The North American Gold Royalty Company

Jerritt Canyon NSR

0.5% NSR Royalty + PTR

LOCATION Elko County, Nevada
OPERATOR Jerritt Canyon Gold LLC (private company)
ROYALTY Per Ton Royalty (PTR) + 0.5% NSR
STATUS Production
REVENUE Accruing from Feb 2020

The Jerritt Canyon Mine, located 50 miles north of Elko, Nevada, encompasses the Jerritt Canyon processing plant and four gold mines. Since mining began at Jerritt Canyon in 1981, more than 8M ounces of gold have been produced. Other than 2009, the mine has operated continuously.

Overview – One of Three Roasting Circuits in Nevada

The Jerritt Canyon processing facility represents one of only three such plants in Nevada that uses roasting in its treatment of refractory ores. Initially, Jerritt Canyon was designed to process oxide and mildly refractory gold ores. In 1989, the roasting circuit was added to the process for the treatment of highly refractory ores which are now being mined and processed at Jerritt Canyon.

Royalty Structures

The Per Ton Royalty (PTR) Payment is based on the Average Realized Gold Price (ARGP), derived by dividing Total Gold Revenue during the previous month by Gold Ounces Sold during the previous month. Royalties would be calculated, in US$, as:

  1. $0.15 per ton if the ARGP is less than or equal to $1,300 per ounce; or
  2. $0.225 per ton if the ARGP is greater than $1,300 but less than or equal to $1,600 per ounce; or
  3. $0.30 per ton if the ARGP is greater than $1,600 but less than or equal to $2,000 per ounce; or
  4. $0.40 per ton if the ARGP is greater than $2,000 per ounce.

In May 2020, Ely purchased a 0.5% Net Smelter Returns (NSR) royalty on the Jerritt Canyon Mine from Eric Sprott. Under this agreement, Ely Gold will receive 0.5% of the revenue from sale of the mine’s output, less transportation and refining costs. The royalty payments began to accrue in February 2020.

Reserves, Grades & Operations

Measured and Indicated Resources at Jerritt Canyon Mine (as at June 30, 2018 per NI 43-101 Technical Report dated Sep 28, 2018) – Above Water Table:

Measured + Indicated Inferred
Tons oz/short ton Au Contained Gold (oz) Tons oz/short ton Au Contained Gold (oz)
Totals 4,419,139 0.158 873,603 1,459,200 0.191 278,671

All underground mines at Jerritt Canyon are less than 1000 feet in depth. Low profile 35 and 40-ton tractors are used to remove ore, which is then stacked near the mine portals for grade sampling. After sampling, ore is transported by 150-ton haul trucks to the mills, where the feed is dried and roasted. Gold is recovered using conventional carbon-in-leach processing. High quality gold bars are then shipped for commercial refining and sale.

Gold mineralization occurs in both upper plate and lower plate stratigraphy. While approximately 30% of the 119 square mile land package has experienced first-pass exploration, most of the property outside the mined areas has not been explored.

Jeritt Canyon News

Technical Report