UNITED STATES
SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

Form 10-K/A
Amendment No. 2

(Mark One)
 

þ		ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the Fiscal Year Ended June 30, 2008

or

o		TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d)OF THE SECURITIES EXCHANGE ACT OF 1934

For the Transition Period From            to

Commission File Number 001-13357

Royal Gold, Inc.

(Exact Name of Registrant as Specified in Its Charter) 

Delaware		84-0835164
(State or Other Jurisdiction		(I.R.S. Employer
of Incorporation or Organization)		Identification No.)
1660 Wynkoop Street, Suite 1000
Denver, Colorado		80202
(Address of Principal Executive Offices)		(Zip Code)

Title of Each Class		Name of Each Exchange on Which Registered
Common stock, $0.01 par value		NASDAQ Global Select Market

Securities registered pursuant to Section 12(g) of the Act:
None

Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act. Yes   o  No   þ

Indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or Section 15(d) of the Exchange Act.  Yes   o   No   þ

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15 (d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.   Yes   þ   No   o

Indicate by check mark if disclosure of delinquent filers pursuant to Item 405 of Regulation S-K is not contained herein, and will not be contained, to the best of registrant’s knowledge, in definitive proxy or information statements incorporated by reference in Part III of this Form 10-K or any amendment to this Form 10-K.    o

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See the definitions of “large accelerated filer,” “accelerated filer” and “smaller reporting company” in Rule 12b-2 of the Exchange Act. (Check one):

Large accelerated filer þ		Accelerated filer o		Non-accelerated filer   o (Do not check if a smaller reporting company)		Smaller reporting company o

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).   Yes   o   No   þ

Aggregate market value of the voting stock held by non-affiliates of the registrant, based upon the closing sale price of Royal Gold on December 31, 2007, as reported on the NASDAQ Global Select Market was $811.7 million. As of October 31, 2008, there were 33,926,495 shares of the registrant’s common stock, $0.01 par value, issued and outstanding.

DOCUMENTS INCORPORATED BY REFERENCE

Portions of the Proxy Statement for the 2008 Annual Meeting of Stockholders scheduled to be held on November 5, 2008, filed with the Securities and Exchange Commission on September 23, 2008, are incorporated by reference into Part III, Items 10, 11, 12, 13 and 14 of this Annual Report on Form 10-K.

 

 

Explanatory Note

Royal Gold, Inc. (the “Company”, “we”, “us” or “our”) is filing this Amendment No. 2 on Form 10-K/A (this “Second Amended Form 10-K”) to amend its annual report on Form 10-K for the fiscal year ended June 30, 2008, filed with the Securities and Exchange Commission (“SEC”) on August 20, 2008 , as amended by Amendment No. 1 on Form 10-K/A filed with the SEC on August 22, 2008 (the “Original Form 10-K”).

This Second Amended Form 10-K is being filed to amend and restate the Company’s previously issued consolidated financial statements as of and for the fiscal year ended June 30, 2008 and for each of the quarters comprising the fiscal year. This amendment and restatement is required to adjust the consolidated financial statements for the fiscal year ended June 30, 2008 because of an overpayment, principally during our fiscal year 2008, of $3.1 million in royalties by the operator of the Cortez project, which was not identified by the operator or by our procedures and controls existing when the overpayments were received and recognized as royalty revenue by the Company. The effect of the restatement is to reduce royalty revenues by $3.1 million and net income by $2.1 million for the fiscal year ended June 30, 2008. The royalty overpayment and restatement is discussed in more detail in Management’s Discussion and Analysis of Consolidated Financial Position and Results of Operations and in Note 20 of the notes to the consolidated financial statements.

For the convenience of the reader, this Second Amendment restates the Original Form 10-K in its entirety. This Second Amended Form 10-K amends and the following items included in the Original Form 10-K:

	•		Part I – Item 1 – Business;
	•		Part I – Item 1A – Risk Factors;
	•		Part II – Item 6 – Selected Financial Data;
	•		Part II – Item 7 – Management’s Discussion and Analysis of Financial Condition and Results of Operations;
	•		Part II – Item 7A – Quantitative and Qualitative Disclosure About Market Risk;
	•		Part II – Item 8 – Financial Statements and Supplementary Data;
	•		Part II – Item 9A – Controls and Procedures;
	•		Part III (to indicate that information is incorporated by reference from the Company’s proxy statement for its 2008 Annual Meeting of Stockholders filed on September 23, 2008); and
	•		Part IV – Item 15 – Exhibits and Financial Statement Schedules.

Aside from the foregoing items, no other items are amended or modified in this Second Amended Form 10-K.

Other than the restatement, this Second Amended Form 10-K does not reflect events occurring after the date of the Original Form 10-K or modify or update those disclosures as affected by subsequent events. Such events include, among others, the events described in the Company’s quarterly reports on Form 10-Q and current reports on Form 8-K. This Second Amended Form 10-K should be read in conjunction with our other reports filed with the SEC subsequent to June 30, 2008 pursuant to the Securities Exchange Act of 1934, as amended.

INDEX

		PAGE
PART I.
ITEM 1. Business			1
ITEM 1A. Risk Factors			7
ITEM 1B. Unresolved Staff Comments			16
ITEM 2. Properties			16
ITEM 3. Legal Proceedings			34
ITEM 4. Submission of Matters to a Vote of Security Holders			34
PART II.
ITEM 5. Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities			34
ITEM 6. Selected Financial Data			36
ITEM 7. Management’s Discussion and Analysis of Consolidated Financial Condition and Results of Operations			38
ITEM 7A. Quantitative and Qualitative Disclosures About Market Risk			56
ITEM 8. Financial Statements and Supplementary Data			56
ITEM 9. Changes In and Disagreements with Accountants on Accounting and Financial Disclosure			96
ITEM 9A. Controls and Procedures			96
ITEM 9B. Other Information			98
PART III.
ITEM 10. Directors, Executive Officers and Corporate Governance			98
ITEM 11. Executive Compensation			99
ITEM 12. Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters			99
ITEM 13. Certain Relationships and Related Transactions and Director Independence			99
ITEM 14. Principal Accountant Fees and Services			99
PART IV.
ITEM 15. Exhibits and Financial Statement Schedules			100
SIGNATURES			101
EXHIBIT INDEX			102

This document (including information incorporated herein by reference) contains “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934, which involve a degree of risk and uncertainty due to various factors affecting Royal Gold, Inc. and its subsidiaries. For a discussion of some of these factors, see the discussion in Item 1A, Risk Factors, of this report. In addition, please see our note about forward-looking statements included in Item 7, Management’s Discussion and Analysis of Consolidated Financial Condition and Results of Operations (“MD&A”), of this report.

PART I

ITEM 1. BUSINESS

General

Royal Gold, Inc. (“Royal Gold”, the “Company”, “we”, “us”, or “our”), together with its subsidiaries, is engaged in the business of acquiring and managing precious metals royalties. Royalties are passive (non-operating) interests in mining projects that provide the right to revenue or production from the project after deducting specified costs, if any.

We seek to acquire existing royalties or to finance projects that are in production or near production in exchange for royalty interests. We also fund exploration on properties thought to contain precious metals and seek to obtain royalties and other carried ownership interests in such properties through the subsequent transfer of operating interests to other mining companies. Substantially all of our revenues are and will be expected to be derived from royalty interests. We do not conduct mining operations at this time. During the 2008 fiscal year, we focused on the management of our existing royalty interests, the acquisition of royalty interests through asset and corporate transactions, and the creation of royalty interests through financing and strategic exploration alliances.

