Denver-based Royal Gold Inc. agreed to pay $60 million for payable gold and silver produced from the Tulsequah Chief project, which is owned by Chieftain Metals Inc.

Royal Gold said late Thursday it agreed to acquire 12.5 percent of the payable gold and 22.5 percent of the payable silver from the mine, which is in northwestern British Columbia, near Juneau, Alaska.

The company also agreed that when production is reached it will make cash payments equal to $450 per payable ounce of gold until 48,000 ounces have been delivered, and $500 per ounce thereafter. It also agreed to pay $5 per payable ounce of silver until 2.78 million ounces have been delivered and $7.50 per ounce thereafter or the prevailing market price of the metals.

Once 48,000 ounces of payable gold and 2.78 million ounces of payable silver have been delivered, the interests will convert to 7.5 percent and 9.75 percent of the payable gold and silver, respectively, for the remainder of the mine's life.