Maverix Metals has acquired a 1.5% net smelter returns royalty on the McCoy-Cove project in Nevada. It was originally intended to be included in the royalty portfolio that Maverix recently acquired from Newmont Mining, but was subject to a right of first refusal in favor of Premier Gold Mines. Premier provided notice to Newmont that it would not proceed.
McCoy-Cove is a development-stage project located along the Battle Mountain-Eureka Trend in Nevada, USA. The Cove property hosts one of the highest-grade undeveloped gold deposits in Nevada. It was mined by Echo Bay Mines Ltd. between 1987 and 2001 and produced 2.6 million ounces (oz) of gold and 100 million oz of silver. McCoy was mined between 1986 and 2001, and produced approximately 900,000 oz of gold and 3 million oz of silver.
On January 10, Premier and Barrick Gold entered into an exploration and development agreement where Barrick Gold will have an option to earn a 60% interest in the exploration portion of the McCoy-Cove property by spending $22.5 million in exploration before June 30, 2022. On May 15, Premier announced the results of a preliminary economic assessment of the Cove project that outlined an eight-year mine life producing an average of 92,400 oz per year (oz/y) of gold.
Premier has allocated a budget of $19 million toward development and exploration at the Cove project in 2018 with more than 8,000 meters of drilling planned. As of March 31, the Cove project had indicated resources of 900,000 metric tons (mt) at 11.2 grams/mt containing 342,000 oz of gold and inferred resources of 3.7 million mt at 11.2 g/mt containing 1.3 million oz of gold.