Franco-Nevada has a 4.1% equity interest in Falconbridge Dominicana, C. por A. (“Falcondo”) that is economically similar to most of our profit royalties except that payments are received through discretionary dividend distributions. Xstrata Plc (“Xstrata”) is the operator with an 85.26% ownership. Falcondo is a ferronickel surface mining operation located in the Dominican Republic with operations dating since 1971. It has an integrated complex of four mines, smelter, crude oil supply system, oil refinery and 200 megawatt power plant with an annual production capacity of 29,000 tonnes of contained nickel. Historically, Falcondo’s reliance on oil has made it a high cost swing producer.

In March 2011, production resumed at 50% of capacity using procured electricity which has lowered costs. In January 2012, Xstrata reported that Falcondo had exceeded expectations by operating at an annual rate of almost 15,000 tonnes per annum. Xstrata is working on converting the Falcondo process plant from oil to natural gas to enable the operation to run at capacity and more competitively. Franco-Nevada expects a resumption in dividends is not expected until 2013 depending on nickel prices.

Asset highlights include:

• Fully established infrastructure
• Expected mine life of over 20 years with growth potential
• Potential revenues starting in 2013