Ely Gold has signed a binding letter of intent (the "Transaction") with a private individual ("the Owner")
whereby Ely Gold will acquire 100% of all rights and interests to a Per
Ton Royalty Interest on the Jerritt Canyon Processing Facilities (the "
The Jerritt Canyon Operations, located in Elko Nevada, encompasses a
number of underground operations, and are operated by Jerritt Canyon
Gold LLC, a privately held company
The PTR Interest was granted in an Amended License Agreement dated May
19, 2015 between former operator, Veris Gold Corp., JCG (formerly WBVG
LLC) and the Owner (the "
Pursuant to the terms of the License Agreement, the Owner granted to JCG
a perpetual license for the patent to certain proprietary scrubbing
technology involved in the removal of mercury from gas that is currently
being used at the Jerritt Canyon Processing Facilities. The License
Agreement entitles the Owner to receive a Per Ton Royalty Payment (the "
based on overall throughput from mining operations at the Jerritt
Canyon Processing Facilities. As a production royalty, the source of the
mill feed would include any contract that JCG would enter for toll
milled ore. The term of the License Agreement is for a period ending on
the earlier of the expiration of the Patent or the life of the Jerritt
The PTR Payment is based on the Average Realized Gold Price ("ARGP") which is 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:
$0.15 per ton if the ARGP is less than or equal to $1,300 per ounce; or
$0.225 per ton if the ARGP is greater than $1,300 but less than or equal to $1,600 per ounce; or
$0.30 per ton if the ARGP is greater than $1,600 but less than or equal to $2,000 per ounce; or
$0.40 per ton if the ARGP is greater than $2,000 per ounce.
Since mining began at Jerritt Canyon, more than eight million ounces of
gold have been produced. Gold was first discovered at Jerritt Canyon in
1972, with the first gold poured in 1981. Underground operations began
in 1993. The mineral processing operation at Jerritt Canyon is one of
only three gold processing plants in Nevada that uses roasting in its
treatment of refractory ores. Jerritt Canyon is designed to process
highly refractory gold ores up to 4,000 TPD and has processed in excess
of 1.1 million tons in 2017 and 1.2 million tons in 2018.