As discussed in further detail throughout this report, some significant developments to our business during fiscal year 2008 were as follows:

	(1)		Our royalty revenues increased 37% to $66.3 million, compared with $48.4 million during fiscal year 2007;
	(2)		High River Gold Mines Ltd. (“High River”) commenced production at the Taparko mine, which resulted in approximately $7.4 million in additional royalty revenue to the Company during the fiscal year;
	(3)		We completed the acquisition of Battle Mountain Gold Exploration Corp. (“Battle Mountain”). As part of the acquisition, we acquired thirteen royalty interests in various stages of production, development or exploration. The acquired Battle Mountain producing royalty interests contributed approximately $2.8 million in additional royalty revenue to the Company during the fiscal year;
	(4)		In addition to the royalties acquired as part of the Battle Mountain acquisition, we acquired the following royalties during our fiscal year 2008:

	•		A 2.0% net smelter return (“NSR”) royalty on the Marigold mine, located on the Battle Mountain-Eureka trend in Nevada, and operated by Goldcorp Inc. (“Goldcorp”);
	•		A 2.0-4.0% sliding-scale NSR royalty and a 10.0% net profits interest (“NPI”) royalty on the El Chanate mine, located in Sonora, Mexico, and operated by Capital Gold, Inc. (“Capital Gold”); and

•

A 1.5% NSR royalty on gold produced from the Benso concession in the Western Region of the Republic of Ghana, West Africa, and controlled by Golden Star Resources Ltd. (“Golden Star”).

	(5)		In November 2007, we completed an offering of 1,150,000 shares of 7.25% mandatory convertible preferred stock (“Preferred Stock”), resulting in net proceeds to us of approximately $111.1 million. In March 2008, we converted all of the issued and outstanding shares of the Preferred Stock into 3,977,683 shares of our common stock in connection with the conversion of the Preferred Stock.
	(6)		We repurchased 196,986 shares of our common stock pursuant to an authorized share repurchase program for a total cost of approximately $5.5 million; and
	(7)		We increased our calendar year dividend to $0.28 per basic share, which is paid in quarterly installments throughout calendar 2008. This represents an 8% increase compared with the dividend paid during calendar year 2007.

Recent Developments

Agreement to acquire Barrick Gold Corporation royalty portfolio

On July 30, 2008, we entered into a definitive agreement to acquire a portfolio of royalties from Barrick Gold Corporation (“Barrick”) in exchange for net cash consideration of $150 million and a restructuring of certain Royal Gold royalty positions at the Cortez Pipeline Mining Complex (“Cortez”), which is operated by Barrick. The Barrick royalty portfolio consists of royalties on 77 properties, including eight producing royalties, 2 development stage royalties and 67 exploration stage royalties. Eighteen of the exploration stage projects are considered to be in an evaluation stage as these properties are engaged in the search for reserves but currently contain additional mineralized material. Over 75% of the portfolio consists of precious metals royalties. The purchase price for the acquisition will be paid from cash on hand at closing. The acquisition is subject to customary closing conditions and is expected to close on October 1, 2008. Please refer to Item 7, MD&A, within this report for a further discussion of this transaction.

Certain Defined Terms

The Company’s royalty portfolio contains several different types of royalties, which are defined as follows:

Royalty—the right to receive a percentage or other denomination of mineral production from a resource extraction operation.

Gross Smelter Return (“GSR”) Royalty—a defined percentage of the gross revenue from a resource extraction operation, less, if applicable, certain contract-defined costs paid by or charged to the operator.

Net Smelter Return (“NSR”) Royalty—a defined percentage of the gross revenue from a resource extraction operation, less a proportionate share of incidental transportation, insurance, refining and smelting costs.

Net Value Royalty (“NVR”)—a defined percentage of the gross revenue from a resource extraction operation, less certain contract-defined transportation costs, milling costs and taxes.

Net Profits Interest Royalty (“NPI”)—a defined percentage of the gross revenue from a resource extraction operation, after recovery of certain contract-defined pre-production costs, and after deduction of certain contract-defined mining, milling, processing, transportation, administrative, marketing and other costs.

Our Producing Royalty Interests

Our producing royalty interests are shown in the following table. Please see Item 2, Properties, of this report for further discussion on our principal producing royalty interests.

						Royalty
Mine		Location		Operator		(Gold unless otherwise stated)
Cortez		Nevada, USA		Barrick		GSR1: 0.40%-5.0% sliding- scale GSR GSR2(1): 0.72%-9.0% sliding- scale GSR GSR3(1): 0.71% GSR NVR1(1): 0.39% NVR
Robinson		Nevada, USA		Quadra Mining Ltd. (“Quadra”)		3.0% NSR (copper, gold, silver, molybdenum)
Taparko(2)		Burkina Faso, West Africa		High River		15% GSR (TB-GSR1) and a 0%-10% sliding-scale GSR (TB-GSR2)
Leeville Mining Complex (Leeville North and Leeville South)		Nevada, USA		Newmont Mining Corporation (“Newmont”)		1.8% NSR
SJ Claims – Goldstrike		Nevada, USA		Barrick		0.9% NSR
Troy(3)		Montana, USA		Revett Minerals, Inc. (“Revett”)		7.0% GSR (silver and copper)
Bald Mountain		Nevada, USA		Barrick		1.75%-3.5% sliding-scale NSR
Mulatos(4)		Sonora, Mexico		Alamos Gold, Inc. (“Alamos”)		0.30%-1.5% sliding-scale NSR
El Chanate(5)		Sonora, Mexico		Capital Gold		2.0%-4.0% sliding-scale NSR; 10.0% NPI
Martha		Santa Cruz Province, Argentina		Coeur d’Alene Mines Corporation (“Coeur d’Alene”)		2.0% NSR (silver)
Don Mario—Lower Mineralized Zone(6)		Chiquitos Province, Bolivia		Orvana Minerals Corp. (“Orvana”)		3.0% NSR (gold, silver and copper)
Williams(6)		Ontario, Canada		Barrick (50%) and Teck Cominco Limited (50%)		0.72% NSR
Peñasquito (oxide)(7)		Zacatecas, Mexico		Goldcorp		2.0% NSR (gold and silver)
El Limon(6)		El Limon, Nicaragua		Central Sun Mining, Inc. (“Central Sun”) (95%) and Inversiones Mineras S.A. (“Inversiones”) (5%)		3.0% NSR

Our Development Stage Royalty Interests

We also own the following royalty interests that are currently in development stage and are not yet in production. Please see Item 2, Properties, of this report for further discussion on our principal development stage royalty interests.

						Royalty
Mine		Location		Operator		(Gold unless otherwise stated)
Peñasquito (sulfide circuit)		Zacatecas, Mexico		Goldcorp		2.0% NSR (gold, silver, lead and zinc)
Dolores(1)		Chihuahua, Mexico		Minefinders Corporation, Ltd. (“Minefinders”)		1.25% NSR 2.0% NSR (gold and silver)
Taparko		Burkina Faso, West Africa		High River		2.0% GSR (TB-GSR3)
Pascua-Lama		Region III, Chile		Barrick		0.16%-1.08% sliding-scale NSR 0.22% fixed rate royalty (copper)
Gold Hill		Nevada, USA		Kinross Gold Corporation (“Kinross”) (50%), Barrick (50%)		1.0%-2.0% sliding-scale NSR
Troy		Montana, USA		Revett		6.1% GSR 2.0% GSR
Don Mario—Upper Mineralized Zone(1)		Chiquitos Province, Bolivia		Orvana		3.0% NSR
Marigold(2)		Nevada, USA		Goldcorp		2.0% NSR
Benso(3)		Republic of Ghana, West Africa		Golden Star Resources Ltd. (“Golden Star”)		1.5% NSR

Our Exploration Stage Royalty Interests

In addition, we own royalty interests in the following exploration stage projects. None of these exploration stage projects contains proven and probable reserves as of December 31, 2007. Please see Item 2, Properties, of this report for further discussion regarding recent developments at some of our exploration stage royalty interests.

