Royal Gold, owner of rights to gold sales from companies such as Barrick Gold, said the global credit crisis has increased the number of companies seeking assistance in funding new mining projects.
Loans for mine development have become more expensive and difficult to obtain, and slumping share prices have made equity financing less attractive, Royal Gold chief executive Tony Jensen said Monday.
Shares of mine developers that haven’t secured funding for projects have slumped. Royal Gold, like rival Franco-Nevada Corp., offers loans to mining companies in return for a percentage of future sales, profits or production.
Royal will have about $50 million in cash after completing its $150 million purchase of Barrick’s royalty portfolio. The Associated Press
