Lundin Gold Executes Silver Stream Agreement with LunR Royalties — Fruta del Norte

Transaction Structure

Lundin Gold Inc. (TSX: LUG) and its subsidiary Aurelian Resources Inc. executed definitive agreements on April 2, 2026 with LunR Royalties Corp. for a life-of-mine silver stream on the Fruta del Norte gold mine in Ecuador.

Parameter	Detail
Stream asset	Life-of-mine silver production, Fruta del Norte
Consideration	50,505,051 LunR common shares
Distribution	Lundin Gold to distribute LunR shares to LUG shareholders as dividend in kind
Post-distribution ownership	Lundin Gold retains no ownership in LunR
Expected closing	Q2 2026
Approvals required	TSXV, LunR shareholder vote (AGM May 21, 2026)

The terms are consistent with the binding term sheet announced February 22, 2026.

Fruta del Norte Context

Fruta del Norte is Ecuador's largest operating gold mine and one of the highest-grade gold deposits in the world:

Mine Parameter	Value
Location	Zamora-Chinchipe province, southeastern Ecuador
Operator	Lundin Gold Inc.
Mineral	Gold (primary), Silver (by-product)
Proven & Probable Reserves	~4.8 Moz Au
Annual production	~350,000-400,000 oz Au
Mine life	Through ~2034+
Processing	Underground, carbon-in-leach

The silver stream carve-out allows Lundin Gold to monetize its silver by-product without diluting its gold equity story, while creating a dedicated vehicle (LunR) for investors seeking precious metals royalty/streaming exposure.

Strategic Rationale

For Lundin Gold

• Simplifies the equity story — LUG becomes a pure gold play without silver by-product complexity
• Returns value to shareholders — the dividend-in-kind distribution directly transfers LunR equity to existing LUG holders
• No cash consideration — the all-share structure avoids dilution and preserves Lundin Gold's balance sheet

For LunR Royalties

• Cornerstone asset — a life-of-mine silver stream on a Tier-1 gold mine provides LunR with a high-quality foundation asset
• Growth platform — LunR can use its equity currency and Fruta del Norte cash flows to acquire additional streaming/royalty interests
• Lundin Group ecosystem — access to deal flow and expertise within the broader Lundin family of companies

Ecuador Mining Sector Signal

The transaction is notable for Ecuador's mining sector positioning:

• Demonstrates sophisticated financial structuring is possible for Ecuador-based assets — streaming deals are common in Canada, Australia, and Peru but rare for Ecuadorian mines
• Investor confidence signal — executing a life-of-mine stream implies both parties have high confidence in Fruta del Norte's operational continuity and Ecuador's regulatory stability
• Precedent for future deals — other Ecuadorian mining projects (Cascabel, Loma Larga, El Domo) could use similar streaming structures as they advance toward production

What to Watch

• LunR shareholder vote — AGM scheduled May 21, 2026; approval is expected but not guaranteed given the all-share consideration structure
• TSXV listing requirements — LunR must meet exchange listing standards; any delays would push the closing timeline
• Silver price sensitivity — LunR's valuation will be directly correlated to silver prices; current ~$30/oz supports attractive economics
• Fruta del Norte mine life extension — any reserve additions would increase the silver stream's net present value
• Ecuador royalty framework — the mining reform law's revised royalty provisions could affect Fruta del Norte's economics and, by extension, the stream's value

Sources: Lundin Gold Inc., LunR Royalties Corp., Newswire