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Barkerville selling royalty on Cariboo mine to Osisko Gold for up to C$33M

Barkerville Gold Mines Ltd. entered into a second amended and restated royalty purchase agreement with Osisko Gold Royalties Ltd., which will acquire a 1.75% net smelter royalty on its Cariboo gold mine in British Columbia for C$20 million.

The company said Sept. 6 that it could also grant Osisko Gold an additional 1% NSR on the project for another C$13 million in cash any time between closing and the end of 2018.

The deal would increase Osisko Gold's royalty on the mine to 4% from 2.25% and to 5% if the option is exercised.

Barkerville noted that the C$20 million will be available immediately, and C$2 million will be held in a restricted account until certain conditions are satisfied. The additional royalty is subject to the same conditions.

As part of the deal, which remains subject to final approval from the TSX Venture Exchange, Barkerville will grant Osisko Gold 10 million share purchase warrants. The warrants are exercisable at 75 Canadian cents per share for 36 months from closing.

Barkerville will use the proceeds to fund exploration and studies on Cariboo and for general corporate purposes.

Osisko Gold Royalties, which holds 32.4% of Barkerville, took part in a 2017 private placement by the company that raised C$35 million.