TSX:FNV 82.53 -0.90 -1.08%
Volume 967,041
September 21, 2018
NYSE:FNV 63.95 -0.66 -1.02%
Volume 1,891,366
September 21, 2018
Gold 1,200.30 -8.03 -0.66%
Volume
September 21, 2018
Contact Share

Location: Chile
Operator: Teck Resources Limited
Royalty: NSR: 1.5%

Franco-Nevada has a 1.5% NSR royalty covering the Relincho property of the combined NuevaUnión project being advanced by 50/50 joint venture partners, Teck and Goldcorp. The NuevaUnión project combines Teck’s Relincho project with Goldcorp’s El Morro project, located approximately 40 km apart in the Atacama region of Chile. The 1.5% NSR is subject to a maximum price of $6.00/lb copper and threshold price of $1.50/lb copper, inflation adjusted. No royalty is paid if the average price for the quarter is less than the threshold price and royalty payments commence after four years of commercial production. Franco-Nevada acquired the royalty through its acquisition of Lumina Royalty Corp. in December 2011.

NuevaUnión is one of the largest undeveloped copper-gold-molybdenum projects in the Americas. Based on the results of a preliminary economic assessment, initial stage development of NuevaUnión contemplates a conveyor to transport ore from the El Morro site to a single line mill and concentrator facility at the Relincho site with an initial capacity in the range of 90,000-110,000 tonnes per day to produce an average of approximately 190,000 tonnes of copper and 315,000 ounces of gold per year over the first 10 years. The phased development approach contemplated in the PEA will allow for future expansions to be funded from project cash flows, thus significantly reducing the initial funding requirement. By combining the two projects, there will be significant reductions to infrastructure requirements and thus initial capital, including utilizing a single desalination plant, a single port, a single transmission line, a single concentrator and a common tailings facility. NuevaUnión expects to present a pre-feasibility study in Q1 2018, followed by an Environmental Impact Assessment submission in Q3 2018 leading to the completion of a feasibility study in Q1 2019. Based on these reports and a positive construction decision, first ore is possible by 2023.

ASSET HIGHLIGHTS:

  • Joint Venture established with Goldcorp to combine Relincho and El Morro into one development project
  • Project synergies estimated to significantly reduce initial capital
  • Pre-feasibility for combined project expected in first quarter of 2018

2017 2016 2015
Revenue to Franco-Nevada ($ million) $ - $ - $ -