Acquisition of Near-Term Producing Gold Royalty

Trident Royalties Plc (AIM:TRR, FSX:5KV), the growth-focused mining royalty and streaming company, is pleased to announce that it has entered into a binding agreement with Seduli Sutter Operations Corporation (“Seduli”) to acquire a Net Smelter Return (“NSR”) royalty (the “Royalty”) over production from the Lincoln Gold Mine (“Lincoln”, or the “Project”), located in California, USA. Seduli intends to utilise the royalty sale proceeds to finalise the restart of Stage 1 production at the Lincoln underground gold mine.

HIGHLIGHTS

A compelling asset targeting commencement of Stage 1 production in 2021

• A near term cash-generative royalty over a low-cost, high-grade asset which plans to commence Stage 1 production of 220 tonnes-per-day in 2021, targeting approximately 20,000+ ounces of gold per year1
• The Project is permitted for Stage 2 production of up to 1,000 tonnes-per-day (80,000+ ounces per year), which is anticipated to commence, subject to funding, immediately following successful completion of Stage*
• Prior to the stepdown in royalty rate, Stage 1 is expected to generate over US$0.5 million per year in pre-tax royalty revenue, increasing to over US$2 million per year in Stage 2**

A high-grade asset located in a Tier-1 jurisdiction, with significant exploration potential

• Lincoln is a high-grade gold deposit with an existing NI 43-101 Mineral Resource Estimate of over 286,000 gold ounces at an average grade of 9.3 grams per metric tonne***
• Lincoln is situated at the centre of the California “Mother Lode”, which has historically produced approximately 13.6Moz of gold, with 3.4Moz of gold reported from the Lincoln Project area 3
• Exploration potential is open at depth, with Lincoln having had no drilling below 150m from surface, while historic mines immediately along strike of Lincoln reached 500m to 1,800m below surface
• Trident’s internal review of the geology and Seduli’s most recent deposit re-modelling outlines the potential opportunity for Seduli to build on the current Mineral Resource Estimate and significantly increase the stated Lincoln gold inventory through infill drilling and additional exploration drilling below 150m from surface, subject to the necessary technical work in line with Mineral Resource reporting standards
• As a restart of a previous underground operation, Lincoln benefits from significant existing infrastructure, including a fully refurbished 220 tonne-per-day processing plant with associated workshop and offices, a pre-existing 880m long haulage decline from surface and 900m of production stope development in place

An attractive transaction structure, enhancing Trident’s portfolio

• Structured as a 1.5% NSR royalty on all production from Lincoln (and associated claims which cover approximately 6.25km of Mother Lode strike length), plus any future mineral holdings acquired by Seduli within a 5-mile radius of the current claim boundaries
• The royalty rate decreases to 0.75% upon aggregate royalty payments of $3 million being paid to Trident, remaining at this rate in perpetuity
• Until certain conditions are met, the Royalty retains senior ranking security over all key assets of the Project, including a substantial land package recently appraised at $1.9 million
• The Royalty is structured such that Trident is paid on gold doré and gold contained-in-concentrate, removing the risk of refining penalties adversely impacting royalty revenue

Adam Davidson, Chief Executive Officer of Trident commented:

“The Lincoln Gold Mine represents a highly compelling investment opportunity for Trident, and we are delighted to be supporting Seduli as it restarts mining and gold production in the coming months. The Mother Lode is a mineralised zone of international fame and the discovery of an orebody with an average grade of 9.3g/t, which has not been drilled beyond 150m, offers exceptional upside once in production. With this in mind, we believe that Lincoln will reveal gold ounces orders of magnitude larger than the existing NI 43-101 MRE, subject to the required exploration work and technical studies.”

“Acquiring a new near-term cash generative gold royalty also aligns well with our over-arching strategy to assemble a diversified royalty portfolio, and this new addition is expected to contribute to our two existing paying royalties, in iron ore and copper, in the near-term.”

News in full

CEO Adam Davidson recently provided an update of the business and its strategy below