Assets Overview
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Franco-Nevada is a gold focused royalty company with additional interests in platinum group metals, oil & gas and other assets. The majority of revenues are generated from a diversified portfolio of properties in the United States, Canada and Australia. The portfolio includes over 300 royalties covering properties in operation, advanced properties at the permitting, feasibility or advanced exploration stages, early stage exploration interests and other assets.
The Corporation's Royalty Portfolio includes both mineral and oil & gas interests which are mostly royalty interests but also include some working and equity interests, undeveloped properties, options to acquire royalties and other assets. The Mineral Royalties are further characterized by commodity as being in the gold, platinum or base metals categories and these in turn are further subdivided by their project status as being either operating, advanced or early stage exploration projects. A majority of the Mineral Royalties are characterized as being in the gold category and the majority of revenues from the Mineral Royalties are from gold operations.
The Oil & Gas Interests are located primarily in the Western Canadian sedimentary basin with a larger amount of revenue generated from conventional oil than natural gas properties in 2008. The Oil & Gas Interests include working interests ranging from 3.7% to 14.85% in the Drake Point, Hecla, King Christian and Roche Point natural gas fields located on and offshore Melville Island in the Canadian Arctic. In addition, the Oil & Gas Interests include mineral rights to approximately 100,000 gross acres of unproved land in Canada primarily related to oil and natural gas rights.
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Asset Tabulation at June 30, 2009 |
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|
|
Gold |
Platinum |
Base Metals |
Oil & Gas |
TOTAL |
|
Operating |
16 |
1 |
6 |
113 |
136 |
|
Advanced |
14 |
1 |
3 |
1 |
19 |
|
Exploration |
131 |
2 |
19 |
181 |
333 |
|
TOTAL |
161 |
4 |
28 |
295 |
488 |
The above tabulations set forth certain information concerning the Corporation's assets. The Royalty Portfolio has been grouped by commodity as "Gold", "Platinum", "Base Metals" and "Oil & Gas". For presentation purposes, "Gold" encompasses some silver assets and polymetallic exploration prospects. "Platinum" encompasses the platinum group metals, including palladium. "Base Metals" includes some iron ore, coal and other mineral assets. "Operating" assets are presented first and are generally assets that are presently operating or have recently generated revenue to the Corporation. "Advanced" assets are assets that have a reasonable possibility of generating revenue to the Corporation in the next five years and include assets under development, permitting, feasibility or advanced exploration. "Exploration" assets are early stage exploration properties that are more speculative and are expected to require more than five years to generate revenue, if ever, or are currently not active.
The number of royalty assets has been counted in different manners depending on the category. Royalties on an operating property are generally counted as a single royalty even if the Corporation has multiple different royalties on the property, such as at Goldstrike. However, royalties on operating properties that have significant co-products with separate royalty terms for each commodity have been counted twice, such as the Robinson royalties for gold and copper. Advanced assets are generally counted as a single royalty by property or camp even through the Corporation may have different royalties over separate properties in the district. Exploration royalties have simply been counted by the number of royalty contracts and no effort has been made to consolidate royalties in the same district. The Corporation's wholly owned undeveloped oil & gas land positions and its working interests in Arctic gas resources are additional assets of the Corporation. However these undeveloped oil & gas land positions and working interests are not counted as royalties for the Corporation's overall disclosure of the number of royalties held. As of March 26, 2009 the Corporation estimates that it holds 193 Mineral Royalties and 113 operating Oil & Gas Interests for a total of 306 royalties and another 182 undeveloped Oil & Gas Interests.
The description of our assets should be read with reference to the additional supporting detail and cautions regarding the use of forward-looking information outlined in our Annual Information Form ("AIF") available on http://www.sedar.com/ and our web site http://www.franco-nevada.com/. Forward-looking information is subject to change and risk, should not be relied on and should be considered along with the particular assumptions and risks underlying these statements as set out in detail in our AIF. As a royalty holder, we may have limited, if any, access to technical information on properties on which we hold interests. In other circumstances, we have information that is subject to confidentially provisions with the operators. For our public disclosure, we have relied principally on publicly available information disclosed by the owners and operators of our royalty properties as of March 26, 2009. Franco-Nevada's royalties often cover less than 100% and sometimes only a portion of the publicly reported reserves, resources and production of the property. We acquired the majority of our assets on December 20, 2007 and can only report audited royalty revenues for the final 11 days of 2007 which is not realistically comparable with the reported full year numbers for 2008. Schematic representations of the properties are meant to be indicative of Franco-Nevada's understanding of what can be publicly disclosed of the positioning of its royalty properties relative to current operations and should not be treated as fully scaled or complete representations. <!-- InstanceEndEditable -->