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Triple Flag Enters into Agreements with Monarch to Acquire 2.75% NSR Royalty on Beaufor Mine Gold Project

Triple Flag Precious Metals Corp. (with its subsidiaries, "Triple Flag" or the "Company")  is pleased to announce that it has entered into agreements to acquire a 2.75% net smelter returns royalty on Monarch Mining Corporation's ("Monarch") Beaufor Mine gold project in Quebec, Canada for total cash consideration of C$11.25 million. Monarch expects production at Beaufor to recommence by June 2022. Monarch has already made shipments of ore to the mill, and there are 15,000 tonnes of ore ready for processing when the mill restarts.

"We are pleased to partner with Monarch as it prepares to restart production at its past-producing Beaufor Mine later this year and continues to expand near-mine resources with ongoing exploration," said Shaun Usmar, Founder and CEO of Triple Flag. "Beaufor is located in the Abitibi mining camp in Quebec, a top-tier mining jurisdiction, and this royalty will provide Triple Flag with near-term cash flows that will persist for years to come. In the last mineral resource update, Monarch managed to more than double its measured and indicated mineral resources and has since drilled a further 25,000 metres. We are excited about the addition of this high-quality asset to our portfolio."

"We are thrilled to partner with Triple Flag, a leading global partner whose investment objectives are aligned with our own values and growth objectives," said Jean-Marc-Lacoste, President and Chief Executive Officer of Monarch. "This new non-dilutive investment will also allow us to strengthen our financial position as we continue to prepare our Beaufor Mine and Beacon Mill for a restart by June 2022."

Triple Flag will acquire the Beaufor royalty through two transactions. First, Triple Flag has entered into a binding agreement with a third party to acquire an existing 2% net smelter returns royalty (with a milestone-based stepdown to 1%) on the Beaufor Mine for C$6.75 million. Second, Triple Flag has entered into a binding agreement with Monarch to provide Monarch with additional funding of C$4.50 million in consideration for increasing the royalty rate to 2.75% and eliminating the step-down. The transactions are expected to close on or around February 11, 2022, and will be funded from cash on hand.

Beaufor Highlights:

Restart of established operation in Quebec providing near-term cashflow

  • Beaufor is an underground gold mine located in the prolific Abitibi mining camp in Quebec.
  • Provides Triple Flag with exposure to a past-producing gold mine at which Monarch is expecting to restart production by June 2022, providing immediate cash flow. Monarch has commenced shipment of ore to the mill and has approximately 15,000 tonnes of ore ready for processing when the mill restarts. Monarch's objective is to begin by processing barren rock to recommission the plant, and then process ore and pour the first gold bar, which it expects to take approximately 6 to 10 weeks.
  • Ore is planned to be treated at Monarch's 100%-owned 750 tpd Beacon Mill, located 10km from the Beaufor Mine.
  • The Beaufor Mine began producing in the early 1930's and has yielded a total of over 1.2 million ounces of gold at an average grade of 7.34 g/t1.

Substantial Potential for Mineral Resource Expansion

  • Monarch recently reported a significant increase to its mineral resource estimate in 2021: measured and indicated mineral resources increased by 136% to 219.2 koz contained gold and inferred mineral resources increased by 300% to 122.5 koz contained gold over previous estimates. See the below table for the current Mineral Resource Estimate. Since the date of this mineral resource estimate, Monarch has completed more than 25,000 metres of additional drilling in 105 holes.
  • Monarch recently completed a 42,500-metre diamond drilling program to test areas around historical high-grade intersections near existing underground infrastructure and isolated mineral resource blocks. Given the positive results, additional holes are now being drilled to upgrade the mineral resource classification to measured and indicated to form the basis of a future mine plan. Monarch continues exploration and development drilling with five drill rigs underground.

Royalty Overview

  • Provides Triple Flag with a right of first refusal over future royalties or streams covering the Beaufor Mine.
  • Royalty covers the entirety of the Beaufor block of claims.
  • Triple Flag plans to utilize existing tax pools to fully shelter expected royalty income.

Beaufor Mine Mineral Resource Estimate2:

Category Tonnage (t) Grade (g/t Au) Contained Ounces Au (oz)
Measured 328,500 5.7 59,900
Indicated 956,400 5.2 159,300
Measured and Indicated 1,284,900 5.3 219,200
Inferred 819,900 4.7 122,500

 

Source: https://www.monarchmining.com/our-assets

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