Re-thinking the NSR comparaison with Red Chris, I believe some changes are required to my analysis.

• Red Chris was already generating revenues since the NSR purchase.
• Red Chris will have an additional 31 years of mine life after 2028 per the PFS.
• Our 25% of SC is equivalent to a 8.3% NSR, but only after the capex is paid, therefore it would leave around 16 years of cash flows after payback.

So I took all the revenues (net of TCRC) from the Red Chris PEA and had to use a 2.3% discount rate to get a net present value close of $165M US.

When applying the same 2.3% for SC, the NPV (2.3%), for 16 years of cash flows at $88M US, starting in 10 years, gave me a NPV (2.3%) of $927M US.  Still pretty good!

From what I understand up to now, the royalty companies seem to count on increasing metal prices and exploration upside, which provides them with free additional revenues.

Per example, they would pay $927M US today for our 25%, which would repay itself after 21 years of mine life using normal inflation & reasonable LT prices.  Any improvements to the revenues (e.g. increase in metal prices, better production, lower cost, etc) and any additional mine life after 21 years, would provide them with free upside.

Since SC is only using 60% of the resource available and has A LOT of exploration potential and significant gold/silver content, it could be a great purchase for any royalty company.

Royal Gold already has a 3.5% NPI in Schaft Creek.

IMO.

MoneyK