Franco-Nevada holds royalties covering portions of the Goldstrike complex operated by Barrick Gold Corporation (“Barrick”). The Goldstrike complex is comprised of the Betze-Post open pit mine (the “Goldstrike Open Pit Mine”) and the underground mine covering the Meikle and Rodeo ore bodies (the “Goldstrike Underground Mine”). The royalties within the Goldstrike complex are made up of the following multiple claim groups:

• 4% NSR and 5% NPI that cover the Post and Goldstrike claims, which cover the central and southern portions of the Goldstrike Open Pit Mine. These royalties apply to a total of 30 claims (466 acres). NSR payments have been made from the start of production on these claims, and NPI royalty payments from the fourth quarter of 1993. 
• 4% NSR and 5% NPI over 805 acres covering the Extension and Gold Bug claims, which cover most of the Goldstrike Underground Mine. The Goldstrike Underground Mine is located just north of the Goldstrike Open Pit Mine, along the same mineralized trend as the surface deposits. The Goldstrike Underground Mine includes the Meikle deposit, a high-grade ore body that was discovered in 1989 and began production in 1996, and the Rodeo deposit, a second ore body that began production in 2002.
• 2% NSR over the Bazza claims and a 2% NSR and 2.4% NPI over the Bazza Strip area, which cover a western portion of the Goldstrike Open Pit Mine.
• 6% NPI over the SJ claims and SPLC lease area, which cover the north-western and south-western portions of the Goldstrike Open Pit Mine.
• 2% - 4% NSR on the peripheral Corbett, Pandora, Royal, Weimer claim groups and Rodeo Creek fee lands.

The royalties within the Goldstrike complex have over time been, or could in the future be, impacted by (i) Barrick’s planned mining sequence of the Goldstrike complex, which focuses production on differing royalty claims, resulting in differing royalty burdens, as well as away from lands over which the Company holds a royalty interest, (ii) production rates from the Goldstrike complex due to head grades, (iii) variable recovery rates depending on ore type and processing methods, (iv) the timing of waste removal and processing from stockpiles, and (v) displacement of Goldstrike ores by ores from other Barrick intercompany properties.

Franco-Nevada does not have the obligation to fund any portion of the costs associated with the operations at the Goldstrike complex. The NSR royalties are based upon gross production from the royalty claims, reduced only by the ancillary costs of smelter and refining charges and transportation. The determinants of the revenue received under the NSR agreements are the number of ounces of gold produced, the selling price of the gold, and the cost of shipping, smelting and refining. In contrast, NPI royalties are calculated as proceeds less costs, where proceeds equal the number of ounces of gold produced from the royalty burdened claims multiplied by the spot price of gold on the date gold is credited to Barrick’s account at the refinery and costs include operating and capital costs.

Barrick reported that the Goldstrike complex produced 1.24 million ounces in 2010 at cash costs of $530/oz (cash costs being cost of sales divided by ounces). Barrick reported that production for the year was down by 13% compared to 2009, primarily as a result of the planned partial shutdown of the autoclave facility which occurred during the second half of 2009 due to a decrease in ore suitable for acidic autoclaving, as well as mine sequencing that resulted in lower grade areas being mined in the first half of 2010. Barrick has identified the use of thiosulphate technology at Goldstrike to extend the life of the autoclaves. For 2011, Barrick expects production at Goldstrike to be between 1.000 and 1.075 million ounces at total cash costs of $515 to $535. The lower 2011 production at Goldstrike is due to a significant waste stripping campaign and the processing of lower grade stockpile ore.