Canadian Malartic - Barnat Pit Update

OR Royalties disclosed on July 2, 2026, that operating partner Agnico Eagle experienced a rock mass movement along the north wall of the Barnat open pit at the Canadian Malartic Complex in Québec on July 1. Mining in the Barnat pit has been temporarily suspended for geotechnical assessment, though no injuries, equipment damage, or environmental impact occurred.

Agnico Eagle estimates the incident will reduce gold production at Canadian Malartic by 60,000–80,000 ounces in H2 2026 and by up to 150,000 ounces per year in both 2027 and 2028. OR Royalties holds a 5.0% NSR on nearly all mineral reserves in the Barnat pit.

Despite the reduction, the company states its 2026 GEO delivery guidance and 5‑year outlook remain unchanged, and the long‑term pathway to 1 million ounces per year from the complex (via the Odyssey underground mine) is unaffected. Agnico is evaluating mitigation opportunities.

OR Royalties Inc. (OR) faces a material negative event with the suspension of the Barnat pit, its flagship royalty asset. The company holds a 5% net smelter return (NSR) on Barnat reserves, meaning the projected loss of 60,000–80,000 ounces of production in the second half of 2026 translates to approximately 3,000–4,000 fewer GEOs. Additionally, an annual loss of 150,000 ounces in 2027–2028 equates to roughly 7,500 GEOs per year. This reduction is notable given that the company guided for 80,000–90,000 GEOs in 2026.

Management stated that 2026 and five-year guidance remain unchanged, implying the shortfall is either absorbed within the range’s width or offset by outperformance elsewhere, such as at the Namdini and San Gabriel assets. However, the suspension introduces fresh uncertainty; if the geotechnical assessment leads to a prolonged closure or additional wall instability, the royalty stream could suffer further. The market is likely to price in increased risk for near-term cash flows from Canadian Malartic, which has been a cornerstone asset. The stock has already declined from approximately $65 in late February to approximately $45 at the time of the release.

OR Royalties is a precious-metals-focused royalty and streaming company that does not operate mines, instead receiving payments from third-party operators. Its portfolio is heavily weighted to gold and silver in Tier-1 jurisdictions, with approximately 75% of gross economic outputs (GEOs) coming from Tier-1 regions as of the FY 2025 transcript.

Key assets include: * A 5.0% NSR on the Canadian Malartic complex (including Barnat pit and Odyssey underground) * A 2.0% NSR on Namdini (Ghana) * A 1.5% NSR on San Gabriel (Peru) * A 1.44% GRR on Dalgaranga (Australia) * Royalties and streams on Windfall, Spring Valley, Hermosa, Cariboo, and others