Allied Gold Corporation (TSX: AAUC) (OTCQX: AAUCF) is pleased to announce that it has entered into final documentation for a streaming transaction with Wheaton Precious Metals International Ltd., a wholly-owned subsidiary of Wheaton Precious Metals Corp. Under the terms of the streaming agreement, Allied will receive an aggregate $175 million upfront cash payment to support the funding of its growth strategy underpinned by the development of its low-cost, fully permitted, and highly prolific Kurmuk project in Ethiopia.

The Stream Transaction with WPMI strongly endorses the quality and significant value of the Kurmuk project, and the ongoing execution and exploration efforts being carried out by the Company. This Stream Transaction further advances the Company’s financial strategy during its transformative growth phase at an attractive cost of capital, contributing to de-risking Kurmuk’s execution with a comprehensive financing package supporting the advancement of initiatives to unlock further upside potential and maximize shareholder value.

“We are delighted to partner with Wheaton on this streaming financing. This began as a multi-party process although it soon became apparent to us that Wheaton would be our partner of choice. They conducted detailed and extensive diligence, were supportive of our efforts, worked with us in evaluating and considering optimization opportunities and recognized the inherent value of our Kurmuk project, a value that we believe significantly exceeds the value implied in our share price. We take our sustainability programs seriously, and it was a delight to see Wheaton not only support these programs but provide suggested improvements. We also welcome Wheaton as a shareholder with a share position acquired in the Company’s recent overnight marketed equity financing.” commented Peter Marrone, Chairman and CEO. “The stream financing now allows us to complete the gold prepay which is the final component of our planned comprehensive financing package for the development of the Kurmuk project. The gold prepay is expected to be led by the lending syndicate for the Company’s revolving credit facility with proceeds available to Allied following the completion of the stream financing. We expect the Kurmuk mine will become one of the more significant precious metal mines in the world delivering significant production and cash flow following its construction.”

“Wheaton is pleased to announce a streaming agreement with Allied to advance the construction of the Kurmuk project, which is set to be the first commercial gold mine in Ethiopia,” said Randy Smallwood, President and CEO of Wheaton Precious Metals. “This fully permitted, high quality development project offers significant exploration potential, supported by a team at Allied with a proven operating track record. We are excited to partner with Allied to unlock opportunities that empower the local communities and help drive the growth of Ethiopia’s emerging metals and mining sector.”

Key Terms

• Upfront Consideration: WPMI will pay Allied total upfront cash consideration of $175 million in four equal installment payments during construction, subject to certain customary conditions.
• Stream Parameters:

• • WPMI will have the right to purchase 6.7% of payable gold from the Company’s Kurmuk mine (the “Stream”).
  • The gold stream rate will step down to 4.8% of payable gold after the delivery of 220,000 ounces of gold.
  • WPMI will make ongoing payments of 15% of the spot gold price for each ounce delivered under the Stream.
  • The Stream will cover the existing Kurmuk mining license and until 255,000 ounces of gold have been delivered to WPMI, any mineral interests located within a 50 km radius of the mining license which are processed at the Kurmuk plant.

• Buyback Option:

• • In the event of a change of control of Allied prior to the earlier of January 1, 2027 and achievement of completion, Allied has the option to buyback one third of the Kurmuk Stream.

• Other Considerations:
  • WPMI has been granted a right of first refusal on any future precious metal streams, royalties, prepays or similar transactions on the Kurmuk project.
  • Allied is expected to comply in all material respects with the International Finance Corporation’s Performance Standards on Environmental and Social Sustainability, the Voluntary Principles on Security and Human Rights, the Global Industry Standard on Tailings Management, and WPMI’s Partner/Supplier Code of Conduct, which outlines WPMI’s expectations with regard to environmental, social and governance (“ESG”) matters.
  • Wheaton participated in Allied’s equity financing completed on October 18, 2024 in the amount of C$20.15 million, with gross proceeds totalling C$221 million.

Transaction Rationale

• Crystallizes Significant Inherent Value in Kurmuk – The Stream Transaction recognizes the inherent value of the Company’s Kurmuk project and implies a valuation multiple significantly higher than that at which the Company’s shares currently trade in the market and the price at which the Company went public.

• Attractive Cost of Capital – The Company evaluated different financing options as part of an exhaustive process, concluding that this Stream Transaction provides much better cost of capital than any other alternative. The Stream agreement offers a competitive cost of capital based on Kurmuk’s Proven & Probable Mineral Reserves and remains favorable when assuming Mineral Resources conversion and exploration upside within the mining license.

