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JV Article: Vox Royalty’s deal-sourcing unlocks world’s valuable forgotten royalties

Messina mine, Limpopo province, South Africa. Image from Google Earth.

Vox Royalty Corp. (TSX-V: VOX, OTCQX: VOXCF), which holds the second-largest mining royalty portfolio in Australia behind Franco Nevada, and has been tapped as the top company for projected revenue growth amongst its peers, has executed an agreement to acquire two world-class platinum group metals (PGM) royalties for $8.3 million (C$10.4m), expanding its portfolio of precious metals royalties.

They include a 1% royalty over the Dwaalkop project and a 0.7% gross royalty over the Messina project which collectively cover the full extent of the 36 million ounce Limpopo PGM project, operated by Sibanye-Stillwater (JSE: SSW / NYSE: SBSW).

Limpopo was last successfully mined in 2009 via the existing Baobab shaft and concentrator, which are both still in place. Since the takeover of the Limpopo project in 2019, Sibanye initiated a strategic review process, including revising and updating the 2017 feasibility study in 2020 to assess an optimal development timeframe for the assets.

Messina mine at night. Image from Google Earth.

Due to the steep dip of the UG2 and Merensky Reefs, the project remains an attractive mechanization option, which fits well with strategic goals, Sibanye has said. Sibanye’s most recent 2020 study confirmed the financial viability of a near-term restart of Limpopo.

“This project came to us through what we’ve built up as our systematic advantage in the industry – our proprietary database – our deal sourcing agents around the world connecting the dots to find these unique and valuable acquisitions,” says CEO Kyle Floyd.

“This asset was one that we had identified and had been working on for months. It was one of those forgotten royalties of the last decade. Sibanye wound up acquiring Lonmin Plc, the company that previously operated this asset and paid the royalty,” Floyd says.

Vox’s edge is the information it obtains from the intellectual property contained in its global royalty database. Over the last ten years, Vox’s management has built the world’s largest proprietary database of over 8,000 global mining royalties. Vox uses that database to find ”under the radar”mining royalty opportunities, often in the unlikely hands of telecommunications, technology, or automotive companies.

“This royalty was created in 1998 – when this project was sold by a forgotten company called SouthernEra Resources Limited,” Floyd says.“SouthernEra was acquired by Lonmin – Lonmin was acquired by Sibanye Stillwater. People just lost track of this royalty. It was forgotten until now – surfaced by Vox deal agents working throughout South Africa and globally and vetted by the technical understanding of our team of geologists and mining engineers.”

“For us, this deal was very consistent with our theme of acquiring royalties, with very deep value, anywhere from one year to five years pre-production, with a de-risked plan to get back into production,” Floyd says.

“It’s very de-risked, in that it was an already producing asset, all of the existing infrastructure is in place, with a tremendous amount of capital already put in the ground. It has a US$10 billion operator that knows how to operate these assets as well as anyone. It checked every box for us.”

The acquisition provides exposure to an 18 million ounce 4E (platinum, palladium, rhodium, gold) Measured and Indicated PGM resource and a further 18 million ounce 4E Inferred PGM resource over a past-producing mine on the prolific Bushveld Igneous Complex. When the by-product credits from the copper, nickel and other secondary metals are included this resource hosts a total gold-equivalent resource of over 50 million ounces, a generational orebody.

It significantly increases Vox’s exposure to battery metals such as rhodium, copper and nickel contained within the resource – in 2007, Lonmin plc produced 73,600 ounces of PGMs, along with 752 tonnes of nickel and 513 tonnes of copper at the Limpopo mine.

“This is highly consistent with our strategy and our systematic advantages of finding forgotten royalties and in these cases we are able to truly delineate value through our due diligence review with our technical team, and surface the best value for shareholders,” Floyd says.

 “This is a generational acquisition for our business. Being able to check all those boxes to top it off – I don’t know that there’s been a royalty acquisition in the last decade where the royalty covered 50 million gold-equivalent resource ounces, certainly not at these prices,” Floyd adds.

“It’s a stunning acquisition from that standpoint. It’s what we’ve been communicating to investors we were going to be accomplishing all along. Our ability to connect all the dots and find this type of hidden value for shareholders is really unprecedented in the sector.”

The preceding Joint-Venture Article is PROMOTED CONTENT sponsored by Vox Royalty Corp. and produced in cooperation with The Northern Miner.  Visit Vox Royalty Corp. for more information.

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