Operator: Teranga Gold Corporation
Stream: Fixed gold deliveries / 6% gold stream
In December 2013, Franco-Nevada provided Teranga Gold Corporation (“Teranga”) with $135 million to fund the acquisition by Teranga of the remaining interests of the Oromin Joint Venture (“OJVG”). The OJVG owned the adjacent property which hosts several deposits representing future ore sources for Teranga’s neighbouring Sabodala mill. With the acquisition, Teranga now controls a sizable land package of 1,055 km2 which includes much of a 70 km strike length along a prospective greenstone belt.
Under the terms of the agreement between Franco-Nevada and Teranga, Teranga will deliver 22,500 ounces of gold annually over the first six years of the agreement. Following delivery of 135,000 ounces of gold, Franco-Nevada will receive 6% of gold production that is sourced from either the Sabodala or OJVG properties. Franco-Nevada will make ongoing payments for each ounce of gold delivered equal to 20% of the spot gold price. As of the end of 2016, Teranga has delivered 67,500 ounces (Franco-Nevada has sold 65,625 ounces).
Sabodala produced a record 216,735 ounces in 2016 versus 182,282 ounces in 2015. 2016 production exceeded guidance of 200,000-215,000 ounces. For 2017, Teranga expects to produce between 205,000-225,000 ounces from Sabodala. Teranga estimates a mine life for Sabodala of over 13 years based on existing Mineral Resources.
|Total Revenue to FNV ($ million)