• Financial Strategy – The Stream Transaction marks another significant milestone in completing the planned comprehensive financial package for the Kurmuk project. This strategy contemplates cash on hand, cash flow from operations, the Advance Amount and a gold prepay, which is the final component of our planned comprehensive financing package for the construction of the mine. The gold prepay is expected to be led by the lending syndicate for the Company’s revolving credit facility with proceeds available to Allied following the completion of the Stream Transaction.

• Exploration Upside Retained – Allied’s strategic objective for Kurmuk is to achieve a multi-decade mine life at production levels equal or above the average life of mine of 240,000 ounces of gold per year, leveraging on the project’s highly prospective land package. As result of the Stream Transaction, Allied retains full exposure to the significant exploration upside beyond the mining license, include the Tsenge, Agu and Dull Mountain targets among others. The Company is advancing a $7.5 million exploration program at Kurmuk focused on near mine extensions and regional targets where Allied sees the best potential to increase mineral inventories.

• Flexibility in Stream Deliveries – Allied can accelerate the step-down stream rate by supplementing planned deliveries with ounces produced from outside the Large-Scale Mining License.

Closing of the Stream Transaction and funding of the Advance Amount is subject to certain conditions precedent, including receipt of certain third-party consents and agreements, and completion of related security documents which are expected to be completed in short order.

Background on the Kurmuk Project

The Kurmuk project is located in western Ethiopia within the metal prolific Arabian-Nubian Shield, and approximately 500 kilometers from the capital Addis Ababa. Allied is targeting an initial production of approximately 270,000 gold ounces in the first 5 years and an average life of mine production of 240,000 gold ounces per annum, at an industry leading All-In Sustaining Costs⁽¹⁾ (“AISC”) below $1,000 per ounce. With initial Proven and Probable Mineral Reserves of 2.7 million ounces, the Company is targeting a mine life greater than 15 years driven by an extensive exploration program.

The Kurmuk project is fully permitted and currently in construction with first gold planned by the second quarter of 2026. Earthworks, camp construction along with engineering and procurement are progressing well with the project remaining on track and on budget. The Kurmuk project has been designed for a milling capacity of 6 Mtpa to leverage the large and prospective land package. Mining is planned as conventional shovel-truck open pit operations at Dish Mountain and Ashashire. Processing is designed as conventional CIL circuit and recoveries are expected to average 92% approximately over the life of mine. Power is planned to be supplied by the Ethiopian grid, and the Company has secured a power purchase agreement for 10 years with an average cost of 4 cents per kWh, aligned with the objective to delivery significant production at industry leading costs.

Allied is advancing an aggressive exploration program at Kurmuk, with a 2024 exploration budget of $7.5 million. Notably, the current exploration efforts are focused on extensions of the known Mineral Resources around the planned open pits as well as exploring near-mine regional targets like the newly discovered Tsenge area.

About Allied Gold Corporation

Allied is a Canadian-based gold producer with a significant growth profile and mineral endowment which operates a portfolio of three producing assets and development projects located in Côte d’Ivoire, Mali, and Ethiopia. Led by a team of mining executives with operational and development experience and proven success in creating value, Allied is progressing through exploration, construction and operational enhancements to become a mid-tier next generation gold producer in Africa and ultimately a leading senior global gold producer.

NOTES ON MINERAL RESERVES AND MINERAL RESOURCES

Mineral Resources are stated effective as at December 31, 2023, reported at a 0.5 g/t cut-off grade, constrained within an $1,800/ounce pit shell and estimated in accordance with the 2014 Canadian Institute of Mining, Metallurgy and Petroleum Definition Standards for Mineral Resources and Mineral Reserves (“CIM Standards”) and NI 43-101. Where Mineral Resources are stated alongside Mineral Reserves, those Mineral Resources are inclusive of, and not in addition to, the stated Mineral Reserves. Mineral Resources that are not Mineral Reserves do not have demonstrated economic viability.

Mineral Reserves are stated effective as at December 31, 2023 and estimated in accordance with CIM Standards and NI 43-101. The Mineral Reserves:

• are inclusive of the Mineral Resources which were converted in line with the material classifications based on the level of confidence within the Mineral Resource estimate;
• reflect that portion of the Mineral Resources which can be economically extracted by open pit methods;
• consider the modifying factors and other parameters, including but not limited to the mining, metallurgical, social, environmental, statutory and financial aspects of the project;
• include an allowance for mining dilution and ore loss; and
• were reported using cut-off grades that vary by ore type due to variations in recoveries and operating costs. The cut-off grades and pit shells were based on a $1,500/ounce gold price, except for the Agbalé pit, which was based on a $1,800/ounce gold price.

