Vancouver — Colorado-based Canyon Resources (CAU-A) has inked a deal with Franco-Nevada Mining (FN-T) to pick up the 2% net smelter royalty on the first 175,000 oz, of gold produced from its Briggs mine in California.
In return, Franco Nevada gets 1.05 million Canyon Resource shares, plus an additional 1% net smelter royalty on gold production greater than 175,000 oz. The deal, slated to start April 1, gives the Canadian royalty company a 7.3% stake in the junior producer.
In the second quarter, Canyon Resources posted a net loss of US$1.8 million, or 14 per share with the Briggs operation contributing 23,180 oz. gold and 5,000 oz. silver.
The heap-leach operation has turned out 45,707 oz. gold and 9,400 oz. silver in the first half of 2001, compared with 44,309 oz. gold and 10,000 oz. silver a year earlier. Cash costs were US$237 per equivalent gold oz. during the 6-month period, down from US$267 per oz. a year earlier.
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