TSX:FNV 101.61 +0.49 +0.48%
Volume 421,412
February 19, 2019
NYSE:FNV 76.94 +0.52 +0.68%
Volume 841,314
February 19, 2019
Gold 1,345.35 +3.05 +0.23%
Volume
February 20, 2019
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SouthArturo-Panoramic

LOCATION: NEVADA
ROYALTY: GR: 4-9% with AMR
OPERATOR: BARRICK GOLD/PREMIER GOLD MINES LIMITED

The South Arturo project consists of a series of sediment hosted Carlin-style gold deposits adjacent to and including the former Dee gold mine, 60 km northwest of Elko, Nevada. The project is operated by a joint venture between Barrick (60%) and Premier Gold Mines Limited (“Premier”) (40%). Premier purchased its interest in the property in 2015 from Goldcorp. Franco-Nevada holds a sliding scale gross royalty (4-9%) on production from the Dee claims. The royalty agreement includes an annual minimum which is credited against any future production royalty payments.

The South Arturo mine achieved commercial production in August 2016. The operation is located in close proximity to Barrick’s Goldstrike where the ore is processed at the refractory facilities. The mine produced 142,810 ounces in 2017 (100% basis) which is down from the 223,145 ounces produced in 2016. The decrease in year-over-year production is attributable to the planned wind down of the Phase 2 pit. Production for 2018 is expected to decrease further to 12,500-25,000 ounces as the operation processes the remaining stockpiled ore from Phase 2.

The joint venture is now working towards the construction of an underground mine (El Nino) and the next phase of open pit mining (Phase 1). Stripping of the Phase 1 pit is expected to commence mid-year 2018 and development of the El Nino underground is scheduled to begin in the second half of 2018. An updated Mineral Reserve and Mineral Resource estimate for the project was released in February 2018. Mineral Reserves increased by 333% and an initial Mineral Resource was provided for the Phase 3 open pit.

ASSET HIGHLIGHTS:

  • Reduced production in 2018 as Phase 2 mining completed
  • Advancing Phase 1 pit and El Nino underground in 2018

2017 2016 2015
Revenue to Franco-Nevada ($ million) $ 10.7 $ 13.8 $ 0.2

SouthArturo