Property		Location		Royalty		Owned or Controlled By
Santa Cruz Province		Santa Cruz Province, Argentina		2.0% NSR		Hidefield Gold PLC
Night Hawk Lake(1)		Ontario, Canada		2.5% NSR		Selkirk Metals Corporation (“Selkirk”) (40%), East West Resource Corporation (“East West”) (40%), Trillium North Minerals (20%)
Follansbee(2)		Ontario, Canada		2.0% NSR		Goldcorp (51%), Premier Gold (49%)
Joe Mann(1)		Quebec, Canada		1.8% to 3.6% sliding-scale NSR; and 2.0% NSR		Gold Bullion Development Corp. (“Gold Bullion”)
Taparko		Burkina Faso, West Africa		0.75% milling fee royalty (TB-MR1)		High River
Seguenega (“Sega”)(1)		Burkina Faso, West Africa		3.0% NSR		Orezone Resources Inc. (“Orezone”)
Marmato Properties(1)		Marmato District, Colombia		5.0% NSR		Mineros Nacionales S.A. (“Mineros”)
Kettukuusikko		Lapland, Finland		2.0% NSR		Taranis Resources, Inc. (“Taranis”)
Vueltas del Rio(1)		Western Honduras		2.0% NSR		Lundin Mining Corporation (“Lundin”)
Lluvia de Oro(1)		Sonora, Mexico		4.0% NSR		Columbia Metals Corporation Ltd. (“Columbia Metals”)
Nieves		Zacatecas, Mexico		2.0% NSR		Quaterra Resources Inc.
San Jeronimo		Zacatecas, Mexico		2.0% NSR		Goldcorp
Long Valley		California, USA		1.0% NSR		Vista Gold Corporation
Rock Creek(3)		Montana, USA		1.0% NSR		Revett Minerals
Mule Canyon		Nevada, USA		5.0% NSR		Newmont
Buckhorn South		Nevada, USA		16.5% NPI		Barrick
Ferris/Cooks Creek		Nevada, USA		1.5% NVR		Barrick
Horse Mountain		Nevada, USA		0.25% NVR		Barrick
Simon Creek		Nevada, USA		1.0% NSR		Barrick
Rye		Nevada, USA		0.5% NSR		Barrick
BSC		Nevada, USA		2.5% NSR		US Gold
ICBM		Nevada, USA		0.75% NSR		BH Minerals USA, Inc. (“BH Minerals”)
Long Peak		Nevada, USA		0.75% NSR		BH Minerals
Dixie Flats		Nevada, USA		0.75% NSR		BH Minerals
Relief Canyon(1)		Nevada, USA		4.0% NSR		Firstgold Incorporated (“Firstgold”)
Fletcher Junction(1)		Nevada, USA		1.25% NSR		Nevada Exploration Inc. (“Nevada Exploration”)
Hot Pot(1)		Nevada, USA		1.25% NSR		Nevada Exploration
Svetloye		Khabarovsk Region, Russia		1.0% NSR		Fortress Minerals Corporation
La India		Nicaragua		3% NSR		Central Sun Mining

Our Operational Information

Financial Information about Geographic Areas

Royal Gold’s royalty revenue and long-lived assets (royalty interests in mineral properties, net) are geographically distributed as shown in the following table. Please refer to Item 2, Properties, for further discussion on our significant royalty interests on producing mineral properties.

		Royalty												Royalty Interests in
		Revenue												Mineral Properties, net
		2008				2007				2006				2008				2007				2006
United States			79	%			97	%			98	%			18	%			25	%			69	%
Mexico			4	%			2	%			1	%			55	%			49	%			9	%
Africa(1)			11	%			—				—				12	%			16	%			22	%
Chile			—				—				—				7	%			10	%			—
Other(2)			6	%			1	%			1	%			8	%			—				—

Our financial results are discussed in Part II, Item 7, MD&A, and within our audited consolidated financial statements are included in Part II, Item 8, Financial Statements and Supplementary Data. The risks associated with the operations of our foreign royalty interests are discussed in Part 1A, Risk Factors. In fiscal 2008, we generated royalty revenues of $22.0 million and $16.6 million from Cortez and Robinson, respectively, representing 33% and 25%, respectively, of our total royalty revenue. In fiscal 2007, we generated royalty revenues of $21.5 million and $12.6 million from Cortez and Robinson, respectively, representing 44% and 26%, respectively, of our total royalty revenue.

Competition

The mining industry in general and the royalty segment in particular are intensely competitive. We compete with other royalty companies, mine operators and financial buyers in efforts to acquire existing royalties and with the lenders and investors providing debt and equity financing to operators of mineral properties in our efforts to create new royalties. Many of our competitors in the lending and mining business are larger than we are and have greater access to capital than we have. Key competitive factors in the royalty acquisition and financing business include price, structure and access to capital.

Regulation

Like all mining operations in the United States, the operators of the mines that are subject to our royalties must comply with environmental laws and regulations promulgated by federal, state and local governments including, but not limited to, the National Environmental Policy Act; the Comprehensive Environmental Response, Compensation and Liability Act; the Clean Air Act; the Clean Water Act; the Hazardous Materials Transportation Act; and the Toxic Substances Control Act. Mines located on public lands are subject to the General Mining Law of 1872 and are subject to comprehensive regulation by either the United States Bureau of Land Management (an agency of the United States Department of the Interior) or the United States Forest Service (an agency of the United States Department of Agriculture). The mines also are subject to regulations of the United States Environmental Protection Agency (“EPA”), the United States Mine Safety and Health Administration and similar state and local agencies. Operators of mines that are subject to our royalties in other countries are obligated to comply with similar laws and

regulations in those jurisdictions. Although we are not responsible as a royalty owner for ensuring compliance with these regulations, failure by the operators of the mines on which we have royalties to comply with applicable laws, regulations and permits can result in injunctive action, damages and civil and criminal penalties on the operators which could reduce production from the mines and thereby reduce the royalties we receive and negatively affect our financial condition.

Corporate Information

We were incorporated under the laws of the State of Delaware on January 5, 1981. Our executive offices are located at 1660 Wynkoop Street, Suite 1000, Denver, Colorado 80202, (303) 573-1660.

Available Information

Royal Gold maintains an internet website at www.royalgold.com. Royal Gold makes available, free of charge, through the Investor Relations section of the web site, its Annual Reports on Form 10-K, Quarterly Reports on Form 10-Q, Current Reports on Form 8-K, and all amendments to those reports, as soon as reasonably practicable after such material is electronically filed with the Securities and Exchange Commission (“SEC”). Our SEC filings are available from the SEC’s Internet site at www.sec.gov which contains reports, proxy and information statements and other information regarding issuers that file electronically. These reports, proxy statements and other information may also be inspected and copied at the public reference facilities maintained by the SEC at 100 F Street, NE, Washington, D.C. 20549. Please call the SEC at 1-800-SEC-0330 for further information on the operation of the public reference facilities. Royal Gold’s charters of key committees of its Board of Directors and its Code of Business Conduct and Ethics are also available on the Company’s website. Any of the foregoing information is available in print to any stockholder who requests it by contacting Royal Gold’s Investor Relations Department at 303-573-1660.

Company Personnel

We currently have 16 employees, all of whom are located in Denver, Colorado. Our employees are not subject to a labor contract or a collective bargaining agreement. We consider our employee relations to be good.

Consulting services, relating primarily to geologic and geophysical interpretations and also relating to such metallurgical, engineering, and other technical matters as may be deemed useful in the operation of our business, are primarily provided by independent contractors.

ITEM 1A. RISK FACTORS

An investment in our common stock involves a high degree of risk. You should carefully consider the risks described below before making an investment decision. Our business, financial condition, results of operations and cash flows could be materially adversely affected by any of these risks. The market or trading price of our securities could decline due to any of these risks. In addition, please see our note about forward-looking statements included in Part II, Item 7, MD&A, of this Annual Report on Form 10-K. Please note that additional risks not presently known to us or that we currently deem immaterial may also impair our business and operations.

