Electric Royalties Announces Agreement to Acquire Cash-Flowing Copper Stream from Minera Cobre Verde IN Chile
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ELECTRIC ROYALTIES ANNOUNCES AGREEMENT TO ACQUIRE CASH-FLOWING COPPER
STREAM FROM MINERA COBRE VERDE IN CHILE
VANCOUVER, BRITISH COLUMBIA – September 18, 2024 – Electric Royalties Ltd. (TSXV: ELEC) (OTCQB:
ELECF) (“Electric Royalties” or the “Company”) is pleased to announce the signing of a binding letter
agreement dated September 17, 2024 (the “Agreement”) with Minera Cobre Verde (“MCV”), a subsidiary
of Cobre y Metales, to acquire a copper stream (the “Stream”) on the Minera Cobre Verde Mine (“MCV
Mine”), located in the Antofagasta Region of Chile (the “Transaction”).
Under the terms of the Agreement, Electric Royalties will pay consideration to MCV of US$2.1 million to
acquire the Stream, whereby Electric Royalties will have the immediate right to acquire a fixed amount
of 76,000 pounds of copper monthly at a fixed price of US$2.75 per pound for a term of four years. The
Stream will be cash-settled and is not dependent on actual copper production at the MCV Mine.
The parties will also have the opportunity (by mutual agreement) within 30 days of closing of the
Transaction to increase the amount of the Stream by an additional 76,000 pounds of copper monthly
(the “Opportunity”) by Electric Royalties paying an additional US$2.1 million in cash to MCV.
Brendan Yurik, CEO of Electric Royalties, commented, “With this transaction, Electric Royalties is gaining
direct exposure to copper prices over the next four years and is progressing towards becoming cash
flow positive ahead of our numerous advanced royalties expected to enter or re-enter production over
the next six to 48 months.
“We are thrilled to be partnering with MCV on our first streaming acquisition – a transaction that’s
expected to significantly boost our revenue and cash flow on a per share basis, while also providing
long-term potential to partner and help fund production expansion in the future . MCV routinely
lowers risk by buying production material from multiple local sources, an approach in which Franck
Lançon and his management team have tremendous experience.”
Neither MCV nor Cobre y Metales is a Non -Arm’s Length Party of the Company or its Associates or
Affiliates, within the meaning of TSX Venture Exchange policy.
Transaction Highlights:
• Accretive to Electric Royalties’ cash flow
o Electric Royalties expects to potentially benefit from copper prices projected to reach
US$10,100 per metric ton in 2025 , according to a Goldman Sachs note published on
September 2, 20241.
o The Stream will have a term of four years from closing. Payments will be settled in cash
rather than physical copper and will be calculated each month as copper payable
multiplied by the difference between the average LME monthly spot price and the fixed
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copper price of US$2.75 per pound.
o Illustrative potential revenues from the Stream are as follows:
▪ at a copper price of US$ 11,000 per metric ton, equating to approximate ly US$5
per pound, the Stream (without exercise of the Opportunity) would equate to a
monthly revenue stream of approximately US$162,450 (approximately US$1.95
million annually).
▪ at a copper price of US$11,000 per metric ton and if the Opportunity is exercised,
the monthly revenue stream will be approximately US$32 4,900 (approximately
US$3.9 million annually).
▪ at a copper price of US$8,800 per metric ton, equating to approximately US$4 per
pound, the Stream (without exercise of the Opportunity) would equate to a
monthly revenue stream of approximately US$90,250 per month (approximately
US$1.1 million annually).
▪ at a copper price of US$8,800 per metric ton and if the Opportunity is exercised,
the monthly revenue stream will be approximately US$180, 500 (approximately
US$2.2 million annually).
o Provides Electric Royalties immediate cash flow over the next four years while portfolio
royalties mature and provides high leverage to potentially increasing copper prices ,
provided there is no guarantee that copper prices will increase or even maintain at
current prices over the term of the Stream.
• Minera Cobre Verde highlights
o Excellent mining jurisdiction in Region II, Antofagasta Chile, situated 40km away from
the Port of Antofagasta.
o Former Ivan SX-EW plant and Rayrock mine acquired in 2023 from FIP Neith including:
▪ SX-EW plant capable of producing 10,000 tonnes per annum of copper cathode2.
▪ existing agglomeration and leaching circuits with expansion potential3.
The Transaction noted herein (including any finder’s fee) is subject to completion of due diligence,
securing necessary financing, and approval of the TSX Venture Exchange and other customary conditions.
Finder’s Fee
The company has agreed to pay a finder’s fee to Phaedrus Dynamic Inc. (“Phaedrus”) in connection with
the Transaction. The finder’s fee will be payable by the Company to Phaedrus as and when the Company
receives payment under the Stream, on the basis that the Company will pay to Phaedrus the cash value
of 3,800 pounds of copper, net of US$2.75 per pound, in respect of each month during the term of the
Stream. This equates to 5% of the 7 6,000 pounds per month of copper that the Company will receive
under the Stream (cash settled against the fixed price of US$2.75 per pound).
