Orogen signs exploration deal with South32 subsidiary

Mr. Paddy Nicol reports OROGEN ROYALTIES AND SOUTH32 FORM GENERATIVE BASE METALS ALLIANCE Orogen Royalties Inc. has signed a multiyear generative exploration alliance agreement with a wholly owned subsidiary of South32 Ltd. The alliance will focus on generating base metal targets in western North America. All dollar figures are expressed in United States dollars unless otherwise stated. Paddy Nicol, chief executive officer of Orogen, commented: "The alliance with South32 broadens our scope of exploration for various commodities in western North America. South32 is a global mining and metals company with extensive operating and exploration experience, and we look forward to collaborating with them. By partnering with South32 at the generative stage, Orogen is able to leverage our expertise and data to further our strategy of organic royalty generation." alliance highlights Orogen and South32 to collaborate on early stage generative exploration focused on the discovery of significant, intrusion-related base metal deposits in underexplored areas in western North America; Initial $300,000 budget for generative exploration work to be financed by South32; Prealliance land acquisition and exploration costs of approximately $181,000 incurred by Orogen to be reimbursed by South32; Projects selected within the alliance area of interest (each, a designated project) will be subject to a five-year option agreement whereby South32 can earn a 100-per-cent interest in a designated project by financing $5-million in exploration expenditures and making milestone cash payments of $2-million. Orogen will retain up to a 2-per-cent net smelter return (NSR) royalty, subject to a buydown of up to 0.5 per cent for $5-million. Orogen will operate the alliance on behalf of both parties and identify exploration targets for evaluation by the alliance's technical committee. South32 will bear all costs of the alliance, including prealliance target development and land acquisition costs. Each designated project will be subject to a five-year option agreement whereby South32 can earn a 100-per-cent interest by financing $5-million in exploration expenditures. Milestone cash payments of $2-million, which are not a condition to exercise of an option by South32, are subject to the following schedule: $50,000 on the completion of 5,000 metres of drilling on the property; $100,000 on the completion of an aggregate 10,000 metres of drilling on the property; $150,000 on the declaration of an initial mineral resource on the property; $250,000 on the completion of a prefeasibility study; $450,000 on the completion of a feasibility study; $1.0-million on a positive investment decision by the board of directors of South32 in connection with the development of a mine. If South32 exercises an option over a designated project, Orogen will retain up to a 2-per-cent NSR (net smelter return) royalty, subject to a buydown of 0.5 per cent for $5-million (in the event Orogen retains a 2-per-cent NSR royalty). Qualified person statement All technical data, as disclosed in this press release, has been verified by Laurence Pryer, PhD, PGeo, vice-president of exploration for Orogen. Dr. Pryer is a qualified person as defined under the terms of National Instrument 43-101. About Orogen Royalties Inc. Orogen Royalties is focused on organic royalty creation and royalty acquisitions on precious and base metal discoveries in western North America. The company's royalty portfolio includes the Ermitano gold and silver mine in Sonora, Mexico (2.0-per-cent NSR royalty), operated by First Majestic Silver Corp. The company is well financed with several projects actively being developed by joint venture partners. We seek Safe Harbor.