Metalla adds Barrick’s Lama project to royalty portfolio

Metalla Royalty & Streaming (NYSE American: MTA) (TSXV: MTA) announced on Monday a major addition to its royalty portfolio: the world-class Lama project in San Juan, Argentina, held by Barrick Gold (NYSE: GOLD; TSX: ABX).

Under a royalty purchase agreement with an arm's length third party, Metalla would acquire an existing 2.5% to 3.75% gross value return (GVR) royalty on gold and silver, and a 0.25% to 3.0% net smelter return (NSR) royalty on copper and other non-precious minerals, extracted from the majority of the Lama project. Total consideration will be US$7.5 million in common shares and cash.

"The Lama project is part of one of the largest gold deposits in the world currently being contemplated by Barrick as a standalone operation. Our royalty will provide Metalla shareholders with outstanding exposure to one of the most significant geological gold-bearing trends with a substantial amount of near-term growth, exploration upside and first in class operator," commented Brett Heath, president and CEO of Metalla.

Lama represents the Argentine portion of Barrick's 21-million-ounce Pascua-Lama gold project straddling the border between Chile and Argentina. The Chilean Pascua portion has been placed into a closure process, while the Argentina Lama portion, which has contained metal of 3.13Moz gold and 236.9Moz silver, is being considered as a standalone underground project as part of a potential Veladero-Lama complex operation.

To date, Barrick has spent over US$4 billion on infrastructure in the vicinity, and the Lama project would utilize the semi-completed process plant and tailings facilities. The gold miner has outlined a block cave underground Lama project with an initial processing capacity of 13-15 Kt/d with the potential to expand to 30 Kt/d in the future.