The restructured royalty provides for a flat 2% net smelter return royalty after payment of an adjusted legacy rate on the first 10,000oz gold sold per annum. The previous royalty entailed a 1.75% NSR plus a 50% participation payment on the difference between the realised gold price and A$1340/oz.

The current gold price is $2147/oz.

The restructured royalty will kick in after the first 10,000oz has been delivered under the legacy NSR agreement plus a reduced 27.5% participation payment for 11 years from taking effect on January 1.

"This revised structure addresses in a meaningful way RNC's strategic objective for additional economic incentive to mine the gold resources on these tenements," Huet said.

"The new royalty will allow us to develop these tenements, thereby providing us with additional flexibility to fill our Higginsville mill with material from our extensive pipeline of openpits already identified."

RNC acquired the Higginsville operation from Westgold Resources earlier this year. Drilling and mining activities are expected to start immediately in specific areas.

The acquisition of the mine and its modern, low cost 1.3Mtpa gold mill will provide a key piece of RNC's strategy to unlock the significant potential of its flagship Beta Hunt gold mine.

The Higginsville mill will significantly reduce milling cost for Beta Hunt (RNC expects processing cost savings in excess of C$15/t, a 35% reduction). Higginville came with a a 367,000oz historical reserve within a 1.2Moz historical measured and indicated resource, along with a further 700,000oz inferred.

The mineralisation is on a 386sq.km land position in the Kalgoorlie gold region. RNC has previously successfully tolled Beta Hunt material through the Higginsville mill in 2018, achieving 94% gold recovery.

The company recently reported a significant increase in gold output and hinted that December was also off to a good start. RNC said it was likely to exceed its 2019 second half guidance of 42,000-49,000oz, which is bullish for the stock.

RNC shares gained as much as 14% in Toronto and closed 9.9% higher at 50c, valuing the company at $303 million.