Elemental will receive 50% of payable gold production in exchange for consideration of US$11 million until Rambler has delivered 10,000 ounces of gold to Elemental. At that point, Elemental will receive 35% of payable gold production for a further 5,000oz of gold. Once Rambler has delivered 15,000oz of gold, Elemental will receive 25% of payable gold production for the life of the mine.
The non-brokered private placement is for up to 9.275 million common shares of Elemental at a price of C$1.51 per share, up to approximately C$14 million. Elemental said the net proceeds will be used to fund the Ming gold stream and for general working capital purposes.
Elemental also published its guidance range for 2022 at 5,700 to 6,700oz gold-equivalent ounces, which is an increase of at least 54% from 2021 sales. Elemental could expect revenue in 2022 of approximately US$10 million-$12 million at a US$1,800 per ounce average realised gold price.
Preliminary indications for 2023 assume the company could reach 8,100oz AuEq, which would generate more than US$14 million in revenue with an unchanged average realised gold price.
Elemental continues to operate as normal amid recommendations shareholders reject a hostile bid from Gold Royalty. The company is still reviewing alternative options that represent better value for its shareholders.
On 17 March, Elemental Royalties traded on the TSX at C$1,51/share, moving 3.43% higher on the day. Its shares surged above the $1.50 mark just before Christmas last year after hovering at around the $1.30 mark for the four months prior.