EMX’s royalty portfolio in Serbia initially resulted from prospect generation and organic royalty growth via the 2006 sale of its properties, including Brestovac West, to Reservoir Capital Corp., for uncapped NSR royalties of 2% for gold and silver and 1% for all other metals. Reservoir Capital Corp. later transferred those interests to Reservoir Minerals Inc. (“Reservoir”). Subsequently, EMX acquired 0.5% NSR royalty interests (note: the royalty percentage is subject to reduction only as provided in the royalty agreement) covering the Brestovac and Jasikovo-Durlan Potok properties (see EMX news release dated February 4, 2014), which along with Brestovac West, are included in the Timok Project controlled by Nevsun Resources Ltd. (“Nevsun”) after its acquisition of Reservoir in 2016. EMX notes that: a) the original Brestovac and Brestovac West permits are now covered by the Brestovac Metonivca and Brestovac Zapad permits, and b) portions of a reconfigured Jasikovo-Durlan Potok permit (i.e., expanded in some areas and reduced in other areas) are not covered by the EMX royalty. In December 2018 Nevsun Resources Ltd. was acquired by Zijin Mining Group Co. Ltd. (Zijin) a Chinese company.
The Brestovac royalty property covers the Cukaru Peki deposit’s Upper and Lower Zones that host high sulfidation epithermal and porphyry copper-gold mineralization, respectively. In 2017, Nevsun reported an updated Preliminary Economic Assessment (“PEA”) for the Timok Project’s Upper Zone with measured resources of 2.2 million tonnes averaging 8.6% copper and 5.7 g/t gold, indicated resources of 26.6 million tonnes averaging 3.3% copper and 2.1 g/t gold, and inferred resources of 13.9 million tonnes averaging 1.6% copper and 0.9 g/t gold at a “Resource NSR” cutoff of US $35/tonne (based upon $3.49/lb Cu, $1,565/oz Au, and technical and economic parameters given in the PEA study) (see Nevsun news release dated October 26, 2017).
In May of 2018, Nevsun announced the results of a pre-feasibility study (“PFS”) for the Upper Zone project (see Nevsun news release dated May 28, 2018). The PFS outlined a pre-construction NPV8 of US$1.82 billion over a 10 year mine life, with 1.7 billion pounds of payable copper and 516 thousand ounces of payable gold. An exploration decline was started in 2018, and a feasibility study is planned for mid-2019, with initial production expected in 2022 (see Nevsun news release dated March 28, 2018).
In addition to the Upper Zone work, Nevsun has completed a $20 million Lower Zone drill program (see Nevsun news release dated March 26, 2018). The Lower Zone porphyry project is in a joint venture with Freeport. Drill results for the Lower Zone, which outlines a 1,100 by 2,000 meter footprint of porphyry copper-gold mineralization, include 1.08% copper and 0.27 g/t Au over 747.4 meters starting at 1,341 meters (true width estimated to be ~50-60%) (see Nevsun news release dated December 4, 2017). Nevsun is currently working on an initial Lower Zone resource estimate (see Nevsun news release dated June 5, 2018).
EMX’s Brestovac West royalty property is ~700 meters west of Cukaru Peki and contains the Corridor Zone high-grade gold prospect and the Ogashu Kucajna epithermal gold occurrence. The Jasikovo East-Durlan Potok property occurs to the north in the Timok copper-gold belt.
The Company’s Timok royalty properties add strategic upside potential in one of the richest copper-gold mineral belts in Europe.
See EMX news releases dated October 30, 2006 and February 4, 2014 for more information.