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Royal Road Minerals announces formalization of deals for two mines in Nariño, Colombia

The group's Colombian subsidiary Exploraciones Northern Colombia SAS (ENC) has struck the deals and related earn-in and option agreements

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ENC will receive a quarterly royalty equivalent to 3% of the doré extracted from the concessions, said Royal Road

Royal Road Minerals Limited (CVE:RYR) (OTCMKTS:RRDMF) has struck more agreements on mining at promising gold operations in the Nariño district of Colombia - this time at the La Candelaria and San Miguel mines.

In a statement, the group said its Colombian subsidiary Exploraciones Northern Colombia SAS (ENC) has struck the deals and related earn-in and option agreements with the proprietors of the two mines.

READ: Royal Road Minerals inks deal to formalize mining operations at highly prospective La Esmerelda concession

ENC will receive a quarterly royalty equivalent to 3% of the doré extracted from the concessions and has been granted the sole right to carry out all exploration as well as the right to acquire 70% of the concessions, subject to certain exploration milestones. These include the completion of a minimum 3,000 meters of drilling, underground sampling, and completing an internal feasibility study.

The two sites lie within the concession held by major AngloGold Ashanti (AGA), which ENC obtained following a deal announced in March, 2019.

Royal Road also said ENC has executed a Heads of Agreement (HOA) with Colombian mining company Latminco S.A.S (LMC), which specializes in optimizing operations for the benefit of local miners and surrounding communities.

The HOA will see LMC and ENC collaborate and agree to identify opportunities where production may be optimized and processing may be centralized to the benefit of all parties, the company said.

Tim Coughlin, Royal Road's chief executive, noted that the group has now executed four formalization agreements over promising gold operations in Nariño and said that "there will be more to follow".

"The cash we anticipate earning from royalties due as part of this process will of course be significant, but we do not want to lose sight of the fact that we are an exploration company. The agreement we have executed with Latminco can allow us to effectively hand over the mine management component of the formalization process and ensure that our expert teams are focused on the job of finding large, Tier 1 gold and copper deposits, either as a component of the earn-in aspect of these agreements, or elsewhere in our extensive and prospective land package throughout Colombia," Coughlin added.

Contact the author at [email protected]

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TSX-V:RYR
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