Risks Related to Our Business

We received a majority of our revenues in fiscal year 2008 from two properties.

In fiscal year 2008, approximately 33% and 24% of our revenues were derived from our royalties at Cortez and the Robinson mine, respectively, compared to approximately 44% and 26% in fiscal year 2007, respectively. We expect that revenue from our royalties at Cortez and Robinson will continue to be a significant, though less dominant, contributor to our revenue in future periods. Furthermore, as Cortez and other mines on which we have royalties mature, like SJ Claims, we can expect overall declines in production over the years unless operators are able to replace reserves that are mined by mine expansion or successful new exploration.  There can be no assurance that the operators of Cortez, SJ Claims or the other properties will be able to maintain or increase production or replace reserves as they are mined.

We own passive interests in mining properties, and it is difficult or impossible for us to ensure properties are operated in our best interest.

All of our current revenue is derived from royalties on properties operated by third parties. The holder of a royalty interest typically has no authority regarding development or operation of a mineral property. Therefore, we are not in control of basic decisions regarding development or operation of any of the properties in which we hold a royalty interest, and we have limited or no legal rights to influence those decisions.

Our strategy of having others operate properties in which we retain a royalty or other passive interest puts us generally at risk to the decisions of others regarding all basic operating matters, including permitting, feasibility analysis, mine design and operation, processing, plant and equipment matters and temporary or permanent suspension of operations, among others. These decisions may be motivated by the best interests of the operator rather than to maximize royalties. Although we attempt to secure contractual rights that will permit us to protect our interests, there can be no assurance that such rights will always be available or sufficient, or that our efforts will be successful in achieving timely or favorable results or in affecting the operations of the properties in which we have royalty interests in ways that would be beneficial to our stockholders.

Volatility in gold, copper and other metal prices may have an adverse impact on the value of our royalty interests and reduce our royalty revenues.

The profitability of our royalty interests and exploration properties is directly related to the market price of gold and, to a lesser degree, copper and other metal prices. The market price of each metal fluctuates widely and is affected by numerous factors beyond the control of any mining company. These factors include metal supply, industrial and jewelry fabrication and investment demand, expectations with respect to the rate of inflation, the relative strength of the U.S. dollar and other currencies, interest rates, gold sales and loans by central banks, forward sales by metal producers, global or regional political, economic or banking crises, and a number of other factors. If the market price of gold, copper or certain other metals, should drop, our royalty revenues would also drop. Our sliding-scale royalties at Cortez, Taparko and other properties amplifies this. When the gold price falls below the steps in the sliding-scale royalty, we receive a lower royalty rate on production. In addition, if gold, copper and certain other metal prices drop dramatically, we might not be able to recover our investment in royalty interests or properties. The selection of a royalty investment or of a property for exploration or development, the determination to construct a mine and place it into production, and the dedication of funds necessary to achieve such purposes are decisions that must be made long before the first revenues from production will be received. Price fluctuations between the time that decisions about exploration, development and construction are made and the commencement of production can have a material adverse effect on the economics of a mine, and can eliminate or have a material adverse impact on the value of royalty interests.

The volatility in gold prices is illustrated by the following table, which sets forth, for the periods indicated (calendar year), the high and low prices in U.S. dollars per ounce of gold, based on the London P.M. fix.

Gold Price Per Ounce ($)

Year		High				Low
1999			326				253
2000			312				263
2001			293				256
2002			349				278
2003			416				320
2004			454				375
2005			537				411
2006			725				525
2007			841				608
2008 (through August 13, 2008)			1,011				818

The volatility in silver prices is illustrated by the following table which sets forth, for the periods indicated (calendar year), the high and low prices in U.S. dollars per ounce of silver, based on the London P.M. fix.

Silver Price Per Ounce ($)

Year		High				Low
1999			5.75				4.88
2000			5.45				4.57
2001			4.82				4.07
2002			5.10				4.24
2003			5.97				4.37
2004			8.29				5.50
2005			9.23				6.39
2006			14.94				8.83
2007			15.82				11.67
2008 (through August 13, 2008)			20.92				14.45

The volatility in copper prices is illustrated by the following table, which sets forth, for the periods indicated (calendar year), the high and low prices in U.S. dollars per pound of copper, based on the London Metal Exchange cash settlement price for copper Grade A.

Copper Price Per Pound ($)

Year		High				Low
1999			0.80				0.63
2000			0.89				0.76
2001			0.81				0.62
2002			0.75				0.67
2003			1.00				0.72
2004			1.43				1.10
2005			2.08				1.44
2006			3.65				2.15
2007			3.77				2.37
2008 (through August 13, 2008)			4.08				3.02

We depend on the services of our President and Chief Executive Officer, our Executive Chairman and other key employees.

We believe that our success depends on the continued service of our key executive management personnel. Currently, Tony Jensen is serving as President and Chief Executive Officer and Stanley Dempsey is serving as our Executive Chairman. Mr. Jensen’s extensive commercial experience, mine operations background and industry contacts gives us an important competitive advantage. Mr. Dempsey’s knowledge of the royalty business and long term standing relationship with the mining industry are important to the Company’s success. Loss of the services of Mr. Jensen, Mr. Dempsey or other key employees could jeopardize our ability to maintain our competitive position in the industry. We currently do not have key person life insurance for any of our officers or directors.

Our revenues are subject to operational and other risks faced by operators of our mining properties.

Although we are not required to pay capital costs or most operating costs, our financial results are subject to hazards and risks normally associated with developing and operating mining properties, both for the properties where we conduct exploration or indirectly for properties operated by others where we hold royalty interests. These risks include:

	•		insufficient ore reserves;
	•		fluctuations in production costs by the operators or third parties that may make mining of ore uneconomical or impact the amount of reserves;
	•		declines in the price of gold and other metal prices;
	•		significant environmental and other regulatory restrictions;
	•		labor disputes;
	•		geological problems;
	•		pit walls or tailings dam failures;
	•		natural catastrophes such as floods or earthquakes; and
	•		the risk of injury to persons, property or the environment.

Operating cost increases can have a negative effect on the value of and income from our royalty interests, by potentially causing an operator to curtail, delay or close operations at a mine site.

In addition, the mining operator’s calculation of our royalty payments is subject to and dependent upon the adequacy of their production and accounting functions, and errors may occur from time to time in the calculations of the operator. For example, the complex nature of mining and ownership of mining interests can result in errors regarding allocation of production, such as those that occurred in connection with our restatement of our consolidated financial statements for fiscal year 2008. We are provided with production information by the mining operator in certain royalty contracts that may enable us to detect errors in the royalty payments that we receive from certain royalty interests given our royalty monitoring program and its associated internal controls and procedures. We do not, however, receive production information for all royalty interests. As a result, our ability to detect royalty payment errors is limited and the possibility exists that we will need to make retroactive royalty revenue adjustments. Further, in some royalty contracts we have the right to audit the operational calculations and production data for the associated royalty payments and, when exercised, such audits may occur many months following our recognition of the royalty revenue. In addition, certain royalty agreements, such as Robinson, provide that royalty payments to us are subject to subsequent adjustment based on commodity prices at a later date, 3-4 months in the case of Robinson, which can result in adjustments to our royalty revenue in later periods. Hence, these royalty audits may result in the recognition by us of retroactive changes in previously disclosed royalty revenues.

Estimates of reserves and mineralization by the operators of mines in which we have royalty interests are subject to significant revision.

