Royal Gold to Acquire Barrick Gold's Royalty Portfolio

DENVER, July 31 /PRNewswire-FirstCall/ -- ROYAL GOLD, INC.
(Nasdaq: RGLD; TSX: RGL), the leading precious metals royalty company,
announced that it has entered into a definitive agreement to acquire a
portfolio of royalties from Barrick Gold Corporation ("Barrick") for net cash
consideration of $150 million and a restructuring of certain Royal Gold
royalty positions at Barrick's Cortez Pipeline Mining Complex ("Cortez") in
Nevada. The restructuring of these royalty positions will reduce the royalty
burden on the undeveloped Crossroads deposit at Cortez while having only a
minimal impact on Royal Gold's royalty revenue from the current production.
The Barrick portfolio consists of royalties on 77 properties, including
eight producing royalties, 20 development and evaluation stage properties, and
49 exploration projects. Over 75% of the portfolio consists of precious
metals royalties. The purchase price for the acquisition will be paid from
cash on hand.
Royalty revenue generated from the Barrick portfolio in calendar 2007 was
approximately $12 million. Revenues are expected to grow, assuming current
commodity prices, as development stage projects commence production. The
transaction is expected to be immediately accretive on all key financial
measures.
This royalty package complements Royal Gold's existing geographical
royalty positions with significant growth into Canada and Australia.
Terms of the Transaction
Currently, Royal Gold holds four gold royalty interests at Cortez,
consisting of two sliding-scale gross smelter return ("GSR") royalties
("GSR1 and GSR2"), a fixed rate GSR royalty ("GSR3") and a net value return
royalty ("NVR1"). As consideration for the acquisition, Royal Gold will pay
Barrick $150 million in cash and reduce the GSR2 royalty, ranging from 0.72%
to 9.0%, to match the current GSR1 royalty rate ranging from 0.40% to 5.0%.
Royal Gold also will eliminate its interest in the 0.71% GSR3 and the 0.39%
NVR1 royalties on the mining claims that comprise the undeveloped Crossroads
deposit. The GSR3 and NVR1 royalties which cover areas outside of the
Crossroads deposit at Cortez will not be affected by this transaction. The
Crossroads deposit will continue to be subject to Royal Gold's GSR2 royalty at
the reduced royalty rate. The transaction is expected to close on October 1,
2008.
Commenting on the transaction, Tony Jensen, President and Chief Executive
Officer, stated, "This is a unique opportunity to significantly grow our asset
base through the acquisition of a large royalty package with a primary focus
on precious metals. These new properties will not only provide immediate
royalty revenue and cash flow, but will also add significant strength to all
phases of our portfolio -- producing royalties, evaluation and development
properties, and exploration projects. We believe the restructuring of our
various royalties at Cortez will provide the catalyst needed for Barrick to
develop the Crossroads deposit, thus providing our shareholders even greater
upside from this transaction over the long-term."
Barrick is currently investing exploration and engineering resources to
advance the development of the Crossroads project. In a press release today,
Barrick stated it "is targeting the conversion of all the existing 1.1 million
ounces of the measured and indicated resources held in the Crossroads deposit
to the proven and probable reserve category at year-end. Upside potential
exists and is being tested through ongoing drilling with the expectation of
significant resource additions."
Key Assets
The royalty portfolio was assembled by Barrick and various predecessor
companies, including Placer Dome, Homestake, Lac Minerals, AurionGold, Delta
Gold and Plutonic. The key assets in the royalty package include the
following properties:
-- Mulatos -- a sliding-scale net smelter return ("NSR") royalty currently
paying 3.5% on Alamos Gold's Mulatos gold mine in Mexico. Royal Gold currently
owns an additional 0.30%-1.50% sliding-scale NSR royalty on the property.
This acquisition consolidates the Mulatos royalty and increases Royal Gold's
royalty interest from 1.5% to 5.0% at current commodity prices. The royalty
is capped at 2.0 million ounces of production and 212,000 ounces have been
produced through March 31, 2008.
Malartic -- a 2.0%-3.0% sliding-scale NSR royalty on the Canadian Malartic
gold project, owned by Osisko Mining Corporation ("Osisko"). Osisko
anticipates releasing measured and indicated additional mineralized material
estimates on Malartic in the third quarter of 2008 and expects to complete
feasibility work in the fourth quarter of 2008. The royalty is subject to a
buy down right and a right of first refusal.
Siguiri -- a sliding-scale NSR royalty currently paying 1.875% on the
