victoria has also entered into, as of the date hereof, definitive and binding agreements with an affiliate of Orion Mine Finance, pursuant to which Orion has agreed to provide debt facilities to Victoria, and has purchased from Victoria, on a private placement basis, 150 million common shares of Victoria at a price of 50 cents per common share. Victoria has also entered into definitive agreements with Caterpillar Financial Services Ltd. with respect to a $50-million (U.S.) equipment financing facility. All of such agreements were entered into with respect to a construction financing package totalling approximately $505-million in aggregate (including the financing) that is expected to fully finance the development of the project through to commercial production.
The Dublin Gulch property and the Eagle gold project
Victoria Gold's 100-per-cent-owned Dublin Gulch gold property is situated in the central Yukon Territory, Canada, approximately 375 kilometres north of the capital city of Whitehorse, and approximately 85 kilometres from the village of Mayo. The property is accessible by road year-round and is located within Yukon Energy's electrical grid.
The property covers an area of approximately 555 square kilometres and is the site of Victoria's Eagle gold deposit. The Eagle gold mine is expected to be Yukon's next operating gold mine and, between the Eagle and Olive deposits, includes proven and probable reserves of 2.7 million ounces of gold from 123 million tonnes of ore with a grade of 0.67 gram of gold per tonne, as outlined in a National Instrument 43-101 feasibility study. The NI 43-101 mineral resource for the Eagle and Olive deposits has been estimated to host 191 million tonnes averaging 0.65 gram of gold per tonne, containing 4.0 million ounces of gold in the measured and indicated category, inclusive of proven and probable reserves, and a further 24 million tonnes averaging 0.61 gram of gold per tonne containing 500,000 ounces of gold in theinferred category.
About Osisko Gold Royalties Ltd.
Osisko Gold Royalties is an intermediate precious metal royalty company focused on the Americas that commenced activities in June, 2014. Osisko holds a North American-focused portfolio of over 130 royalties, streams and precious metal offtakes.
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