By Robb M. Stewart
Franco-Nevada will stump up $250 million to help finance Nevada-focused miner i-80 Gold in exchange for a smelter royalty.
The Toronto-based company, which has built up a portfolio of assets generating cash flows from royalty and streaming rights on largely gold assets, said it will buy a 1.5% life-of-mine net smelter return royalty from i-80.
The royalty, which will step up to 3% from 2031, will apply to all of i-80's mineral properties. That includes the operating Granite Creek underground mine, Archimedes Underground that is being developed, and assets being studied such as the Granite Creek open pit and Cove underground project.
I-80 Gold has a three-phase development plan to put its projects into production, which it projects will increase annual production from 150,000 to 200,000 ounces of gold in the first phase to 600,000-plus ounces with the final phase in 2032 and beyond.
The capital from Franco-Nevada comes alongside commitments for a gold prepay facility that i-80 signed with National Bank of Canada and Macquarie for an initial advance of $150 million, and a $100 million accordion feature. With the package is finalized, the company said it will have access to $150 million, with the obligation to deliver 39,978 ounces of gold over a 30-month period beginning in January 2028. The total ounces to be delivered for the full $250 million facility is expected represent about 15% of all gold output from January 2028 to June 2030.
I-80 said the proceeds from the up to $500 million financing package will be used to advance five gold projects through various stages of development, refurbish a plant, and fund resource expansion and drilling. The money also will be used to extinguish its existing debt obligations of about $175 million.
I-80 said it continues to work on the potential sale of a non-core asset and plans to replace its existing convertible debentures to complete its recapitalization.
Write to Robb M. Stewart at robb.stewart@wsj.com
(END) Dow Jones Newswires
02-12-26 0849ET
