The Margaritas gold project is located in the Anza mining district, approximately 50 kilometers west of Medellin. Margaritas was initially acquired as an application for title through the Company’s purchase of Northern Colombia Holdings Limited, an affiliate of AngloGold Ashanti Limited. The Margaritas project, together with the neighboring Guintär and Niverengo project areas, are subject to a strategic alliance agreement between the Royal Road and Mineros S.A. Under the terms of the agreement, Mineros currently own a 25% interest in the Guintär-Niverengo and Margaritas project areas and may acquire a further 25%, up to a total 50% interest by providing a further $1.5 million USD of exploration funding. Royal Road Minerals is the operating partner in the strategic alliance.

Among other requirements, the process of acquiring a mining concession contract in Colombia requires Royal Road to present a Social Management Plan, and the Antioquia Secretary of Mines to complete a concertation seeking the approval of local authorities, followed by a public hearing with local communities. The Public Hearing for the Margaritas Concession Contract (SGL-09001), was conducted on May 27, 2021 and the concession contract was granted on August 27, 2021. Mining concession contracts have an initial term of 30-years, extendable for an additional 30 years.

From 2012 to 2017, AngloGold Ashanti completed geological mapping, reconnaissance rock-chip sampling, ridge and spur soil sampling and an airborne magnetic and radiometric survey over the Margaritas area. Royal Road has conducted grid-based surface geochemical sampling and further geological mapping at Margaritas, as indicated in the below figure. The company now considers the project “drill-ready”, subject to the fulfilment of the Social Management Plan, environmental baseline studies and the receipt of all necessary permissions.

Royal Road has conducted grid-based surface geochemical sampling and further geological mapping at Margaritas.

Royal Road Minerals’ new Investor Relations Manager Maria Camila Gutierrez (photo courtesy of Royal Road Minerals)

Royal Road Minerals Limited (TSXV:RYR) has announced that it has entered into an agreement with Mineros S.A. to amend its previously announced letter of intent in relation to the company’s Guintar and Niverengo concessions and its Margaritas title application in Antioquia, Colombia. The agreement extends the deadline for entering into a definitive agreement with Mineros from January 30, 2020 to March 30, 2020.

The miner also hired Maria Camila Gutierrez as its new investor relations manager. Gutierrez studied at EAFIT in Medellín, and holds a master’s degree in management from Spain’s Juan Carlos III UNiversity in Madrid. She previously served in Colombia’s MinCIT (Ministry of Commerce, Industry & Tourism), Ministry of foreign relations and MinTIC (Ministry of Information & Communications Technology).

Gutierrez is a polyglot who speaks Portuguese, Italian, French & English in addition to Spanish.

Pursuant to the LOI, the parties intend to negotiate and enter into a definitive agreement as soon as practicable, but in any case before January 30, 2020. The LOI provides that the definitive agreement would contain the following basic terms:

• Mineros would pay to Royal Road the sum of $1 million USD on execution of the Definitive Agreement
• Mineros and Royal Road would agree to an initial exploration program and budget for the exploration of the GNM Project
• Mineros would fund all exploration costs up to a total of USD $2.5 million
• After spending at-least USD $1 million, Mineros would have the option to acquire 25% of the GNM Project and to transfer titles and title applications to a new special purpose company, initially to be owned as to 75% by Royal Road and as to 25% by Mineros
• After spending at least $2.5 million USD, Mineros would acquire 50% of the Project Company and the parties would operate the Project Company on a joint venture basis
• The parties would thereafter jointly fund the operations of the Project Company and the parties’ respective interests would be subject to dilution under a standard formula, provided that if any party dilutes to 30%, it would have a one-time right to contribute any funding shortfall and restore its pre-dilution ownership interest
• If a party’s interest is diluted to below 15%, such interest would convert to 1.5% net smelter royalty
• The company would be the operator of the exploration of the GNM Project for so long as it maintains not less than a 50% ownership interest in the GNM Project

“We are pleased to expand our close relationship with Mineros and to have the opportunity to replicate our successful partnership in Nicaragua” said Tim Coughlin, Royal Road’s President and CEO. “Exploration work at the GNM Project will focus primarily on drill testing the recently permitted Niverengo and Guintar projects with a view to defining an initial inferred resource in the second half of 2020. We will also be pushing to ensure the rapid conversion of the exciting Margaritas application area to a concession contract so that scout drilling may commence there as soon as possible”

Photo courtesy Royal Road Minerals