Osisko Announces Royalty Transaction On The Namdini Gold Project In Ghana; Announces That It Has Acquired A 1% Net Smelter Return; Closed The Transaction With Savannah Mining, Acquiring A Direct Interest In 50% Of Savannah's 2% NSR Royalty For $35M

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Osisko Gold Royalties Ltd (the "Corporation" or "Osisko") (OR: TSX & NYSE) is pleased to announce that it has acquired a 1.0% net smelter return ("NSR") royalty (the "Royalty") covering the Namdini Gold Project ("Namdini") in Ghana. Osisko has closed the transaction with Savannah Mining Limited ("Savannah"), acquiring a direct interest in 50% of Savannah's 2.0% NSR royalty for total consideration of US$35 million (excluding applicable taxes and levies).

HIGHLIGHTS

Near-term gold equivalent ounces ("GEO") from a Fully-Permitted Project Currently Under Construction

  • Namdini is on the verge of becoming one of Western Africa's next significant producing mines with gold production over the initial three years expected to reach approximately 360,000 ounces per year, and an average 287,000 ounces per year over an initial 15-year life of mine;
  • First gold production from Namdini is expected in late 2024;
  • As of mid-October 2023, Namdini's 34.5 kV distribution power lines to site, connected to the national power grid 30km west of the project, were 99% complete; in addition, Namdini's plant bulk earthworks were 99% complete, while the CIL and Flotation tailings storage facilities were 29% and 39% complete, respectively.

     

Operator is a Large-Scale and Experienced Global Miner

  • Namdini is controlled and will be operated by Shandong Gold Co Ltd. ("Shandong"), a large-scale and well-capitalized global miner with a history of development and operational expertise;
  • Shandong operates Namdini through its subsidiary Cardinal Namdini Mining Limited ("Cardinal"), which is owned in partnership with a subsidiary of China Railway Construction Group Corp Ltd.

Jurisdiction with Well-Established Mining Act and Laws

  • Ghana is a top gold mining jurisdiction, ranked 6th in global gold production, and ranked 1st amongst African nations in 2022, based on data from the World Gold Council;
  • Payments associated with Ghanian Withholding and Value-Added Taxes (VAT), plus associated levies, result in an additional cash outlay by Osisko to the relevant authorities of US$7.7 million.

Osisko Granted Additional Rights

  • As part of the transaction Savannah has granted Osisko certain additional rights.

Paul Martin, Interim CEO of Osisko commented: "Today's announcement highlights Osisko's continued ability to uncover and execute on accretive precious metals transactions. Namdini is a long-life, low-cost, open-pit gold project located in Ghana, one of West Africa's most prolific gold producing countries. The project is being advanced through construction and into production by Shandong; a company which Osisko is confident will continue to develop and operate the mine in a responsible manner. We look forward to having the 1.0% NSR on Namdini contribute to our near-term cash flows and GEO growth profile."

NAMDINI GOLD PROJECT

The Namdini Gold Project is an open-pit gold project located in Ghana, approximately 50 km southeast of the town of Bolgatanga, and close to the southern border of Burkina Faso. In January 2021, Shandong closed the A$540 million (~US$400M) acquisition of the company that owned Namdini, Cardinal Resources Inc.

An October 2019 NI 43-101 compliant Feasibility Study on Namdini, completed by Lycopodium for the previous project owner Cardinal (the "Feasibility Study"), outlined average annual gold production of 287,000 ounces over an initial 15-year mine life. The Feasibility Study also highlighted ~421,000 ounces of gold to be produced in the first 12 months of operation, and 1.1 million ounces forecasted in the first 3 years of full production. The total Proven and Probable Ore Reserve in the Feasibility Study was estimated at 138.6 Mt at 1.13 g/t Au with a contained gold content of 5.1 Moz. Of this total, 92% of the contained gold was within the Probable Ore Reserve category.

The Feasibility Study also highlighted the development of a single open-pit mine feeding a conventional crushing, SAG mill, regrind, high shear oxidation and CIL circuits, with development expected to initially focus on a high-grade starter pit area towards the north of the deposit.

Qualified Person

The scientific and technical content of this news release has been reviewed and approved by Guy Desharnais, Ph.D., P.Geo., Vice President, Project Evaluation at Osisko Gold Royalties Ltd, who is a "qualified person" as defined by National Instrument 43-101 – Standards of Disclosure for Mineral Projects ("NI 43-101").

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