Higher reserve figures for the two largest gold producers in Nevada’s Carlin trend mean higher royalty revenues for High Desert Mineral Resources (HDR-V).
Barrick Gold (ABX-T) recently announced that reserves at the Betze-Post mine had reached 12.3 million oz. gold, up from 10.8 million oz. last year.
The increase is attributable to the SJ claim block.
High Desert acquired its
1% royalty on the 16 SJ claims through a non-arm’s-length transaction in September 1997. At that time, the royalty was valued at $34.9 million.
At the HD project, a joint venture between Barrick and Newmont Gold (NGC-N) in which High Desert holds a 2% net smelter return royalty, Newmont has calculated that the Leeville, Turf, Four Corners and Hardy Footwall Extension deposits hold an aggregate proven reserve of 4 million oz. gold.
When High Desert acquired it last September in a non-arm’s-length transaction, the HD royalty was valued at $29.3 million based on 3 million oz.
High Desert has commissioned the consulting firm of
Pincock Allen & Holt to recalculate the value of the SJ and HD royalties.
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