Siguiri gold mine in Guinea, West Africa, operated by AngloGold Ashanti. The
royalty is capped on a dollar basis and approximately $15 million remains to
be paid.
Mt. Goode/Cosmos -- a 1.5% NSR royalty covering a portion of Xstrata's
Cosmos nickel mine in Australia. A large portion of the royalty ground is
located to the south of the Cosmos and Cosmos Deeps ore bodies, and includes
potential future production from identified mineralization, including the
Tapinos, Prospero and AM2 deposits.
Allan -- a 40% interest in a sliding-scale royalty on Potash Corporation
of Saskatchewan's potash mine located in Canada. The royalty is currently
paying at a rate of $1.44 per ton relative to annual production.
Other key precious metal royalty assets on evaluation and development
properties, or exploration projects include Mercator's Meekatharra project in
Western Australia, Dundee's Back River project in Canada, and the
Holt-McDermott claims on St. Andrew Goldfields' Holt-Holloway project in
Canada.
See Tables 1 and 2 for a list of producing, and evaluation and development
properties to be acquired in the transaction that contain reserves and
additional mineralization.
About Royal Gold
Royal Gold is a precious metals royalty company engaged in the acquisition
and management of precious metal royalty interests. Royal Gold is
publicly-traded on the NASDAQ Global Select Market under the symbol "RGLD,"
and on the Toronto Stock Exchange under the symbol "RGL." The Company's web
page is located at http://www.royalgold.com.
Conference Call and Webcast Information
Management will host a conference call at 12:00 a.m. Mountain Time
(2:00 p.m. Eastern time) on Thursday, July 31, 2008, to discuss the details of
the acquisition. The call can be accessed by dialing (800) 603-2779 or (706)
634-7230, access code 57356752.
The conference call will be simultaneously webcast on the Company's web
site at http://www.royalgold.com under the "Presentations" section. The
webcast will include a slide show. The replay of the webcast will be
available on the Company's web site approximately two hours after the call
ends.
Cautionary "Safe Harbor" Statement under the Private Securities Litigation
Reform Act of 1995: With the exception of historical matters, the matters
discussed in this press release are forward-looking statements that involve
risks and uncertainties that could cause actual results to differ materially
from the forward-looking statements contained herein. Such forward-looking
statements include statements regarding the transaction being immediately
accretive on all key financial measures, growth in royalty revenue as
development stage projects commence production, the scheduled closing of the
transaction, receipt of immediate royalty revenues and cash flow, addition of
significant strength to Royal Gold's royalty portfolio, the restructuring of
Royal Gold's royalties providing a catalyst to Barrick's development at the
Crossroads deposit and such development resulting in a greater upside to
shareholders, the operators' estimates of reserves and additional mineralized
material, and the price of potash per ton. Like any royalty acquisition that
contains significant assets that are not producing or not yet in development,
the royalties in the royalty portfolio planned to be acquired that are in
evaluation and development or exploration stage are subject to certain risks,
such as the ability of the operator to bring the project into production and
operate in accordance with the feasibility study and the ability of Royal Gold
to make accurate assumptions regarding valuation, timing and amount of royalty
payments. In addition, the royalties are subject to certain risks associated
with conducting business in foreign countries, including application of
foreign laws to contract and other disputes, foreign environmental laws and
enforcement and uncertain political and economic environments. Factors that
could cause actual results to differ materially from projections include,
among others, the exercise of third party buy down rights, rights of first
offer and rights of first refusal on royalties planned to be acquired,
precious metals and other commodity prices, decisions and activities of the
operators of the various properties, unanticipated grade, geological,
metallurgical, processing or other problems the operators may encounter,
changes in project parameters as plans continue to be refined, economic and
market conditions, as well as other factors described elsewhere in this press
release and in the Company's Annual Report on Form 10-K, and other filings
with the Securities and Exchange Commission. Most of these factors are beyond
the Company's ability to predict or control. The Company disclaims any
obligation to update any forward-looking statement made herein. Readers are
cautioned not to put undue reliance on forward-looking statements.

