Altamira Gold announces US$6 Million Gold Forward Purchase Agreement to fund 1,000 tonne per day processing plant at the Cajueiro Gold Project, Brazil
www.altamiragold.com | TSXV: ALTA
1500 - 409 Granville Street, Vancouver, BC V6C 1T2
TEL +1 604 676 5660
Altamira Gold announces US$6 Million Gold Forward Purchase Agreement
to fund 1,000 tonne per day processing plant
at the Cajueiro Gold Project, Brazil
April 27th, 2020 Altamira Gold Corp. (TSXV: ALTA) (FSE: T6UP) (USA: EQTRF), (“Altamira” or
the “Company”) is pleased to announce that it has entered into a definitive gold forward purchase agreement
(the “Agreement”) with Metalstream Ltd. (the “Buyer”), for proceeds of up to USD$6 Million (CAD$8.5
Million). The proceeds will be used for the development of the Cajueiro Gold Project (the “Project”) located
in the state of Mato Grosso, Brazil. At the same time the Company has terminated the agreement with FMS
Investimentos e Participações Ltda. (“FMS”) for the joint development of the project.
Highlights are as follows:
• The Buyer, a gold streaming company, will pay Altamira a total of US$6M, which will be used for
the development of the Cajueiro gold project in Brazil, and Altamira will pay Metalstream a total
of 10,000 ounces of gold over 5 years.
• The Buyer will advance an initial US$1M to Altamira on or before the completion date of 23 June
2020 (the “Completion Date”) and an additional $5 million within 60 days of the Completion Date.
Altamira’s Brazilian subsidiaries will grant Metalstream a 12.5% NSR against the Cajueiro project
as security for the repayment obligations . The NSR will be extin guished following the gold
repayment outlined above which will commence on the earlier of 120 days of commercial
production being declared by Altamira or 36 months from the Completion Date.
• The August 2019 agreement which called for FMS to invest US$2.4M in a 1000t/d Processing
Plant and operate the proposed mine at Cajueiro in return for 50% of the net income following
payback, has been terminated.
Michael Bennett, President & CEO commented “this arrangement with Metalstream is an extremely
important milestone in Altamira Gold´s development and is designed to fund, build, control and operate a
1,000 tonne per day processing plant at Cajueiro. We look forward to transitioning from a proven and
effective gold exploration company to a small junior gold producer which is less dependent on dilutive
equity financings to support its ongoing exploration efforts”.
The Cajueiro project is Altamira’s key project in Brazil and comprises NI 43-101 resources of 5.66Mt @
1.02 g/t gold for a total of 185,000oz in the Indicated Resource category and 12.66Mt @ 1.26 g/t gold for
a total of 515,000oz in the Inferred Resource category (see press release dated 10 th October 2019). Gold
mineralization is open in several directions and at depth.
Terms of the Agreement
Subject to the terms and conditions of the Agreement, Altamira and its wholly owned subsidiary Alta
Floresta Gold Mineração (the “Supplier”), has agreed to sell to the Buyer a stream of 10,000 ounces of
gold, including a minimum of 2,000 ounces of gold per year. All deliveries of gold to the Buyer are required
to be in the form of certified bullion with a fineness grade of greater than 99.50% at a minimum of 2,000
ounces per year, commencing on the earlier of (i) 120 days after comme rcial production is declared at the
Project and (ii) 36 months after the Completion Date.
Subject to the terms and conditions of the Agreement, the Buyer will pay to the Supplier a fixed purchase
price of USD$600 for each ounce of gold that is sold and del ivered by the Supplier to the Buyer for an
aggregate of US$6M. The US$6M cash payment will be advanced to the Supplier in two tranches including
US$1M by June 23, 2020 and an additional US5M within 60 calendar days.
The Supplier will grant to the Buyer up to a 12.5% NSR over the Project (the “Royalty”). The Buyer will
not enforce payments against the Royalty, provided that the terms of the Agreement relating to the delivery
of gold purchased under the Agreement are being met by the Supplier. The Royalty evidenced by the NSR
will be gradually reduced as gold is delivered to the Buyer against the funds provided to the Supplier, and
will expire and be released against the Project upon the date all purchased gold has been delivered to the
Buyer. If the Agreement is terminated for any reason prior to delivery of all gold purchased under the
Agreement, then the Royalty shall survive such termination.
In the event that Metalstream fails to provide the second tranche of US$5M contemplated above, the initial
US$1M may be converted into shares of Altamira at a price which is 50% higher than the volume weighted
average price for the 10 days preceding the notice of non-compliance. Furthermore, in the event that the gold
price exceeds US$2000 per ounce, Altamira and Metalstream shall divide the incremental sales price benefit
on a 40:60 basis respectively.
The Agreement is subject to TSX Venture Exchange acceptance.
Construction is expected to commence in 2020 with the plant start-up scheduled for 2021. The production
decision is not bas ed on a feasibility study of mineral reserves demonstrating economic and technical
viability, and as a result there is increased uncertainty and there are multiple technical and economic risks
of failure which are associated with this production decision. These risks, among others, include areas that
are analyzed in more detail in a feasibility study, such as applying economic analysis to resources and
reserves, more detailed metallurgy and a number of specialized studies in areas such as mining and recovery
methods, market analysis, and environmental and community impacts. In accordance with NI 43-101 and
the companion policy to that instrument, Altamira cannot provide any guidance either in terms of
anticipated gold production or net cash flows.
Rohan Cavaliero, Managing Director of Metalstream stated “We a t Metalstream are highly selective of
the mining operators we partner with. We value sound, ethical and transparent operators and we feel that
Altamira Gold is perfectly aligned with our values and strategies . We are very pleased to have reached a
mutually beneficial a greement with Altamira Gold and look forward to the near -term commencement of
both construction and gold production at the Cajueiro project”.
About Altamira Gold Corp.
The Company is focused on the exploration and development of gold projects within western central Brazil.
The Company holds 11 projects comprising approximately 300,000 hectares, within the prolific Juruena
gold belt which historically produced an estimate d 7 to 10Moz of placer gold. The Company’s advanced
Cajueiro project has NI 43-101 compliant resources of 5.66Mt @ 1.02 g/t gold for a total of 185,000oz in
the Indicated Resource category and 12.66Mt @ 1.26 g/t gold for a total of 515,000oz in the Inferred
Resource category.
Guillermo Hughes, P. Geo., a consultant to the Company as well as a Qualified Person as defined by
National Instrument 43-101, supervised the preparation of the technical information in this news release.
On Behalf of the Board of Directors,
ALTAMIRA GOLD CORP.
“Michael Bennett”
Michael Bennett
President & CEO
Tel: 604.676.5660
Toll-Free: 1-833-606-6271
www.altamiragold.com
Neither the TSX Venture Exchange nor it ’s Regulation Services Provider (as that term is defined in the
policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.
Forward-Looking Statements
Statements in this document which are not purely historical are forward-looking statements, including any
statements regarding beliefs, plans, expectations or intentions regarding the future development of a
processing plant. There is no guarantee that the Buyer will make the payments of US$1 million and US$5
million respectively as contemplated in the Agreement or that the processing plant will be built. Even if
the processing plant is built, there is no guarantee that the Company will be able to reach commercial
production or repay the amounts advanced by the Buyer. It is important to note that actual outcomes and
the Company’s actual results could differ materially from those in such forward-looking statements. Except
as required by law, we do not undertake to update these forward-looking statements.