EVBC

EVBC is an underground mine and the main mining methods are overhand cut and fill and transverse and longitudinal longhole stoping. The cut and fill mining method is utilised in the oxides and some transitional areas of the Boinas mine. Longhole stoping is used in the more competent skarns.

The portfolio contribution from the EVBC royalty increased by 5% to $3.0m in the year (2020: $3.0m), despite operational performance at the mine being at the lower end of Orvana’s revised guidance. The lower production volumes in the year reflect a 10% reduction in head grade; as in previous years, Orvana had targeted higher grade ore which is usually unsustainable over a longer period. Production was also impacted by a plant stoppage in Q3 2021 for maintenance work to the tailings pumping circuit. As a result of the lower production volumes, total gold sales for the year reduced by 11% to 46.0koz (2020: 51.5koz) and copper reduced by 8% to 6.21Mlbs (2020: 6.76Mlbs).The increase in the underlying gold and copper price during the year, however, compensated for the lower volumes resulting in record revenue from the royalty.

Taking into account the $3.2m received in 2021, the Group has received $30m from this royalty since it was acquired for C$7.5m in March 2008 and with at least five years of mine life remaining and the potential for expansion on top of that, it is a very good example of how the royalty model can work well through evolving resource and exploration expansion, common at many mines.