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Franco-Nevada

Goldstrike (Au)

Goldstrike

LOCATION: Nevada, United States
OPERATOR: Nevada gold Mines llc
ROYALTY: NSR: 2-4% / NPI: 2.4-6%

Franco-Nevada holds royalties covering the majority of the Nevada Gold Mines LLC (“Nevada Gold Mines”) Goldstrike complex operated by Barrick Gold Corporation (“Barrick”). The Goldstrike complex is located on the Carlin Trend, about 60 km northwest of the town of Elko, Nevada and includes the open-pit Betze-Post mine, as well as the underground operations of Meikle and Rodeo immediately to the north. Mining activity commenced on the property in 1976 and, since 1987, has been operated by Barrick. Franco-Nevada holds both NSR (2-4%) and NPI (2.4-6%) royalties at Goldstrike covering over 50% of the reported Mineral Reserves. These estimates include low-grade ore that has been stockpiled. The royalties vary depending on the claim blocks, operating costs and capital investments, as shown in the schematic. As a result, royalty payments can vary substantially on a quarterly basis. Franco-Nevada anticipates production in 2020 to be similar to that of 2019.

On July 1, 2019, Barrick (61.5%) and Newmont Corporation (“Newmont”) (38.5%) combined their significant assets across Nevada to create Nevada Gold Mines as a joint venture. Under this joint venture, Goldstrike is now reported as part of the Carlin operation category by Barrick. In February 2020, Barrick announced year-end 2019 production of 968,000 gold ounces from its 61.5% share of Carlin which includes Goldstrike, Gold Quarry and Nevada Gold Mines’ 60% equity share of South Arturo as well as other properties where Franco-Nevada has no royalties or stream interests. Barrick reported in its year-end 2019 results that Mineral Reserves at the Goldstrike underground had increased by 1.52 million ounces, benefiting from mine redesigns and revised cut-off grades at Rodeo and North Post.

ASSET HIGHLIGHTS

  • World class gold operation
  • Profit royalties provide more leverage to gold prices
  • NSR royalties provide the highest margins and most downside protection to changes in gold prices

2019 2018 2017
Total Revenue to FNV ($ million) $ 21.2 $ 19.0 $ 16.8

Goldstrike map