There are numerous uncertainties inherent in estimating proven and probable reserves and mineralization, including many factors beyond our control or the control of the operators of mineral properties in which we have a royalty interest. Reserve estimates on our royalty interests are prepared by the operators of the mining properties. We do not participate in the preparation or verification of such reports and have not independently assessed or verified the accuracy of such information. The estimation of reserves and of other mineralization is a subjective process and the accuracy of any such estimates is a function of the quality of available data and of engineering and geological interpretation and judgment. Results of drilling, metallurgical testing and production, and the evaluation of mine plans subsequent to the date of any estimate, may cause revision of such estimates. The volume and grade of reserves recovered and rates of production may be less than anticipated. Assumptions about gold and other precious metal prices are subject to great uncertainty and such prices have fluctuated widely in the past. Declines in the market price of gold or other precious metals also may render reserves or mineralization containing relatively lower grades of ore uneconomical to exploit. Changes in operating and capital costs and other factors including short-term operating factors, such as the need for sequential development of ore bodies and the processing of new or different ore grades, may materially and adversely affect reserves.

Estimates of production by the operators of mines in which we have royalty interests are subject to change and actual production may vary materially from such estimates.

Production estimates are prepared by the operators of the mining properties. There are numerous uncertainties inherent in estimating anticipated production attributable to our royalty interests, including many factors beyond our control or the control of the operators of mineral properties in which we have royalty interests. We do not participate in the preparation or verification of production estimates and have not independently assessed or verified the accuracy of such information. The estimation of anticipated production is a subjective process and the accuracy of any such estimates is a function of the quality of available data, reliability of production history, variability in grade encountered, mechanical or other problems encountered, engineering and geological interpretation and operator judgment. Rates of production may be less than anticipated. Results of drilling, metallurgical testing and production, and the evaluation of mine plans subsequent to the date of any estimate may cause actual production to vary materially from such estimates.

We may incur substantially more indebtedness that could have adverse effects on our business.

We may incur substantial indebtedness in the future in connection with financing acquisitions, strategic transactions or for other purposes. Any such acquisition could be material to us and could significantly increase the size and scope of our business. If we were to incur substantial additional indebtedness, it may make it difficult for us to satisfy our debt obligations, increase our vulnerability to general adverse economic and industry conditions, require us to dedicate a substantial portion of our cash flow from operations and proceeds of any equity issuances to payments on our indebtedness, thereby reducing the availability of cash flow to fund acquisitions and other general corporate purposes and place us at a competitive disadvantage to our competitors that have less debt or have other adverse effects on us. Furthermore, if future debt financing is not available to us when required or is not available on acceptable terms, we may be unable to grow our business, take advantage of opportunities to acquire additional royalties, or respond to competitive pressures or refinance maturing debt, any of which could have a material adverse effect on our operating results and financial condition.

We may be unable to successfully acquire additional royalty interests.

Our future success depends upon our ability to acquire royalty interests at appropriate valuations, including through corporate acquisitions, to replace depleting reserves and to diversify our royalty portfolio. We anticipate that most of our revenues will be derived from royalty interests that we acquire or

finance, rather than through exploration and development of properties. There can be no assurance that we will be able to identify and complete the acquisition of such royalty interests, or businesses that own desired royalty interests, at reasonable prices or on favorable terms. In addition, we face competition in the acquisition of royalty interests. If we are unable to successfully acquire additional royalties, the reserves on properties currently covered by our royalties will decline as existing reserves are mined. Furthermore, we may experience negative reactions from the financial markets, our collaborative partners and employees if we are unable to successfully complete acquisitions of royalty interests or businesses that own desired royalty interests. Each of these factors may adversely affect the trading price of our common stock or financial results and operations.

Acquired royalty interests may not produce anticipated royalty revenues.

The royalty interests we acquire may not produce the anticipated royalty revenues. The success of our royalty acquisitions is based on our ability to make accurate assumptions regarding the valuation and timing and amount of royalty payments, particularly acquisitions of royalties on development stage properties. If the operator does not bring the property into production and operate in accordance with feasibility studies or other plans, acquired royalty interests may not yield royalty revenues or sufficient royalty revenues to be profitable. The Taparko project, which recently began production in Burkina Faso, and the Peñasquito project, also in initial production in Mexico, represent our largest development stage royalty acquisitions to date. The principal royalty assets of Battle Mountain, which we acquired on October 24, 2007, include royalties on gold and silver production from the Dolores project in Mexico, which is under development. In addition, our Pascua-Lama royalty acquisition in Chile is in a pre-production stage. The failure of these projects to produce anticipated royalty revenues may materially and adversely affect our financial condition, results of operations and cash flows.

We may experience operational and other difficulties if we complete one or more significant acquisitions.

As part of our business model and growth strategy, we are engaged in a continual review of opportunities to acquire existing royalties, including acquiring companies that hold royalties. When we acquire a company, we may experience the need to hire additional personnel, difficulties in integrating the acquired company, increases in our general and administrative expenses and other related problems. Furthermore, as part of the acquisition of a company or a group of royalties, we may acquire operating or working interests and other assets outside of our core focus of precious metal royalties. In the event we experience these difficulties in connection with one or more acquisitions, our business or financial results may be adversely affected.

Anticipated federal legislation could decrease our royalty revenues.

In recent years, the United States Congress has considered a number of proposed major revisions to the General Mining Law of 1872 (the “General Mining Law”), which governs the creation and possession of mining claims and related activities on federal public lands in the United States. Several proposals, such as Bill H.R. 2262, introduced in the Congress in May 2007, if enacted, would impose a royalty payable to the U.S. Government on existing and future production of minerals from unpatented mining claims in the United States. If enacted, the legislation such as H.R. 2262 could, among other provisions, render certain federal lands unavailable for the location of unpatented mining claims, afford greater public involvement in the mine permitting process, provide for citizen suits against miners operating on federal lands, and impose new and stringent environmental operating standards as well as new mined land reclamation requirements. If enacted, such legislation could adversely affect the development of new mines and the expansion of existing mines, as well as increase the cost of all mining operations on federal lands, perhaps materially and adversely affecting mine operators and therefore our royalty revenue.

The effect of any revision of the General Mining Law on our royalty interests in the United States cannot be determined conclusively until such revision, if any, is enacted and challenges to the legislation, if any, have been finally resolved. In addition, a number of the properties on which we have royalties are located

on U.S. federal lands that are subject to federal mining and other public land laws. Changes in such laws or regulations promulgated under such laws could affect mine development and expansion and significantly increase regulatory obligations and compliance costs with respect to mine development and mine operations, which could adversely affect our royalty revenue from such properties. By way of example, if a royalty, assessment, production tax, or other levy imposed on and measured by production is charged to the operator at Cortez, which is largely located on U.S. federal lands, the amount of that charge would be deducted from gross proceeds for calculation of our GSR1, GSR2 and GSR3 royalties, which would reduce our royalty revenues from these royalties.

The mining industry is subject to significant environmental risks.

Mining is subject to potential risks and liabilities associated with pollution of the environment and the disposal of waste products occurring as a result of mineral exploration and production. Laws and regulations in the United States and abroad intended to ensure the protection of the environment are constantly changing and generally are becoming more restrictive and costly. Insurance against environmental risks (including potential liability for pollution or other hazards as a result of the disposal of waste products occurring from exploration and production) is not generally available to the companies within the mining industry, such as the operators of the mines in which we hold a royalty interest, at a reasonable price. If an operator is forced to incur significant costs to comply with environmental regulations or becomes subject to environmental restrictions that limit its ability to continue or expand operations, it could reduce our royalty revenues. To the extent that we become subject to environmental liabilities for the time period during which we were operating properties, the satisfaction of any liabilities would reduce funds otherwise available to us and could have a material adverse effect on our financial condition, results of operations and cash flows.

If title to properties are not properly maintained by the operators, our royalty revenues may be decreased.

The validity of unpatented mining claims, which constitute a significant portion of the properties on which we hold royalties in the United States, is often uncertain and such validity is always subject to contest. Unpatented mining claims are generally considered subject to greater title risk than patented mining claims, or real property interests that are owned in fee simple. Because unpatented mining claims are self-initiated and self-maintained, they possess some unique vulnerabilities not associated with other types of property interests. It is impossible to ascertain the validity of unpatented mining claims from public real property records, and therefore it can be difficult or impossible to confirm that all of the requisite steps have been followed for location and maintenance of an unpatented mining claim. If title to unpatented mining claims included among our royalty properties has not been properly established or is not properly maintained, our royalty revenues could be adversely affected.