TABLE 1
BARRICK ROYALTY PORTFOLIO

RESERVES (1,2)

GOLD/SILVER

Property Location Ownership NSR Rate % Metal
Mulatos (3) Mexico Alamos Gold 0.70 - 3.50 Gold
Siguiri (4) Guinea AngloGold Ashanti 0.00 - 1.875 Gold
Balcooma Australia Kagara Zinc 1.50 Gold
Balcooma Australia Kagara Zinc 1.50 Silver
El Toqui (5) Chile Breakwater Resources 1.0 - 3.0 Gold
Meekathar (6)
(Paddy's Flat) Australia Mercator Gold AUD$10 per ounce Gold
Wharf United States Goldcorp 2.0 Gold
Holt/Holloway Canada St. Andrew Goldfields 0.00013 x Au price Gold

BASE METALS

Property Location Ownership NSR Rate % Metal
Mt. Goode Australia Xstrata 1.50 Nickel
Balcooma Australia Kagara Zinc 1.50 Copper
Balcooma Australia Kagara Zinc 1.50 Zinc
Balcooma Australia Kagara Zinc 1.50 Lead
El Toqui Chile Breakwater Resources 1.0 - 3.0 Zinc

POTASH

Property Location Ownership NSR Rate % Metal
Allan (7) Canada Potash Corporation $0.36 - $1.44 Potash
of Saskatchewan per ton

GOLD/SILVER

Property Tons Average Grade Contained Ounces
(millions) (opt) (millions)
Mulatos (3) 35.42 0.048 1.689
Siguiri (4) 122.22 0.022 2.629
Balcooma 1.12 0.016 0.018
Balcooma 1.12 1.64 1.842
El Toqui (5) 5.20 0.032 0.167
Meekathar (6)
(Paddy's Flat) 2.19 0.140 0.308
Wharf 8.95 0.025 0.220
Holt/Holloway 2.95 0.165 0.486

BASE METALS

Property Tons Average Grade Contained lbs
(millions) (%) (millions)
Mt. Goode 1.31 4.45 116
Balcooma 2.18 3.1 135
Balcooma 1.12 8.3 185
Balcooma 1.12 3.3 73
El Toqui 5.20 7.3 759

POTASH

Property Tons Average Grade Contained Ounces
(millions) (opt) (millions)
Allan (7) 348.33 25.9 90

(1) Set forth below are the definitions of proven and probable reserves
used by the U.S. Securities and Exchange Commission. Some of these
royalty operators are Canadian issuers. Their definitions of
"mineral reserve," "proven mineral reserve" and "probable mineral
reserve" conform to the Canadian Institute of Mining, Metallurgy and
Petroleum definitions of these terms as of the effective date of
estimation as required by National Instrument 43-101 of the Canadian
Securities Administrators.
"Reserve" is that part of a mineral deposit which could be
economically and legally extracted or produced at the time of the
reserve determination.
"Proven (Measured) Reserves" are reserves for which (a) quantity is
computed from dimensions revealed in outcrops, trenches, workings or
drill holes, and the grade is computed from the results of detailed
sampling, and (b) the sites for inspection, sampling and measurement
are spaced so closely and the geologic character is so well defined
that the size, shape, depth and mineral content of the reserves are
well established.
"Probable (Indicated) Reserves" are reserves for which the quantity
and grade are computed from information similar to that used for
proven (measured) reserves, but the sites for inspection, sampling and
measurement are farther apart or are otherwise less adequately spaced.
The degree of assurance of probable (indicated) reserves, although
lower than that for proven (measured) reserves, is high enough to
assume geological continuity between points of observation.
(2) Estimated reserves subject to the Barrick royalty portfolio interests.
Royal Gold has not been supplied with reserve information directly
from the operator. This information is derived from recent publicly-
available information from the operators of the various properties or
from various recent National Instrument 43-101 reports.
(3) The royalty is capped at 2.0 million ounces of production. As of
March 31, 2008, 212,000 ounces have been produced. NSR sliding-scale
schedule (price of gold per ounce - royalty rate): $0.00 to $299.99 -
0.70%; $300 to $324.99 - 1.05%; $325 to $349.99 - 1.4%; $350 to
$374.99 - 2.10%; $375 to $399.99 - 2.80%; $400 or higher - 3.5%.
(4) The royalty is capped on a dollar basis and approximately $15 million
remains to be paid. NSR sliding-scale schedule (price of gold per
ounce - royalty rate as of 3/31/08): <478.10 - 0.00%; $478.10 to
$546.41 - 0.625%; $546.42 to $580.57 - 0.875%; $580.58 to $614.72 -
1.125%; $614.73 to $648.87 - 1.50%; above $648.87 - 1.875%.
(5) NSR sliding-scale schedule (price of zinc per pound - royalty rate):
> $0.50 but < $0.55 - 1.0%; > = $0.55 but < $0.60 - 2.0%; > = $0.60 -
3.0%.
(6) Royalty applies on production above 50,000 ounces.
(7) The royalty applies to 40% of production. The royalty rate is $1.44
per ton for the first 600,000 tons on which the royalty is paid,
reducing to $0.72 per ton on 600,000-800,000 tons and to $0.36 per ton
above 800,000 tons. The sliding-scale is applicable when the price of
potash drops below $23 per ton. However, given the fact that North
American market prices for the remainder of 2008 are approximately
$800 per ton, the complete sliding-scale schedule is not presented
here.

