A World Class Royalty Company
RGLD Nasdaq 41.74 +1.29 +3.19% Volume: 1,038,145 February 12, 2016
RGL: TSX 57.94 +1.76 +3.13% Volume: 24,804 February 12, 2016
Current Gold Price 1237.61 -9.41 -0.75% Volume: February 12, 2016

Royalties

What is a royalty?

A royalty is the right to receive a percentage or other denomination of mineral production from a mining operation.

Most of Royal Gold’s royalties are based on production generated from a mine. For example, a 2.0% gross value royalty on a mine that produces 100,000 ounces of gold annually, would generate payments having a value of nearly 2,000 ounces of gold per year. At a gold price of $1,600 per ounce, this would result in royalty revenue to us of nearly $3.2 million per year.

Types of royalties

The Company’s portfolio contains several different kinds of royalties or similar interests which are defined as follows:

Gross Proceeds Royalty (GPR): A royalty in which payments are made on contained ounces rather than recovered ounces. 

Gross Smelter Return (GSR) Royalty: A defined percentage of the gross revenue from a resource extraction operation, less, if applicable, certain contract-defined costs paid by, or charged to, the operator.

Gross Value (GV) Royalty: A defined percentage of the gross value, revenue or proceeds from a resource extraction operation, without deductions of any kind.

Milling Royalty (MR): A royalty on ore throughput at a mill.

Net Profits Interest (NPI) Royalty: A defined percentage of the gross revenue from a resource extraction operation, after recovery of certain contract-defined pre-production costs, and after deduction of certain contract-defined mining, milling, processing, transportation, administrative, marketing and other costs.

Net Smelter Return (NSR) Royalty: A defined percentage of the gross revenue from a resource extraction operation, less a proportionate share of incidental transportation, insurance, refining and smelting costs.

Net Value Royalty (NVR): A defined percentage of the gross revenue from a resource extraction operation, less certain contract-defined costs.

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