Star Royalties Ltd (CVE:STRR) updated shareholders on its interest in the Copperstone gold operation, saying that the project is on track to start producing gold in the first quarter of 2022.
The Toronto-based firm has a US$18 million gold purchase and streaming agreement with Arizona Gold Corp, Copperstone’s operators.
Funds from Star’s stream will be used to finance the restart of underground operations and gold production at the Arizona-based mine, the company said in a statement.
DEEP DIVE: Star Royalties is pioneering a new kind of streaming model: value creation with a conscience
Operations are expected to restart in the fourth quarter of 2021 ahead of first gold production, Star told shareholders. Operator Arizona Gold is currently in the midst of finalizing its engineering plans, recruiting several key mining consultants and analyzing geotechnical studies to enhance previously estimated production efficiencies, according to a statement.
The company has initiated pre-production mine ground support rehabilitation before beginning stope definition drilling, a requirement for detailed final gold ore stope designs. Work is also ongoing on the mineral processing plant.
Additional reverse circulation infill drilling will likely start in May, and an updated resource estimate is expected in 2Q 2021.
Star Royalties is doling out its $18 million in three equal instalments, with the first two installments already advanced. Both Star and Arizona Gold have agreed to revise the final US$6 million instalment by June 30, 2021, given the current “back-weighted” spending profile, according to a release.
“We are pleased with Arizona Gold’s prudent capital allocation of our stream financing thus far and are encouraged with Arizona Gold’s restart activities and drilling program results announced to date,” Star Royalties CEO Alex Pernin said in a statement.
“Copperstone remains on schedule and on budget for first gold production in 1Q 2022. The Copperstone gold stream continues to represent significant, near-term cash flow for Star Royalties from a highly prospective deposit in a world-class jurisdiction.”
Contact Angela at angela@proactiveinvestors.com
Follow her on Twitter @AHarmantas