Foreign operations are subject to many risks.

We derived approximately 21% of our revenues from foreign sources in fiscal year 2008. Our foreign activities are subject to the risks normally associated with conducting business in foreign countries. This includes exchange controls and currency fluctuations, limitations on repatriation of earnings, foreign taxation, foreign environmental laws and enforcement, expropriation or nationalization of property, labor practices and disputes, and uncertain political and economic environments. There are also risks of war and civil disturbances, as well as other risks that could cause exploration or development difficulties or stoppages, restrict the movement of funds or result in the deprivation or loss of contract rights or the taking of property by nationalization or expropriation, without fair compensation. Exploration licenses granted by some foreign countries do not include the right to mine. Each country has discretion in determining whether to grant a license to mine. If an operator cannot secure a mining license following exploration of a property, the value of our royalty interest would be negatively affected. Foreign operations could also be adversely impacted by laws and policies of the United States affecting foreign trade, investment, and taxation. We currently have interests in projects in Argentina, Bolivia, Burkina Faso, Canada, Chile, Colombia, Finland, Ghana, Honduras, Mexico, Nicaragua and Russia. We also

evaluate precious metal royalty acquisitions or development opportunities in other parts of the world, including Canada, Central America, Europe, Australia, other Republics of the former Soviet Union, Asia, Africa and South America.

We are also subject to the risks of operating in Burkina Faso, West Africa. Countries in the region have historically experienced periods of political uncertainty, exchange rate fluctuations, balance of payments and trade difficulties and problems associated with extreme poverty and unemployment. Any of these economic or political risks could adversely affect the Taparko project.

Our operations in Mexico are subject to risks such as the effects of political developments and local unrest, and communal property issues. In the past, Mexico has experienced prolonged periods of weak economic conditions characterized by exchange rate instability, increased inflation and negative economic growth, all of which could occur again in the future. Any of these risks could adversely affect the Peñasquito and Dolores projects, as well as the Mulatos and El Chanate mines.

We hold a royalty interest in an exploration property that is subject to the risks of operating in Russia. The economy of the Russian Federation continues to display characteristics of an emerging market, including extensive currency controls and potentially high inflation. The prospects for future economic stability in the Russian Federation are largely dependent upon the effectiveness of economic measures undertaken by the government, together with legal, regulatory and political developments. Russian laws, licenses and permits have been in a state of change and new laws may be given a retroactive effect.

Our Martha royalty is subject to risks relating to operating in Argentina. Argentina, while currently economically and politically stable, has experienced political instability, currency fluctuations and changes in banking regulations in recent years. Future instability, currency value fluctuations or regulation changes could adversely affect our revenues from the Martha mine.

Our Don Mario royalty, which we acquired in the Battle Mountain transaction on October 24, 2007, is subject to risks relating to operating in Bolivia. Bolivia has experienced political and social instability, corruption, regulation and tax law changes, an abundance of administrative procedures and the potential for nationalization of foreign business interests that could materially adversely affect the Don Mario mine.

Risks Related to Our Common Stock

Our stock price may continue to be volatile and could decline.

The market price of our common stock has fluctuated and may decline in the future. The high and low sale prices of our common stock were $41.66 and $18.74 in the fiscal year ended June 30, 2006, $37.50 and $23.25 for the fiscal year ended June 30, 2007 and $35.42 and $23.85 for the fiscal year ended June 30, 2008. The fluctuation of the market price of our common stock has been affected by many factors that are beyond our control, including:

	•		market prices of gold and other metals;
	•		interest rates;
	•		expectations regarding inflation;
	•		ability of operators to produce precious metals and develop new reserves;
	•		currency values;
	•		general stock market conditions; and
	•		global and regional political and economic conditions.

Additional issuances of equity securities by us would dilute the ownership of our existing stockholders and could reduce our earnings per share.

We may issue equity in the future in connection with acquisitions, strategic transactions or for other purposes. Any such acquisition could be material to us and could significantly increase the size and scope of our business. To the extent we issue additional equity securities, the ownership of our existing stockholders could be diluted and our earnings per share could be reduced.

If a large number of shares of our common stock is sold in the public market, the sales could reduce the trading price of our common stock and impede our ability to raise future capital.

We cannot predict what effect, if any, future issuances by us of our common stock or other equity will have on the market price of our common stock. In addition, our shares of common stock that we issue in connection with an acquisition may not be subject to resale restrictions. We issued approximately 1.14 million shares of our common stock in connection with the acquisition of Battle Mountain, which closed on October 24, 2007 and 3.98 million shares in connection with the conversion of all of our issued and outstanding Preferred Stock on March 10, 2008. We may issue substantial additional shares of common stock or other securities in connection with other acquisition transactions. The market price of our common stock could decline if certain large holders of our common stock, or recipients of our common stock in connection with an acquisition, sell all or a significant portion of their shares of common stock or are perceived by the market as intending to sell these shares other than in an orderly manner. In addition, these sales could also impair our ability to raise capital through the sale of additional common stock in the capital markets.

We may change our dividend policy.

We have paid a cash dividend on our common stock for each fiscal year beginning in fiscal year 2000. Our board of directors has discretion in determining whether to declare a dividend based on a number of factors, including prevailing gold prices, economic market conditions, and funding requirements for future opportunities or operations. If our board of directors declines to declare dividends in the future, or reduces the current dividend level, our stock price could fall, and the success of an investment in our common stock would depend solely upon any future stock price appreciation in value. We have increased our dividends in prior years. There can be no assurance that we will continue to do so. For example, if we were to materially increase our borrowings to conduct a material acquisition, our board of directors could elect to modify our dividend policy and potentially reduce or eliminate dividends on common stock.

Certain anti-takeover provisions could delay or prevent a third party from acquiring us.

Provisions in our restated certificate of incorporation may make it more difficult for third parties to acquire control of us or to remove our management. Some of these provisions:

	•		permit our board of directors to issue preferred stock that has rights senior to the common stock without stockholder approval; and
	•		provide for three classes of directors serving staggered, three-year terms.

We are also subject to the business combination provisions of Delaware law that could delay, deter, or prevent a change in control. In addition, we have adopted a stockholder’s rights plan that imposes significant penalties upon a person or group that acquires 15% or more of our outstanding common stock without the approval of the board of directors. Any of these measures could prevent a third party from pursuing an acquisition of Royal Gold, even if stockholders believe the acquisition is in their best interests.

We have identified a material weakness in internal control over our financial reporting and as a result we were required to restate our financial results for the fiscal year ended June 30, 2008.

In connection with the restatement and our reassessment of our internal control over financial reporting pursuant to the rules promulgated by the SEC Section 404 of the Sarbanes-Oxley Act of 2002 and Item 308 of Regulation S-K, management has concluded that as of fiscal year ended June 30, 2008, our disclosure controls and procedures were not effective and that we had a material weakness in our internal control over financial reporting. Please refer to Item 9A of this Second Amended Form 10-K for further discussion of the ineffectiveness of and material weakness in our controls as of June 30, 2008. While we have made efforts to remediate such material weakness promptly and effectively, any additional material weaknesses or significant deficiencies could have a material adverse effect on our results of operations and financial condition, as well as impair our ability to meet our quarterly, annual, and other reporting requirements under the Securities Exchange Act of 1934, as amended, in a timely manner. These effects could in turn adversely affect the trading price of our common stock and could result in a material misstatement in consolidated financial statements and require a further restatement of our financial statements. Therefore, even if we are successful in strengthening our internal controls and procedures, such controls and procedures may not be adequate to prevent or identify existing or future internal control weaknesses. Internal control over financial reporting cannot provide absolute assurance of achieving financial reporting objectives because of its known inherent limitations (such limitations are further discussed in Item 9A of this Second Amended Form 10-K). Because of such inherent limitations, there is a risk that material misstatements in results of operations and financial condition may not be prevented or detected on a timely basis by our internal controls over financial reporting.

