Galleon Gold

Metalla Signs Definitive Agreement to Acquire 15% Interest in NLGM Silver Stream and Option to Invest at Cost in Subsequent Stream from Silverback LTD

TORONTO, ONTARIO--(Marketwired - April 28, 2017) - Metalla Royalty & Streaming Ltd. ("Metalla" or the "Company") (CSE:MTA)(CSE:MTA.CN)(CNSX:MTA)(OTCQB:EXCFF)(FRANKFURT:X9CP) is pleased to announce that Metalla SEZC (the Company's 100% owned Cayman subsidiary) has signed a definitive agreement to acquire 15% of the issued shares of Silverback LTD ("Silverback"), together with an option on a second stream for a net amount US$1.86 million. The first payment from Silverback will be credited against the purchase price. (as discussed below).

Silverback is a privately held Guernsey-based investment company that solely owns 100% of the New Luika Gold Mine ("NLGM") silver stream which it purchased to provide Shanta Gold Limited ("Shanta"), the operator, with construction financing for the underground mine transition. The NLGM underground mine has made significant progress over the last 12 months successfully producing its first underground gold in December 2016. During this period NLGM's reserve base was significantly increased through targeted exploration extending the operation's mine life with further increases anticipated.

Closing of the transaction by Metalla SEZC and Silverback is expected to occur on or about May 11th, 2017 and is subject to conditions customary for similar transactions.


Metalla SEZC will have a 15% interest in Silverback, which is entitled to purchase silver pursuant to the Silver Streaming Agreement dated May 6, 2016 ("SSA"). Under the SSA, silver is purchased at 10% of the silver spot price (Example: US$1.80 per oz Ag payable in cash for US$18 silver spot price). The SSA relates solely to silver by-product production from the NLGM located in the Mbeya region in the Lupa Goldfield in south west Tanzania. The SSA will have minimum silver delivery obligations totaling 608,970 oz Ag over the first 6.75 years. The SSA continues through 2026 and silver deliveries will be on an annual basis for the first seven years and then on a monthly basis.

Metalla's first delivery of 8,008 ounces of silver sold at US$17.25/oz price for a total of US$138,136 from production from October 2016 through March 2017 has been credited against the initial purchase price of US$2 million. The SSA covers 100% of monthly silver production up to 11,250 ounces and 80% of the silver production thereafter. The SSA is secured against the Singida mining licenses, a development gold asset located in central Tanzania. The security amortizes over the 6.75 years of the silver deliveries and automatically subordinates should a minimum of $6 million of project finance for Singida's development.

The NLGM is a producing gold mine that contains a silver by-product that reached commercial production in 2013. NLGM does not have sufficient data to estimate a silver reserve. In Q1 2017, NLGM produced 28,750 oz Ag. The mine produced 81,873 oz Au and 121,682 oz Ag in 2015 and 87,713 oz Au and 126,572 oz Ag in 2016 with AISC of US$661 per oz Au according to its Q4 2016 production and operational update. As part of the transaction, Metalla also has an option to invest in a second streaming transaction. Any future transactions are subject to diligence and financing.


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Metalla Royalty & Streaming

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