Toronto- and New York-listed Osisko Gold Royalties has entered into an agreement to acquire a 1.8% gross revenue royalty on the Dalgaranga gold project, operated by Spartan Resources, in Western Australia. In addition, Osisko will acquire a 1.35% royalty on additional regional exploration licences in proximity to Dalgaranga.

Osisko, which considers Dalgaranga one of the best gold development and production restart projects globally, will pay $44-million for the project royalty and $6-million for the exploration royalty.

“Osisko’s ability to uncover and execute accretive near-term cash flow precious metals transactions in Tier-1 mining jurisdictions is synonymous with our strategy,” commented president and CEO Jason Attew.

He said Spartan was expected to progress with a final investment decision at the project before the end of next year, while continuing to expand the high-grade resource at Dalgaranga.

“What the Spartan team has been able to accomplish in terms of resource discovery and definition at Dalgaranga over the past two years is impressive.

“We’re extremely pleased to be associated with one of Australia’s most exciting gold development and re-start opportunities, and with an asset that boasts such exciting exploration upside potential. We look forward to our partnership with the Spartan team going forward,” commented Attew.

Spartan’s Dalgaranga licences cover an area of about 509 km² in the prospective Murchison gold district. At June 30, the global mineral resource estimate at Dalgaranga consisted of 8.70-million tonnes, grading 4.98 g/t gold for 1.393-million ounces in the indicated category, in addition to 7.44-million tonnes grading 4.56 g/t gold for 1.089-million ounces in the Inferred category.

The project’s “high-grade core”, which is spread across the Never Never and Pepper deposits, consists of 3.88-million tonnes, grading 8.74 g/t gold for 1.09-million ounces in the indicated category, and 2.86-million tonnes, grading 8.52 g/t for 0.78-million ounces in the inferred category and currently contains 75% of the identified gold to date; as such, this area remains a key target for future resource expansions.

Osisko currently expects a mine life of 12-plus years at Dalgaranga.

Australia’s Foreign Investment Review Board has to approve the transaction.