We may face risks related to an SEC investigation and securities litigation in connection with the restatement of our financial statements.

We are not aware that the SEC has begun any formal or informal investigation in connection with accounting errors requiring restatement of the fiscal year ended June 30, 2008. If the SEC makes a determination, however, that in its view the Company has violated Federal securities laws, then the Company may face sanctions, including, but not limited to, monetary penalties and injunctive relief, which could adversely affect our business. In addition, the Company may in the future be subject to class action suits, other litigation, or regulatory proceedings or actions arising in relation to the restatement of our consolidated financial statements for the fiscal year ended June 30, 3008. We are unable to estimate what our liability might be in connection with such potential litigation or regulatory proceeding or action and any expenses not covered by available insurance or any adverse resolution of this potential litigation or regulatory proceeding or action, which could have a material adverse effect on our business, results of operations, cash flows, or financial condition. Further, any litigation or regulatory proceeding or action may be time consuming, and it may distract our management from the conduct of our business.

ITEM 1B. UNRESOLVED STAFF COMMENTS

None.

ITEM 2. PROPERTIES

We do not operate the properties in which we have royalty interests and therefore much of the information disclosed in this Form 10-K regarding these properties is provided to us by the operators. For example, the operators of the various properties provide us information regarding metals production, estimates of mineral reserves and additional mineralized material. Reserves are summarized below in this report in Item 2, Properties—Reserve Information. Our rights to information from the operators under our royalty agreements vary by royalty and by operator and we may not be entitled to information

regarding certain properties. Furthermore, we may receive information regarding certain properties from time to time which we contractually may not be permitted to disclose. We have not independently verified any information provided by the operators.

There is more information available to the public from the operators of the properties in which we have royalties, including reports filed by Barrick, Newmont, Coeur d’Alene, Capital Gold and Goldcorp with the SEC. For risks to our business associated with operations of mining properties by third parties see generally the risks described under Part I, Item 1A, “Risk Factors.” For risks associated with the operators’ reserve estimates, please see Part I, Item 1A, “Risk Factors – Estimates of reserves and mineralization by the operators of mines in which we have royalty interests are subject to significant revision” of this Annual Report on Form 10-K for further detail.

Royalties on Producing Properties

Recent activities and further information for each of the principal producing properties in which we have a royalty interest are described in the following pages. Reserves for our producing properties are summarized in this report in Item 2, Properties—Reserve Information.

Cortez Pipeline Mining Complex (Nevada, USA)

Cortez is a large open pit, mill and heap leach operation located approximately 60 air miles southwest of Elko, Nevada, in Lander County. The site is reached by driving west from Elko on Interstate 80 approximately 46 miles, and proceeding south on State Highway 306 approximately 23 miles. Cortez includes the Pipeline, South Pipeline, Gap and Crossroads deposits and is operated by subsidiaries of Barrick.

The royalty interests we hold at the Cortez include:

	(a)		Reserve Claims (“GSR1”). This is a sliding-scale GSR royalty for all gold produced from an area originally known as the “Reserve Claims,” which includes the majority of the Pipeline and South Pipeline deposits. As defined in our royalty agreement with Cortez, our GSR royalty applies to revenues attributed to products mined and removed, with no deduction for any costs paid by or charged to Cortez, except for deductions of Mining Law reform costs. Mining Law reform costs includes all amounts paid by or charged to Cortez for any royalty, assessment, production tax or other levy imposed on and measured by production, to the extent that any such levy is hereafter imposed by the United States, in connection with reform of the General Mining Law or otherwise. As defined, no such Mining Law reform costs are currently deducted since no such reform has yet occurred. The revenues attributed to Cortez are determined on a deemed market value basis of total production for each calendar quarter outturned to Cortez’s account at the refiner. The GSR royalty rate on the Reserve Claims is tied to the gold price, without indexing for inflation or deflation as shown in the table below.
	(b)		GAS Claims (“GSR2”). This is a sliding-scale GSR royalty for all gold produced from an area outside of the Reserve Claims, originally known as the GAS Claims, which encompasses approximately 50% of the GAP deposit and all of the Crossroads deposit. The GSR royalty rate on the GAS Claims, as shown in the table below, is tied to the gold price, without indexing for inflation or deflation, and applies to revenues attributed to products mined and removed, with no deduction of costs, except for Mining Law reform costs, if any.
	(c)		Reserve and GAS Claims Fixed Royalty (“GSR3”). The GSR3 royalty is a fixed rate GSR royalty of 0.7125% for the life of the mine and covers the same cumulative area as is covered by our two sliding-scale GSR royalties, GSR1 and GSR2.
	(d)		Net Value Royalty (“NVR1”). This is a fixed 1.25% NVR on production from the GAS Claims located on a portion of Cortez that excludes the Pipeline open pit. The Company owns 31.6% of

the 1.25% NVR (or 0.39%) while our consolidated minority interest owns the remaining portion of the 1.25% NVR. This NVR1 royalty is calculated by deducting contract defined processing-related and associated capital costs, but not mining costs, from the revenue received by the operator for production from the area covered by the royalty.

We also own two other royalties at Cortez where there is currently no production attributed to the royalty interests and there is insignificant reserves attributed to the royalty interests.

The following shows the current sliding-scale GSR1 and GSR2 royalty rates under our royalty agreement with Cortez:

London PM Quarterly Average										GSR1				GSR2
Price of Gold Per Ounce ($U.S.)										Royalty Percentage				Royalty Percentage
Below						$	210.00				0.40	%			0.72	%
$210.00			—			$	229.99				0.50	%			0.90	%
$230.00			—			$	249.99				0.75	%			1.35	%
$250.00			—			$	269.99				1.30	%			2.34	%
$270.00			—			$	309.99				2.25	%			4.05	%
$310.00			—			$	329.99				2.60	%			4.68	%
$330.00			—			$	349.99				3.00	%			5.40	%
$350.00			—			$	369.99				3.40	%			6.12	%
$370.00			—			$	389.99				3.75	%			6.75	%
$390.00			—			$	409.99				4.00	%			7.20	%
$410.00			—			$	429.99				4.25	%			7.65	%
$430.00			—			$	449.99				4.50	%			8.10	%
$450.00			—			$	469.99				4.75	%			8.55	%
$470.00			—			and above					5.00	%			9.00	%

Upon the consummation of the royalty acquisition transaction between Royal Gold and Barrick, GSR2 will be reduced to match the royalty rate of GSR1 while the portion of the GSR3 and NVR1 royalties on the mining claims that comprise the undeveloped Crossroads deposit at Cortez will be eliminated. Please refer to Item 7, MD&A, of this report for a further discussion of the definitive agreement between Barrick and us.

Under certain circumstances we would be entitled to delayed production payments (i.e., payments not recoupable by Cortez) of $400,000 per year.

Barrick estimated that at a $575 gold price, proven and probable reserves related to our royalty interests at Cortez includes 44.09 million tons of ore, at an average grade of 0.044 ounces per ton, containing approximately 1.923 million ounces of gold as of December 31, 2007. In addition, Barrick has reported additional mineralized material at Cortez totaling 65.78 million tons of ore, at an average grade of 0.028 ounces of gold per ton.

The following illustration depicts the area subject to our royalty interests at Cortez:

Robinson Mine (Nevada, USA)

We own a 3.0% NSR royalty on all mineral production from the Robinson open pit mine operated by a subsidiary of Quadra. The Robinson mine produces two flotation concentrates for sale to third party smelters. One concentrate contains copper, gold and silver. The second is a molybdenum concentrate. Access to the property is via Nevada state highway 50, 6.5 miles west of Ely, Nevada, in White Pine County.

