Skeena Closes C$81 Million Financing with Franco-Nevada

VANCOUVER, BC / ACCESSWIRE / December 18, 2023 / Skeena Resources Limited (TSX:SKE )(NYSE:SKE ) ("Skeena" or the "Company") has closed a financing package of C$81 million with Franco-Nevada Corporation ("Franco-Nevada") to further develop their 100% owned Eskay Creek Gold-Silver Project ("Eskay Creek") located in the Golden Triangle of Northwest British Columbia.

The C$81 million financing package consists of the sale of a 1.0% Net Smelter Return ("NSR") royalty on Eskay Creek for C$56 million and a C$25 million unsecured Convertible Debenture (the "Debenture"). With this incremental royalty purchase, Franco-Nevada now holds a 2.5% NSR on all of Skeena's Eskay Creek properties.

Walter Coles, Skeena's Executive Chairman, commented "Securing funding for the advancement of Eskay Creek to production is critical for Skeena. As a management team and shareholders ourselves, we are striving to minimize shareholder dilution in what is currently an extremely difficult capital markets environment for mine developers in Canada. To achieve this, we are pursuing less conventional financing pathways that limit the issuance of straight common equity. At US$2,000/oz gold, this 1% royalty will add about US$20 to Eskay Creek's very low All In Sustaining Cost of US$687/oz, which implies that Skeena will still maintain a very substantial profit margin."

The Debenture will carry an interest rate of 7% and mature on the earlier of December 19, 2028, or on the completion of a Board approved project financing for Eskay Creek. The Debenture will be convertible into common shares at a conversion price of C$7.70, representing a 35% conversion premium to Skeena's 5-day TSX volume weighted average price. No commissions or financing fees will be paid in respect of this financing and interest payments will be capitalized and deferred until maturity.

Foto: Accesswire

About Skeena

Skeena Resources Limited is a Canadian mining exploration and development company focused on revitalizing the Eskay Creek and Snip Projects, two past-producing mines located in Tahltan Territory in the Golden Triangle of northwest British Columbia, Canada. The Company released a Definitive Feasibility Study for Eskay Creek in November 2023 which highlights an after-tax NPV5% of C$2.0B, 43% IRR, and a 1.2-year payback at US$1,800/oz Au and US$23/oz Ag.