Royal Road Minerals Announces Binding Framework Agreement for Its Exploration Projects in Narino, Colombia
Toronto, Ontario--(Newsfile Corp. - September 26, 2017) - Royal Road Minerals Limited (TSXV: RYR) ("Royal Road" or the "Company") is pleased to announce that it has entered into a binding framework agreement (the "Agreement") with Economías Sociales del Común ("Ecomún") in support of its gold and copper exploration projects in the Nariño Province in southern Colombia.
Royal Road has submitted application for in excess of 400,000 hectares of Concession Contracts covering what management believe is highly prospective geology for both gold and copper-gold mineralization in Nariño province of southern Colombia (see Figure 1). Of those applications, approximately 40% have advanced beyond the initial process of area adjustments and acquiring local municipal approvals and have been offered to the Company as 30-year Concession Contracts. The Company has accepted these applications and is advancing with the National Mining Agency (ANM) to complete the Concession Contract process.
The Agreement with Ecomún provides a binding framework for the support of Royal Road's long-term mineral exploration and development plans in Nariño Province, aligns Royal Road with the Colombian Government's post-conflict aspirations, as contemplated by the British Embassy's Business and Peace Initiative (to which Royal Road is a signatory), and demands an exemplary level of social engagement and environmental stewardship from both parties.
Ecomún is a joint social and economic organization, which was formed by Presidential Decree on May 29, 2017, with funding and other support provided by the Colombian government and with the aim of collective and individual economic and social reincorporation of the members of the Revolutionary Armed Forces of Colombia People's Army (FARC-EP), in accordance with the final peace agreement, between the Government of Colombia and the FARC-EP on November 24, 2016.
This Agreement, which is the first of its kind since the 2016 peace agreement, will require definitive documentation, and includes the following key terms:
- Social and environmental programs conducted under the Agreement will be managed by a Management Committee comprised of representatives from Royal Road, Ecomún, local communities and nominated independents.
- Community Liaison Committees will be established and will report to the Management Committee.
- The parties will collaborate to formalize currently illegal mining operations in the area of influence with a specific focus on eradicating the use of mercury and assisting operators in meeting their operational, environmental and social obligations under the law.
- Ecomún will provide Royal Road with collaboration and assistance with obtaining the social license necessary for it to carry out exploration and potential future development of mineral projects in Nariño Province.
- Ecomún will work decisively in order to obtain the support of community leaders in the area of influence.
- Ecomún will assist Royal Road in working with local ethnic and non-ethnic communities to enable it to gain the support for its operations and to implement its social and community programs;
- The activities of the parties are to be carried out in accordance with Ecomún's corporate purpose of achieving the reincorporation of members of the FARC-EP into civilian life.
- In all aspects pertaining to environmental and social risk management, Royal Road will follow performance standards that are in line with the Equator Principles.
- In exchange for Ecomún's performance of its obligations under the proposed definitive agreement, Royal Road will grant to Ecomún a net smelter royalty equal to one percent (1%) of the gold and copper produced from its mining projects in Nariño Province. This royalty is entirely for the benefit of local communities and both parties and the Management Committee will collaborate to ensure fully transparent distribution of funds.
- Additionally, Royal Road will grant a net smelter royalty (the "NSR") equal to one percent (1%) of the gold and copper produced from its mining projects in Nariño Province on a case by case basis, directly to community managed institutions.
- The royalty is non-transferable up to the point of commercial production of the projects, provided that if Ecomún or community managed institutions wish to transfer or alienate the NSR prior to such time, Ecomún or community managed institutions must offer to transfer the NSR to Royal Road's subsidiary, which will then have the exclusive right to purchase the NSR for a sum in Colombian pesos equivalent to ten million United States of America dollars (US $10,000,000) per 1% of the NSR, with proceeds destined entirely for the benefit of local communities and both parties and the Management Committee collaborating to ensure a fully transparent distribution of funds.
Dr. Timothy Coughlin, Royal Road´s President and Chief Executive Officer, stated: "Reaching an agreement on the key terms of a deal with Ecomún is a significant milestone for Royal Road and for our Nariño project. This agreement is historic in that it is the first of its kind since the peace agreement was reached. The agreed framework is an important step in allowing Royal Road to establish and maintain broad-based community and governmental support for its operations in Nariño Province, and reaffirms our commitment to generating economic benefits locally and to high standards of social and environmental performance."
He added: "We wish to thank Ecomún and the Colombian Government for their constructive engagement and for partnering with Royal Road to further its local and corporate objectives, through sensible mineral exploration and sustainable development. We are also grateful for the support the British Embassy in Bogotá has provided in terms of our entry into the Colombia market. This process marks the beginning of a new period of collaboration between Royal Road and our local neighbors."
To view an enhanced version of Figure 1, please visit:
Neither the TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.
This news release contains certain statements that constitute forward-looking information and forward-looking statements within the meaning of applicable securities laws (collectively, "forward-looking statements") including statements relating to the framework agreement and those describing the Company's future plans and the expectations of its management that a stated result or condition will occur. Such forward-looking statements involve known and unknown risks, uncertainties and other factors that may cause the actual results, performance or achievements of the Company, or developments in the Company's business or in the mineral resources industry, or with respect to the framework, to differ materially from the anticipated results, performance, achievements or developments expressed or implied by such forward-looking statements. Forward-looking statements include all disclosure regarding possible events, conditions or results of operations that is based on assumptions about, among other things, future economic conditions and courses of action, and assumptions related to government approvals, and anticipated costs and expenditures. The words "plans", "prospective", "expect", "intend", "intends to" and similar expressions identify forward looking statements, which may also include, without limitation, any statement relating to future events, conditions or circumstances. Forward-looking statements of the Company contained in this news release, which may prove to be incorrect, include, but are not limited to, those related to the framework agreement and any definitive agreement contemplated thereby, Ecomún, the Company's plans exploration plans, and the concession agreements and applications, and management's beliefs about the related geology and exploration potential of the areas covered thereby.
The Company cautions you not to place undue reliance upon any such forward-looking statements, which speak only as of the date they are made. There is no guarantee that the anticipated benefits of the framework and the Company's business plans or operations will be achieved. The risks and uncertainties that may affect forward-looking statements include, among others: economic market conditions, anticipated costs and expenditures, government approvals, and other risks detailed from time to time in the Company's filings with Canadian provincial securities regulators or other applicable regulatory authorities. Forward-looking statements included herein are based on the current plans, estimates, projections, beliefs and opinions of the Company management and, in part, on information provided to the Company by Hemco, and, except as required by law, the Company does not undertake any obligation to update forward-looking statements should assumptions related to these plans, estimates, projections, beliefs and opinions change.
For further information please contact:
Dr. Timothy Coughlin
President and Chief Executive Officer
USA-Canada toll free 1800 6389205
+44 (0)1534 887166
+44 (0)7797 742800