VANCOUVER, BRITISH COLUMBIA -- (Marketwire) -- 03/26/13 -- In connection with the release of its fourth quarter and annual results, Sandstorm Metals & Energy Ltd. ("Sandstorm" or the "Company") (TSX VENTURE: SND) is pleased to provide a corporate update on the activities of the Company (all figures U.S.).
Sandstorm has a portfolio of 4 commodity streams in 3 diversified commodities including the following:
Bracemac-McLeod Mine - Copper Stream
Sandstorm has a copper stream with Donner Metals Ltd. to purchase 24.5% of the copper produced from the Bracemac-McLeod Mine ("Bracemac-McLeod") at $0.80 per pound (subject to adjustment if the spot price of copper falls below $2.75 per pound, in which case the payments will decrease to $0.55 per pound). Bracemac-McLeod is operated by Xstrata Canada Corp. and the mine is expected to initiate production during the second quarter of 2013.
An ongoing 35,000 metre drill program on the McLeod Deep Zone has discovered high-grade sulphide mineralization between the proven and probable mineral reserves in the McLeod Zone (2.10 million tonnes grading 9.25% zinc, 1.18% copper, 24.98 g/t silver, 0.49 g/t gold) and inferred mineral resources in the McLeod Deep Zone (2.47 million tonnes grading 9.21% zinc, 1.22% copper, 39.81 g/t silver and 1.12 g/t gold). These new results increase the hypothesis that the two zones, separated by a 200-metre un-drilled gap, are connected by continuous high-grade sulphide mineralization, which has potential implications for additional mineral resources and extended mine life at Bracemac-McLeod.
Serra Pelada Mine - Palladium Stream
Sandstorm has a palladium stream with Colossus Minerals Inc. ("Colossus") to purchase 35% of the palladium produced from the Serra Pelada Mine ("Serra Pelada") at $100 per ounce. Serra Pelada is a high-grade gold-platinum-palladium mine that is expected to initiate gold production in the second half of 2013, with platinum and palladium production beginning at the end of 2014. Colossus is in the process of collecting a bulk sample and the material is being assayed and sorted on surface, the results of which are expected in the coming weeks. Underground drilling is ongoing and the data is being used to complete the first mineral resource/reserve estimate at Serra Pelada.
In connection with the palladium stream, the Company has made a $15 million cash payment to Sandstorm Gold Ltd.
Gordon Creek Property - Natural Gas Stream
Sandstorm has a natural gas stream with Thunderbird Energy Corp. ("Thunderbird") to purchase 35% of the natural gas produced from the Gordon Creek Property ("Gordon Creek") at $1.00 per mcf (plus 20% of the price received that is above $4.00 per mcf and less certain production taxes that have recently averaged less than 2% of revenue). In addition to continuing production from four historical wells, Thunderbird commenced production from eight new wells at Gordon Creek in late 2012. The Gordon Creek wells produce from stacked sands and coals within the Ferron zone, and it is common for these wells to require a period of dewatering. Thunderbird is in the process of optimizing pump performance to maximize water removal, and results to date, although preliminary, have been encouraging.
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