Mineral Reserve and Mineral Resource estimates are shown on a 100% basis. Designated government entities and national minority shareholders hold the following interests in each of the mines: 20% of Sadiola, 10.11% of Bonikro and 15% of Agbaou. Only a portion of the government interests are carried. The Government of Ethiopia is entitled to a 7% equity participation in Kurmuk once the mine enters into commercial production.

The Mineral Resource and Mineral Reserve estimates for each of the Company’s mineral properties have been approved by the qualified persons (within the meaning of NI 43-101) as set forth below:

Mineral Reserves (Proven and Probable)

The following table sets forth the Mineral Reserve estimates for the Company’s mineral properties as at December 31, 2023.

Notes:

• Mineral Reserves are stated effective as at December 31, 2023 and estimated in accordance with CIM Standards and NI 43-101.
• Shown on a 100% basis.
• Reflects that portion of the Mineral Resource which can be economically extracted by open pit methods.
• Considers the modifying factors and other parameters, including but not limited to the mining, metallurgical, social, environmental, statutory and financial aspects of the project.

Sadiola Mine:

• Includes an allowance for mining dilution at 8% and ore loss at 3%
• A base gold price of $1500/oz was used for the pit optimization, with the selected pit shells using values of $1320/oz (revenue factor 0.88) for Sadiola Main and $1500/oz (revenue factor 1.00) for FE3, FE4, Diba, Tambali and Sekekoto.
• The cut-off grades used for Mineral Reserves reporting were informed by a $1500/oz gold price and vary from 0.31 g/t to 0.73 g/t for different ore types due to differences in recoveries, costs for ore processing and ore haulage.

Kurmuk Project:

• Includes an allowance for mining dilution at 18% and ore loss at 2%
• A base gold price of $1500/oz was used for the pit optimization, with the selected pit shells using values of $1320/oz (revenue factor 0.88) for Ashashire and $1440/oz (revenue factor 0.96) for Dish Mountain.
• The cut-off grades used for Mineral Reserves reporting were informed by a US$1500/oz gold price and vary from 0.30 g/t to 0.45 g/t for different ore types due to differences in recoveries, costs for ore processing and ore haulage.

Bonikro Mine:

• Includes an allowance for mining dilution at 8% and ore loss at 5%
• A base gold price of $1500/oz was used for the Mineral Reserves for the Bonikro pit:
  • With the selected pit shell using a value of $1388/oz (revenue factor 0.925).
  • Cut-off grades vary from 0.68 to 0.74 g/t Au for different ore types due to differences in recoveries, costs for ore processing and ore haulage.
• A base gold price of $1800/oz was used for the Mineral Reserves for the Agbalé pit:
  • With the selected pit shell using a value of $1800/oz (revenue factor 1.00).
  • Cut-off grades vary from 0.58 to 1.00 g/t Au for different ore types to the Agbaou processing plant due to differences in recoveries, costs for ore processing and ore haulage

Agbaou Mine:

• Includes an allowance for mining dilution at 26% and ore loss at 1%
• A base gold price of $1500/oz was used for the Mineral Reserves for the:
  • Pit designs (revenue factor 1.00) apart from North Gate (Stage 41) and South Sat (Stage 215) pit designs which used a higher short term gold price of $1800/oz and account for 49 koz or 10% of the Mineral Reserves.
  • Cut-off grades which range from 0.49 to 0.74 g/t for different ore types due to differences in recoveries, costs for ore processing and ore haulage.

Mineral Resources (Measured, Indicated, Inferred)

The following table set forth the Measured and Indicated Mineral Resource estimates (inclusive of Mineral Reserves) and for the Company’s mineral properties at December 31, 2023.

The following table set forth the Inferred Mineral Resource estimates and for the Company’s mineral properties as at December 31, 2023.

Notes:

• Mineral Resources are estimated in accordance with CIM Standards and NI 43-101.
• Shown on a 100% basis.
• Are inclusive of Mineral Reserves. Mineral Resources that are not Mineral Reserves do not have demonstrated economic viability.
• Are listed at 0.5 g/t Au cut-off grade, constrained within an US$1800/oz pit shell and depleted to 31 December 2023.
• Rounding of numbers may lead to discrepancies when summing columns.