TABLE 2
BARRICK ROYALTY PORTFOLIO

ADDITIONAL MINERALIZED MATERIAL (1,2,3,4)

GOLD/SILVER
Property Location Ownership NSR Rate % Metal

Mulatos (5) Mexico Alamos Gold 0.70 - 3.50 Gold
Siguiri (6) Guinea AngloGold 0.00 - 3.75 Gold
Ashanti
Meekatharra
(7,8)
(Reedy) Australia Mercator Gold 1.0 - 2.5 Gold
Meekatharra
(8)
(Paddy's
Flat) Australia Mercator Gold AUD$10 Gold
per ounce
Wharf United States Goldcorp 2.0 Gold
Malartic (7) Canada Osisko 2.0 - 3.0 Gold
Exploration
Holt/Holloway
(9) Canada St. Andrew 0.00013 x Gold
Goldfields Au price
Back River (10)
(George Lake) Canada Dundee Precious 2.35 Gold
Metals
Back River (11)
(Goose Lake) Canada Dundee Precious 1.95 Gold
Metals

Measured Indicated Inferred
Average Average Average
Tons Grade Tons Grade Tons Grade
Property (M) (opt) (M) (opt) (M) (opt)

Mulatos (5) 12.31 0.029 58.47 0.027 70.79 0.027
Siguiri (6) 1.10 0.021 20.70 0.027 63.60 0.027
Meekatharra
(7,8)
(Reedy) - - 2.25 0.071 2.65 0.069
Meekatharra
(8)
(Paddy's
Flat) - - 17.51 0.039 8.74 0.040
Wharf 3.42 0.020 5.26 0.021 4.42 0.025
Malartic (7,9) - - - - 236.61 0.027
Holt/Holloway
(10) 1.46 0.194 2.11 0.200 1.18 0.226
Back River (11)
(George Lake) - - 2.03 0.291 2.82 0.307
Back River (12)
(Goose Lake) - - 1.74 0.346 1.09 0.270

TABLE 2 (continued)
BARRICK ROYALTY PORTFOLIO

ADDITIONAL MINERALIZED MATERIAL 1,2,3,4

BASE METALS
Measured Indicated
Average Average
Tons Grade Tons Grade
Property Location Ownership NSR Rate % Metal (M) (%) (M) (%)

Mt. Goode Australia Xstrata 1.50 Nickel 0.46 6.39 0.56 6.98
Balcooma Australia Kagara Zinc 1.50 Copper -- -- 1.87 3.7
Balcooma Australia Kagara Zinc 1.50 Zinc -- -- 0.77 6.7
Balcooma Australia Kagara Zinc 1.50 Lead -- -- 0.77 2.8
El Toqui Chile Breakwater Measured and Indicated
(10,13) Resources 1.0 - 3.0 Zinc 5.89 tons @ 8.1%
Ming Canada Rambler C$1.00 per
Metals ton of ore Copper 0.53 -- 10.56 --
(14) (14)
Kutcho Canada Sherwood
Creek Copper 1.60 Copper -- -- 19.05 1.56
Kutcho Canada Sherwood
Creek Copper 1.60 Zinc -- -- 19.05 2.12

