Elemental Royalty options three Serbian licences to BHP

Executive Summary

• Elemental Royalty Corp. has entered into a definitive option and earn-in agreement with a wholly owned subsidiary of BHP Group Ltd. to acquire three exploration licenses in the Bor mining district of Serbia.
• BHP can earn a 100% interest in Elemental's Serbian subsidiary, Magma Resources doo, by making cash payments and completing specific exploration work commitments over five years.
• Elemental will retain a 2% Net Smelter Return (NSR) royalty on the projects, with BHP having the option to buy back up to 0.5% of this royalty in increments.

Key Details

• Transaction Structure: Definitive option and earn-in agreement covering three exploration licenses held by Elemental's subsidiary, Magma Resources doo.
• Target Assets: Three exploration-stage projects in the Bor mining district, Serbia:
  • Lenovac North License
  • Lenovac South License
  • Durlan Istok License
• Earn-In Conditions for BHP (100% Interest):
  • Payment of $200,000 to Elemental on the six-month anniversary of the agreement.
  • Annual payments of $200,000 to Elemental on every anniversary of the agreement until the earn-in is complete.
  • Completion of $5,000,000 in cumulative exploration expenditures on the projects within five years.
• Royalty Terms:
  • Elemental retains a 2% NSR royalty on each project.
  • BHP may buy back up to 0.5% of the royalty in 0.25% increments:
    • 0.25% can be purchased for $5,000,000 before the eighth anniversary of the agreement.
    • 0.25% can be purchased for $5,000,000 before the eleventh anniversary of the agreement.
  • BHP will make annual advance royalty payments of $200,000 to Elemental until the commencement of commercial production.
• Project Context:
  • The projects are located along the geological trend of Zijin Mining’s producing Cukaru Peki copper-gold mine and the recently discovered Malka Golaja deposit.
  • Lenovac licenses cover the southern extension of the mineralization trend, where a regional fault displorses mineralization and host rocks to the southwest.
  • Durlan Istok license is located southeast of Zijin’s Majdanpek mine and east of the Coka Marin deposit.
  • Assets cover approximately 150 square kilometers of mineral rights, including prospective Upper Cretaceous andesite units and deeper Jurassic/Paleozoic host rocks.
• Investor Relations Update: Elemental retained Renmark Financial Communications Inc. for North American investor relations, with monthly fees of up to $9,000 starting January 1, 2026, for a seven-month period ending July 31, 2026, and monthly thereafter.

Notable Quotes

• None explicitly quoted in the text, though the release notes that BHP's "deep-sensing geophysical capabilities and existing regional interest make them an ideal exploration partner for the projects."