ZACKSยท2025-05-22 16:41Core Viewpoint - Royal Gold, Inc. has entered into a $200 million deal with Solaris Resources for the Warintza Project, which is expected to provide significant long-term production potential in Ecuador [1][4]. Group 1: Strategic Acquisition Details - The Warintza Project is a copper-molybdenum-gold porphyry development project with Measured and Indicated Resources of 1.082 billion tons at a copper equivalent grade of 0.48%, and Inferred Resources of 3.135 billion tons [2]. - Early works for the project are targeted to begin in the second half of 2026, with production anticipated by 2030 [3]. Group 2: Financial Structure of the Deal - The $200 million payment will be made in three installments: $100 million at financial closing, $50 million after Environmental Impact Assessment approval and Prefeasibility Study publication, and the final $50 million one year after closing [4]. - Royal Gold will receive 20 ounces of gold per million pounds of recovered copper, initially paying 20% of spot gold prices until 90,000 ounces are delivered, increasing to 60% thereafter [5]. Group 3: Royalty Structure - Royal Gold will earn a 0.30% NSR royalty, which will increase annually until it caps at 0.60% or upon stream commencement [6]. - In the event of a change of control, these rates will vest for the life of the mine, with additional royalties applicable if Solaris sells assets within the project area [6]. Group 4: Stock Performance - Over the past year, Royal Gold's shares have increased by 41.4%, slightly below the industry's growth of 42.3% [7].