In the event that the Opportunity is exercised to increase the Company’s monthly entitlement under the
Stream by a further 76,000 pounds of copper per month, the finder’s fee payable to Phaedrus would be
increased by a further 3,800 pounds of copper per month (in each case on the same cash -settled basis,
net of US$2.75 per pound).
Phaedrus is not a Non -Arm’s Length Party of the Company, MCV , Cobre y Metales or their respective
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Associates and Affiliates, within the meaning of TSX Venture Exchange policy.
Financing
Electric Royalties may syndicate the transaction to finance the acquisition. The Company has the right to
divide the Stream interest among such parties.
David Gaunt, P.Geo., a qualified person who is not independent of Electric Royalties, has reviewed and
approved the technical information in this release.
About Electric Royalties Ltd.
Electric Royalties is a royalty company established to take advantage of the demand for a wide range of
commodities (lithium, vanadium, manganese, tin, graphite, cobalt, nickel, zinc and copper) that will
benefit from the drive toward electrification of a variety of consumer products: cars, rechargeable
batteries, large scale energy storage, renewable energy generation and other applications.
Electric vehicle sales, battery production capacity and renewable energy generation are slated to increase
significantly over the next several years and with it, the demand for these targeted commodities. This
creates a unique opportunity to invest in and acquire royalties over the mines and projects that will supply
the materials needed to fuel the electric revolution.
Electric Royalties has a growing portfolio of 40 royalties in lithium, vanadium, manganese, tin, graphite,
cobalt, nickel, zinc and copper across the world. The Company is focused predominantly on acquiring
royalties on advanced stage and operating projects to build a diversified portfolio located in jurisdictions
with low geopolitical risk, which offers investors exposure to the clean energy transition via the underlying
commodities required to rebuild the global infrastructure over the next several decade s toward a
decarbonized global economy.
For further information, please contact:
Brendan Yurik
CEO, Electric Royalties Ltd.
Phone: (604) 364‐3540
Email: [email protected]
https://www.electricroyalties.com/
Neither the TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the
policies of the TSX Venture Exchange), nor any other regulatory body or securities exchange platform,
accepts responsibility for the adequacy or accuracy of this release.
1 https://www.bnnbloomberg.ca/business/international/2024/09/03/goldman -slashes-copper-forecast-on-
softening-chinese-demand/
2 Coro Mining Corp. news release dated June 9, 2017 https://marimaca.com/coro-signs-purchase-agreement-for-
acquisition-of-ivan-sxew-plant-for-marimaca-project-chile/
3 Definitive feasibility study for Marimaca 1-23 Claim Project, Antofagasta, II Region, Chile, NI 43101 Technical
Report, effective date June 13, 2018, prepared by Enrique Quiroga V., Luis Oviedo, and Carlos Guzmán, filed under
Marimaca Copper Corp.’s profile on sedarplus.ca
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Cautionary Statements Regarding Forward-Looking Information and Other Company Information
This news release includes forward -looking information and forward -looking statements (collectively,
"forward-looking information") with respect to the Company within the meaning of Canadian securities
laws. This news release includes information regarding other companies and projects owned by such other
companies in which the Company may hold a royalty, metal stream, security or other interest, or on which
such other companies’ economic interests (and the ability of such other companies to satisfy obligati ons
to the Company) may depend, based on previously disclosed public information disclosed by those other
companies and the Company is not responsib le for the accuracy of that information, and that all
information provided herein is subject to this Cautionary Statement Regarding Forward -Looking
Information and other company information. Forward looking information is typically identified by words
such as: believe, expect, anticipate, intend, estimate, postulate and similar expressions, or are those,
which, by their nature, refer to future events. This information represents predictions and actual events or
results may differ materially. Forward -looking information may relate to the Company’s future outlook
and anticipated events and may include statements regarding the projected future mine production,
financial results, future financial p osition, expected growth of cash flows, business strategy, budgets,
projected costs, projected capital expenditures, taxes, plans, objectives, industry trends and growth
opportunities of the Company and the projects in which it holds royalty interests.
While management considers these assumptions to be reasonable, based on information available, they
may prove to be incorrect. Forward -looking statements involve known and unknown risks, uncertainties
and other factors which may cause the actual results, p erformance or achievements of the Company or
these projects to be materially different from any future results, performance or achievements expressed
or implied by the forward-looking statements. These risks, uncertainties and other factors include, but are
not limited to risks associated with general economic conditions; adverse industry events; marketing costs;
loss of markets; future legislative and regulatory developments involving the renewable energy industry;
inability to access sufficient capital from internal and external sources, and/or inability to access sufficient
capital on favourable terms; the mining industry generally, recent market volatility, income tax and
regulatory matters; the ability of the Company or the owners of these projects to implement their business
strategies including expansion plans ; the ability of the Company’s contractual counterparties to honour
their obligations to the Company; competition; currency and interest rate fluctuations, and the other risks.
The reader is referred to the Company’s most recent filings on SEDAR + as well as other information filed
with the OTC Markets for a more complete discussion of all applicable risk factors and their potential
effects, copies of which may be accessed through the Company’s profile page at sedarplus.ca and at
otcmarkets.com.