Investors can score points not only with conventional mining companies, but also with royalty companies.
Exploration and production projects need financing. This is where royalty companies come into play. In return for financing, they receive license fees and streams. Streams are an agreed quantity of precious metals or even uranium. The royalty companies often also receive shares in the mining company. The royalty companies are almost completely exempt from the mining risk, which lies with the mine operators. Although the latter must pay a portion of the revenue, the royalty companies profit from the production of the mining operations. The first royalty company was established in 1983, the Franco-Nevada Corporation, and others followed.
The portfolio of a royalty company has the advantage of diversification. This reduces the risk associated with a single mining investment. It is a phenomenal financial instrument that can create value for shareholders. And a win-win situation is created for both partners. Royalty companies usually acquire royalties for a land package. This puts the royalty company in a good position to earn a share of the profits from a mine expansion without having to do anything else. And if gold prices are high, more projects go into production. Royalties for exploration projects are not expensive, but can generate a lot of royalties later on, which is a kind of leverage.
Most of these are precious metals, and Osisko Gold Royalties - https://www.commodity-tv.com/ondemand/companies/profil/osisko-gold-royalties-ltd/ - is a good example. The company owns more than 180 royalties and precious metal offtakes in North America. More than 20 producers are involved.
Interestingly, there is also a single royalty company in the uranium sector, Uranium Royalty - https://www.commodity-tv.com/ondemand/companies/profil/uranium-royalty-corp/ -. Its portfolio includes royalties and streams in the uranium sector. Uranium Royalty is therefore unique in the royalty sector.
Current corporate information and press releases from Osisko Gold Royalties (- https://www.resource-capital.ch/en/companies/osisko-gold-royalties-ltd/ -) and Uranium Royalty (- https://www.resource-capital.ch/en/companies/uranium-royalty-corp/ -).
In accordance with §34 WpHG I would like to point out that partners, authors and employees may hold shares in the respective companies addressed and thus a possible conflict of interest exists. No guarantee for the translation into English. Only the German version of this news is valid.
Disclaimer: The information provided does not represent any form of recommendation or advice. Express reference is made to the risks in securities trading. No liability can be accepted for any damage arising from the use of this blog. I would like to point out that shares and especially warrant investments are always associated with risk. The total loss of the invested capital cannot be excluded. All information and sources are carefully researched. However, no guarantee is given for the correctness of all contents. Despite the greatest care, I expressly reserve the right to make errors, especially with regard to figures and prices. The information contained herein is taken from sources believed to be reliable, but in no way claims to be accurate or complete. Due to court decisions, the contents of linked external sites are also co-responsible (e.g. Landgericht Hamburg, in the decision of 12.05.1998 - 312 O 85/98), as long as there is no explicit dissociation from them. Despite careful control of the content, I do not assume liability for the content of linked external pages. The respective operators are exclusively responsible for their content. The disclaimer of Swiss Resource Capital AG also applies: https://www.resource-capital.ch/en/disclaimer/
Exploration and production projects need financing. This is where royalty companies come into play. In return for financing, they receive license fees and streams. Streams are an agreed quantity of precious metals or even uranium. The royalty companies often also receive shares in the mining company. The royalty companies are almost completely exempt from the mining risk, which lies with the mine operators. Although the latter must pay a portion of the revenue, the royalty companies profit from the production of the mining operations. The first royalty company was established in 1983, the Franco-Nevada Corporation, and others followed.
The portfolio of a royalty company has the advantage of diversification. This reduces the risk associated with a single mining investment. It is a phenomenal financial instrument that can create value for shareholders. And a win-win situation is created for both partners. Royalty companies usually acquire royalties for a land package. This puts the royalty company in a good position to earn a share of the profits from a mine expansion without having to do anything else. And if gold prices are high, more projects go into production. Royalties for exploration projects are not expensive, but can generate a lot of royalties later on, which is a kind of leverage.
Most of these are precious metals, and Osisko Gold Royalties - https://www.commodity-tv.com/ondemand/companies/profil/osisko-gold-royalties-ltd/ - is a good example. The company owns more than 180 royalties and precious metal offtakes in North America. More than 20 producers are involved.
Interestingly, there is also a single royalty company in the uranium sector, Uranium Royalty - https://www.commodity-tv.com/ondemand/companies/profil/uranium-royalty-corp/ -. Its portfolio includes royalties and streams in the uranium sector. Uranium Royalty is therefore unique in the royalty sector.
Current corporate information and press releases from Osisko Gold Royalties (- https://www.resource-capital.ch/en/companies/osisko-gold-royalties-ltd/ -) and Uranium Royalty (- https://www.resource-capital.ch/en/companies/uranium-royalty-corp/ -).
In accordance with §34 WpHG I would like to point out that partners, authors and employees may hold shares in the respective companies addressed and thus a possible conflict of interest exists. No guarantee for the translation into English. Only the German version of this news is valid.
Disclaimer: The information provided does not represent any form of recommendation or advice. Express reference is made to the risks in securities trading. No liability can be accepted for any damage arising from the use of this blog. I would like to point out that shares and especially warrant investments are always associated with risk. The total loss of the invested capital cannot be excluded. All information and sources are carefully researched. However, no guarantee is given for the correctness of all contents. Despite the greatest care, I expressly reserve the right to make errors, especially with regard to figures and prices. The information contained herein is taken from sources believed to be reliable, but in no way claims to be accurate or complete. Due to court decisions, the contents of linked external sites are also co-responsible (e.g. Landgericht Hamburg, in the decision of 12.05.1998 - 312 O 85/98), as long as there is no explicit dissociation from them. Despite careful control of the content, I do not assume liability for the content of linked external pages. The respective operators are exclusively responsible for their content. The disclaimer of Swiss Resource Capital AG also applies: https://www.resource-capital.ch/en/disclaimer/
