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EMPRESS ROYALTY EXECUTES GOLD STREAM ON GALAXY MINE

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EMPRESS ROYALTY EXECUTES GOLD STREAM ON GALAXY MINE

 

 

 

 

 

 

Empress Royalty Corp. (TSX-V:EMPR) (OTCQX:EMPYF) is pleased to announce the execution of an agreement for a US$5M gold stream on the Galaxy gold mine in South Africa owned by Golconda Gold Ltd. (TSX-V:GG) (OTCQX:GGOF).
“We are excited to provide a gold stream financing to Golconda’s Galaxy mine, which will support Golconda in expanding its production capacity,” stated Alexandra Woodyer Sherron, CEO and President of Empress Royalty.  “The gold stream on the Galaxy mine will immediately increase Empress’ revenue projections and expand our long-term revenue profile.  With four producing assets in our portfolio generating significant revenue, we look forward to executing similar transactions on producing precious metal mines that will result in substantial returns for our shareholders.”

In addition, Nicholas Brodie, CEO of Golconda stated “We are excited to partner with Empress who, through their due diligence, have understood the true potential of Galaxy. With the proceeds generated from the Investment, we will be able to further implement and execute on our expansion plans at the Galaxy mine.”

 

THE INVESTMENT

 

Empress has entered into a US$5M metal purchase and sale agreement  with Galaxy Gold Reefs (Pty) Ltd., a subsidiary of Golconda, and Golconda and certain of its affiliates, for payable gold production from the Galaxy mine in South Africa.  The Investment is based on 3.5% of the payable gold production from the Galaxy mine for an initial 8,000 payable ounces; thereafter, the percentage will reduce to 2.0% of the payable gold production until the earlier of: (i) 20,000 ounces having been paid to Empress; or (ii) 20 years after the first payment was made.  The purchase price for the payable gold delivered pursuant to the Agreement is 20% of the gold spot price.  The closing of the transaction and the funding of the Investment is subject to customary closing conditions including Empress’ satisfactory completion of technical, legal, and financial due diligence which is expected to be completed in early 2024.  It is anticipated that the Investment will be funded by Empress through a credit facility.

 

THE GALAXY GOLD MINE

 

Golconda acquired the Galaxy mine in November 2015.  Galaxy is situated 8 km west of the town of Barberton and 45 km west of the provincial capital of Nelspruit in the Mpumalanga Province of South Africa.  The property covers 58.6 km2 and is part of the prolific Barberton Greenstone Belt.
Galaxy consists of 22 ore bodies, all of which can be accessed via adits at level 17 and level 22. Galaxy is currently mining at the following two main ore bodies:

  • Galaxy Ore Body – a large pipe shaped ore body with a thickness of 35m and a strike of around 100m; and
  • Princeton Ore Body – a steeply dipping ore body with a thickness of 5m and a strike of 300m.

 

The current mine plan includes the mining of the Galaxy Ore Body and the Princeton Ore Body using a mechanised cut and fill mining method.  There are also extensive tailings around the Galaxy mine site which Golconda intends to use to supplement production.  Golconda has already upgraded the crushing circuit, float plant and filtration plant to 50,000 tonnes per month, from the original 15,000 tpm plant, which produces a gold concentrate.

Galaxy is currently in Phase 1 of its expansion program taking production to 15,000 tpm and 1,100 recovered gold ounces per month. The proceeds from the Agreement will be used to fund the expansion required in Phase 2 to take production to 48,000 tpm and 2,800 recovered gold ounces per month.

Golconda Gold has completed the Galaxy Technical Report and the PEA (as such terms are defined below) for the Galaxy mine, which supports the expansion plans already undertaken and the future plans for expansion.  In addition, Golconda has a drill ready plan to expand the resource to over 4 million ounces, which encompasses the other 20 identified ore bodies.  Work is already underway to determine how this can support future expansion of Galaxy. Further information can be found in the technical report titled “NI 43-101 Technical Report on the Galaxy Gold Mine, South Africa” filed on sedarplus.ca on July 6, 2020.

Empress has completed a site visit, and a third-party engineering firm has satisfactorily completed a technical analysis of the Galaxy mine.  The use of proceeds from the transactions contemplated by the Agreement, will enhance and expand the production profile at Galaxy moving forward.

Richard Mazur, P.Geo., a Qualified Person under National Instrument 43-101 has reviewed and approved the contents of this news release.

 

ABOUT GOLCONDA GOLD

 

Golconda Gold is an un-hedged gold producer and explorer with mining operations and exploration tenements in South Africa and New Mexico. Golconda Gold is a public company, and its shares are quoted on the TSX Venture Exchange and the OTCQB.  Golconda Gold’s management team is comprised of senior mining professionals with extensive experience in managing mining and processing operations and large-scale exploration programmes. It is committed to operating at world-class standards, focused on the safety of its employees, respecting the environment, and contributing to the communities in which it operates.  Golconda Gold’s primary objective is to be reshaped into a long-life and low-cost operation that can produce positive returns for investors across commodity cycles by optimising current mining, processing, and administrative operations to reduce costs and maximize profits; and grow through opportunistic acquisition and development opportunities.

 

ABOUT EMPRESS ROYALTY CORP.

 

Empress is a global royalty and streaming creation company providing investors with a diversified portfolio of gold and silver investments. Since listing in December 2020, Empress has built a portfolio of precious metal investments and is actively investing in mining companies with development and production stage projects who require additional non-dilutive capital. The Company has strategic partnerships with Endeavour Financial and Terra Capital which allow Empress to not only access global investment opportunities but also bring unique mining finance expertise, deal structuring and access to capital markets. Empress is looking forward to continuously creating value for its shareholders through the proven royalty and streaming models.

Posted November 23, 2023

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