Inferred
Average
Tons Grade
Property Location Ownership (M) (%)

Mt. Goode Australia Xstrata 0.65 5.65
Balcooma Australia Kagara Zinc -- --
Balcooma Australia Kagara Zinc 0.01 7.8
Balcooma Australia Kagara Zinc 0.01 3.6
El Toqui Chile Breakwater
(10,13) Resources 5.25 7.1
Ming Canada Rambler
Metals 3.39 -- (14)
Kutcho Canada Sherwood
Creek Copper 0.40 1.620
Kutcho Canada Sherwood
Creek Copper 0.40 1.770

(1) Mineralized material is that part of a mineral system that has
potential economic significance but cannot be included in the proven
and probable ore reserve estimates until further drilling and
metallurgical work is completed, and until other economic and
technical feasibility factors based upon such work have been resolved.
The U.S. Securities and Exchange Commission does not recognize this
term. Investors are cautioned not to assume that any part or all of
the mineral deposits in these categories will ever be converted into
reserves.
(2) Some of the royalty operators are Canadian issuers. Their definitions
of "mineral resource," "measured mineral resource," "indicated mineral
resource" and "inferred mineral resource" conforms to the Canadian
Institute of Mining, Metallurgy and Petroleum definitions of those
terms as of the effective date of estimation, as required by National
Instrument 43-101 of the Canadian Securities Administrators. Mineral
resources which are not mineral reserves do not have economic
viability. Canadian issuers use the terms "mineral resources" and its
subcategories "measured," "indicated" and "inferred" mineral
resources. While such terms are recognized and required by Canadian
regulations, the U.S. Securities and Exchange Commission does not
recognize them. Investors are cautioned not to assume that any part
or all of the mineral deposits in these categories will ever be
converted into reserves.
(3) Royal Gold has not been supplied with additional mineralized material
information directly from the operator. This information is derived
from recent publicly-available information from the operators of the
various properties or from various recent National Instrument 43-101
reports. Additional mineralized material shown in the table may
include additional mineralized material that is not subject to the
royalty interests, and/or may be subject to contractual limitations
such as production caps, monetary caps, and the extent of claim,
concession or tenement boundaries.
(4) Only additional mineralized material relating to producing,
development and evaluation stage projects are presented in this table.
No additional mineralized material for exploration stage projects
within the Barrick royalty portfolio are presented herein.
(5) NSR sliding-scale schedule (price of gold per ounce - royalty rate):
$0.00 to $299.99 - 0.70%; $300 to $324.99 - 1.05%; $325 to $439.99 -
1.40%; $350 to $374.99 - 2.10%; $375 to $399.99 - 2.80%; $400 or
higher - 3.5%.
(6) The royalty is capped on a dollar basis and approximately $15 million
remains to be paid. NSR sliding-scale schedule (price of gold per
ounce - royalty rate as of 3/31/08): <$478.10 - 0.00%; $478.10 to
$546.41 - 0.625%; $546.42 to $580.57 - 0.875%; $580.58 to $614.72 -
1.125%; $614.73 to $648.87 - 1.50%; above $648.87 - 1.875%.
(7) Subject to third party rights, such as first right of refusal and/or
buy down right.
(8) Royalty applies on production above 50,000 ounces at Paddy's Flat and
above 300,000 ounces at Reedy.
(9) NSR sliding-scale schedule (price of gold per ounce - royalty rate):
below $350 - 2.0%; $350 and above - 3.0%.
(10) Additional mineralized material does not include reserves, except at
Holt/Holloway and El Toqui where the operator includes reserves in
the Measured and Indicated category.
(11) Royalty applies on production above 800,000 ounces.
(12) Royalty applies on production above 400,000 ounces.
(13) NSR sliding-scale schedule (price of zinc per pound - royalty rate):
> $0.50 but < $0.55 - 1.0%; > = $0.55 but < $0.60 - 2.0%; > = $0.60 -
3.0%.
(14) Royalty is paid on tons processed through the mill rather than on
metal content.

SOURCE Royal Gold, Inc.

Karen Gross, Vice President and Corporate Secretary of Royal Gold, Inc.,
+1-303-573-1660