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Ilovica

Greek Macedonian Flag

Operator: Euromax Resources Ltd.

Location: Bosilovo, Macedonia

Stream:

25% of Payable Gold (subject to conditions)

Term of Stream: Life of Mine

Ilovica is a porphyry copper-gold deposit, owned by Euromax Resources DOO Skopje, a wholly-owned subsidiary of Euromax Resources Ltd. Ilovica is located in southeast Macedonia, within the municipality of Bosilovo, approximately 15 kilometers west of the Bulgarian border and approximately 20 kilometers east of the town of Strumica.

The main sulfide mineral at Ilovica is chalcopyrite, followed by pyrite, and secondary copper sulfides such as chalcocite, covellite, and bornite. Molybdenite, galena, and sphalerite are present in minor amounts, and occasional traces of sulphosalt minerals such as tetrahedrite-tennantite and tellurides of gold and silver are observed.

Euromax completed a feasibility study for Ilovica in January 2016. Mining at a rate of 10 million tonnes per year is planned via conventional open-pit methods using a large-scale mining fleet. Good continuity of grade in the main mineralized areas enables mining to be carried out at a low strip-ratio of 1:1. Ore will be milled by semi-autogenous grinding (SAG) and ball mills and then processed by a concentrator using conventional flotation to produce a copper-gold concentrate with the cleaner-scavenger tailings being re-treated to recover further gold doré on site.

Optimization and permitting work is underway.

On October 21, 2014, Royal Gold, through its wholly-owned subsidiary Royal Gold AG, announced a US$175 million gold stream transaction with Euromax Resources Ltd. to finance a significant portion of the construction of the Ilovica gold-copper project in Macedonia. Upon completion of the investment, Royal Gold is entitled to 25% of the payable gold until 525,000 ounces of payable gold have been delivered, and 12.5% thereafter. The purchase price for gold ounces delivered is 25% of the London PM gold fix price as quoted in United States dollars per ounce by the London Bullion Market Association (LBMA) on the date of delivery.

Under the terms of the agreement, Royal Gold paid two advance deposit payments totaling US$15 million towards the completion of a definitive feasibility study on Ilovica. A third payment of US$160 million towards project construction remains subject to certain conditions. Early termination provisions allow the return of Royal Gold’s US$15 million investment under certain circumstances or, alternatively, allow Royal Gold to retain a gold stream calculated as 2.0% of Ilovica’s gold production for the life of the project with no further investment beyond the first US$15 million.