- Royal Road Minerals (RYR) has announced the closing of the sale of its 50 per cent interest in the Luna Roja Project
- The company sold its interest to Hemco Nicaragua S.A., a subsidiary of Mineros S.A.
- Hemco agreed to pay US$24,485,294 and a 1.25 per cent net smelter return royalty for the project
- Royal Road Minerals is a gold and copper exploration company focused on projects in Colombia and Nicaragua
- Royal Road Minerals (RYR) is up by 1.41 per cent and is currently trading at $0.36 per share
Royal Road Minerals (RYR) has announced the closing of the sale of its 50 per cent interest in the Luna Roja Project.
The project comprises the Monte Carmelo I and Monte Carmelo II mining concessions in Nicaragua.
The company sold its interest to Hemco Nicaragua S.A., a subsidiary of Mineros S.A.
Transaction terms
Hemco agreed to pay US$24,485,294 for the project. This includes US$20,812,000 in cash on the closing date and US$3,672,794 to be remitted to governmental authorities in accordance with withholding tax requirements under Nicaraguan law.
In addition, Royal Road will receive a 1.25 per cent net smelter return royalty on all future mineral production from the project.
Royal Road also agreed to incur no less than US$7.5 million in project expenditures by May 21, 2026 as approved by a joint Hemco/Royal Road management committee pursuant to the companies’ strategic alliance agreement.
The Luna Roja Project had previously been jointly owned and operated by Hemco and Royal Road pursuant to the terms of a strategic alliance agreement dated September 1, 2017.
Upon closing, the companies amended the alliance agreement to remove Monte Carmelo I and Monte Carmelo II from the area subject to the alliance. The agreement, as amended, continues in effect, including with respect to the jointly-owned Caribe Project and Royal Road’s other joint projects with Hemco in Nicaragua.
The transaction was completed on May 21, 2021.
Royal Road Minerals is a gold and copper exploration company focused on projects in Colombia and Nicaragua.
Royal Road Minerals (RYR) is up by 1.41 per cent and is currently trading at $0.36 per share as of 9:38 am ET.