Vancouver, British Columbia--(Newsfile Corp. - February 3, 2020) - Ely Gold Royalties Inc. (TSXV: ELY) (OTCQB: ELYGF) ("Ely Gold") or the ("Company") and its wholly owned subsidiary, Nevada Select Royalty, Inc ("Nevada Select") are pleased to announce that they have signed a binding term sheet (the "Agreement") for the purchase of seventy-five (75) patented mining claims from Cliff ZZ LLC, a Nevada limited liability company. ("Cliff ZZ"). The patented claims are located in Esmeralda and Nye Counties, Nevada and are known as the Tonopah Extension Claims ("Tonopah Extension"). Nevada Select currently holds 23 patented mining claims and 17 unpatented mining claims contiguous to the Tonopah Extension. Closing of the transaction is subject to TSXV approval and final due diligence by Ely Gold. Closing is expected on or about May 2, 2020.
The Tonopah District
The Tonopah District is an epithermal precious metal deposit of the quartz-adularia type. The quartz-adularia type may be divided into gold-rich and silver-rich subtypes. Tonopah Extension is a prominent example of the silver-rich subtype. Some silver-rich quartz-adularia type deposits have significant base metal content, but Tonopah is relatively base metal poor. The only larger deposit of this type known in the United States is the Comstock Lode, a relatively gold rich deposit, which has greater total production of both gold and silver than Tonopah. The Tonopah District has produced 174 million ounces of silver and 1.86 million ounces of gold.
The Agreement
Under the terms of the Agreement to acquire 100% of the Tonopah Extension, Nevada Select will pay Cliff ZZ $650,000 in cash and issue 600,000 Ely Gold share purchase warrants. Each warrant will be exercisable into one common share at $0.65 for a period of two years. The transaction is subject to TSXV approval and due diligence. Cliff ZZ will not retain any royalties after Closing.
Trey Wasser, President and CEO commented, "This transaction supports our business model of consolidating under-explored districts while generating royalty interests. We consider Tonopah to be one of the best districts in Nevada based on past production and exploration potential." |
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