Royalties receives Bilbao economic update from SLR

Executive Summary

• Royalties Inc. received an economic update on the Bilbao project from SLR Consulting (Canada) Ltd., which updated the 2014 Preliminary Economic Assessment (PEA) to a December 2025 cost basis using current metal prices.
• The sensitivity analysis indicates the project is highly sensitive to silver prices, with significant upside potential given the current market environment and recent silver price breakouts.
• SLR recommends a comprehensive PEA update to validate project costs, as increases in certain commodity prices (e.g., structural steel) have exceeded the escalation factors applied in the model.

Key Details

• Source: SLR Consulting (Canada) Ltd.
• Basis of Update: The 2014 PEA model inputs were brought forward to a December 2025 cost basis, incorporating current metal prices and a sensitivity analysis for silver at various price points.
• Comparison: The update includes a comparison with the original 2014 PEA economics.
• Sensitivity Findings: The Bilbao project is very sensitive to silver prices; the breakout in silver prices has significantly improved the potential economics of the core deposit.
• Cost Concerns: While the model includes increased capital and operating costs derived from the escalation of 2014 PEA costs, increases in prices for certain commodities (specifically structural steel) have exceeded the escalation factors applied in the model update.
• Recommendations: SLR recommends that project costs be validated in a comprehensive PEA update, including assessing the impact of changed economic inputs on mineral resource estimates and potentially minable quantities used in the PEA production schedule.
• Cautionary Notes: The sensitivity analysis is based in part on inferred mineral resources, which are speculative and not categorized as mineral reserves. There is no certainty that economic forecasts will be realized. The 2014 PEA production schedule has not been adjusted for changes to cut-off grade resulting from updated economic inputs.
• Technical Basis: Referenced 2014 National Instrument 43-101 report titled "Preliminary Economic Assessment of the Bilbao Silver-Lead-Zinc Project, 720,000 Tonnes per Year Processing Plant," dated April 28, 2014.

Notable Quotes

• "As expected, the breakout in the silver price has significantly improved the potential economics of the core deposit in the Bilbao project, which can be further enhanced with a planned drill program to increase the resource. This update confirms and totally restates the value and the optionality of Bilbao in this new era of silver prices, which, after a period of short-term volatility, is expected to rise," stated Tim Gallagher, chief executive officer.