Thursday, 25th January 2007 (2453 views)

The deal that Royal Gold entered into with Minera Kennecott over the two per cent net smelter return at the Penasquito project in Zacatecas, Mexico has been closed.

Comprising two deposits - Chile Colorado and Penasco - the Penasquito property is said to contain one of the largest deposits of gold, silver and zinc in the world.

Closure of the deal was first announced last year on December 29th and the price of the acquisition is $80 million (£40.6 million) cash along with 577,434 shares.

Royal Gold controls and manages precious metal mine royalties which it then offers to investors in order to operate within this sector.

Back in December, Tony Jenson, Royal Gold's president and CEO, said: "We are very pleased to obtain this substantial royalty on a world class, long-life project and become associated with yet another senior mining company."

Following a feasibility study undertaken last July, the Penasquito site holds probable and proven reserves of ten million ounces of gold.

 

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