As of December 31, 2007, Quadra informed us that the copper and gold reserves were 114.41 million tons, at an average grade of 0.007 ounces per ton of gold, containing 0.772 million ounces of gold and a copper grade of 0.68% equating to 1,563 million pounds of copper. The reserves were calculated at $1.75-$2.50 per pound of copper. Quadra does not use a gold price figure to define reserves as gold is produced as a by-product of copper. Silver and molybdenum reserves were not reported but are produced and sold as a by-product.

All of the ground within the “property boundary”, as labeled in the following map, is subject to our royalty interest at the Robinson mine:

Taparko (Burkina Faso, West Africa)

In connection with a financing transaction to Somita during our third quarter of our fiscal year 2006, we own a 15.0% GSR royalty (TB-GSR1) and a sliding-scale GSR royalty (TB-GSR2), ranging from 0% to 10.0% depending on the price of gold, on all gold produced from the Taparko open pit gold mine. The Taparko mine is located in Burkina Faso, West Africa, and is operated by Somita, a subsidiary of High River. The Taparko mine is accessible by both paved and gravel roads and is approximately 125 miles northeast of Ouagadougou, the capital of Burkina Faso. Please refer to Note 3 to the consolidated financial statements for further information regarding the financing transaction.

TB-GSR1 will remain in effect until cumulative production of 804,420 ounces of gold is achieved or until cumulative payments of $35 million have been made to Royal Gold, whichever is earlier. TB-GSR2 will remain in effect until the termination of TB-GSR1. Production at the Taparko mine commenced during our first fiscal quarter of 2008. As of June 30, 2008, we have recognized royalty revenue associated with the TB-GSR1 royalty totaling $4.7 million, which is attributable to cumulative production of 36,078 ounces of gold.

We also own a perpetual 2.0% GSR royalty (TB-GSR3) on all gold produced from the Taparko mine. A portion of the TB-GSR3 royalty is associated with existing proven and probable reserves and has been classified as a development stage royalty interest. The remaining portion of the TB-GSR3 royalty, which is not currently associated with proven and probable reserves, is classified as an exploration stage royalty interest.

In addition, we own a 0.75% milling fee royalty (TB-MR1) on all gold processed through the Taparko mine processing facilities that is mined from any area outside of the Taparko mine area, subject to a maximum of 1.1 million tons per year. There currently are no proven and probable reserves associated with TB-MR1 and this royalty is classified as an exploration stage royalty interest.

Our royalties on the Taparko mine were subject to completion of our $35 million funding commitment to Somita and the royalty documents for the forgoing royalties had been signed but held pending the completion of the funding commitment. We completed the remaining $0.4 million of our funding commitment on September 27, 2007, and recorded our royalty interests.

The Taparko mine commenced gold production in August 2007 and contributed approximately $7.4 million in royalty revenue (from TB-GSR1 and TB-GSR2) for our fiscal year 2008. Reserve characteristics, mining activity, and gold recovery performance has been near feasibility study estimates. However, mill performance has suffered throughout our fiscal year 2008 due to problems associated with the grinding mill drive-train. This has resulted in low mill availability and throughput. Several problems with the original installation were identified and corrected but mechanical problems have persisted. Production was ceased on June 11, 2008, and the entire drive-train was re-evaluated and is now in the process of reassembly with the assistance of third party mill equipment specialists. Continuous and sustained production is dependent upon resolving the mill drive-train problems.

As of December 31, 2007, High River estimated that at a $800 gold price proven and probable reserves include 3.70 million tons of ore, at an average grade of 0.082 ounces per ton, containing 0.303 million ounces of gold, which reflects the $35 million cap on the TB-GSR1 royalty based on High River’s $800 gold price.

The following map depicts the area subject to our royalty interests at the Taparko mine:

Leeville Mining Complex (Nevada, USA)

We own a carried working interest, equal to a 1.8% NSR royalty, which covers the majority of the Leeville Mining Complex (collectively Leeville South and Leeville North), in Eureka County, Nevada. The Leeville Mining Complex is approximately 19 air miles northwest of Carlin, Nevada. The property is accessed by driving north from Carlin on State Highway 766 for 19 miles and then on an improved gravel road for two miles. Leeville North is a newly developed underground mine. Currently, we derive royalty revenue from underground operations on a portion of the Leeville North mine, which are operated by a subsidiary of Newmont. Production from the Leeville South mine ceased in late calendar 2007.

At the Leeville North mine, proven and probable reserves include 5.06 million tons of ore, at an average grade of 0.427 ounces per ton, containing 2.161 million ounces of gold as of December 31, 2007. In addition, Newmont has reported additional mineralized material totaling 0.64 million tons of ore, at an average grade of 0.446 ounces of gold per ton, at Leeville North as of December 31, 2007.

The following map depicts the area subject to our royalty interest at the Leeville Project:

Goldstrike — SJ Claims (Nevada, USA)

We own a 0.9% NSR royalty on the SJ Claims that covers a portion of the Betze-Post mine, in Eureka County, Nevada. Betze-Post is an open pit mine operated by a subsidiary of Barrick, at its Goldstrike property. The SJ Claims and the Betze-Post open pit lie approximately 24 air miles northwest of Carlin, Nevada. The property is accessed by driving north from Carlin on State Highway 766 for 19 miles and then on an improved gravel road for five miles.

Barrick estimated that at a $575 gold price, proven and probable reserves related to our royalty interest at the SJ Claims include 52.49 million tons of ore, at an average grade of 0.133 ounces per ton, containing approximately 6.960 million ounces of gold as of December 31, 2007. In addition, Barrick reported mineralized material of 6.82 million tons, at a grade of 0.052 ounces per ton, as of December 1, 2007.

The following map depicts the area subject to our royalty interest at the SJ Claims:

Royalties on Development Stage Properties

The following is a description of our principal royalty interests on development stage properties. There are proven and probable reserves associated with these properties as indicated below. These development stage royalty interests are not currently in production. Reserves for our development stage properties are summarized below in this report in Item 2, Properties — Reserve Information.

Peñasquito Project (Zacatecas, Mexico)

We own a production payment equivalent to a 2.0% NSR royalty on all metal production from the Peñasquito project, located in the State of Zacatecas, Mexico, and operated by Goldcorp. The Peñasquito project is located approximately 17 miles west of the town of Concepción del Oro, Zacatecas, Mexico. The project, composed of two main deposits called Peñasco and Chile Colorado, hosts large silver, gold, zinc and lead reserves. The deposits consist of oxide and sulfide portions.

Goldcorp recently reported that construction is progressing at Peñasquito and that several construction milestones were completed during the second calendar quarter of 2008. In May 2008, Peñasquito poured the first gold from the oxide circuit. Accordingly, during our fourth quarter of fiscal 2008, we reclassified our cost basis in the oxide circuit from development stage to production stage. Goldcorp expects production at Peñasquito from the first sulfide circuit by late calendar 2009 and expects the second sulfide circuit to be operational near the end of calendar 2010. The Company anticipates that the sulfide circuits will contribute significant royalty revenue to the Company once the circuits reach commercial production.

Dolores (Chihuahua, Mexico)

We own a 1.25% NSR royalty on gold and a 2.0% royalty on both gold and silver from the Dolores project located in Chihuahua, Mexico, and owned and operated by Minefinders. The Dolores project is located approximately 155 miles west of the city of Chihuahua, Mexico.

Minefinders announced in July 2008 that initial production from the Dolores mine has been delayed until the later portion of third calendar quarter of 2008 due to a blockade that was established in May 2008 by a group of protestors. Minefinders also announced that the revised timing (from mid-July 2008) for the initial production will affect previously released calendar 2008 production estimates, but did not provide updated guidance. The 2.0% NSR royalty becomes effective when the facility has been producing at 75% of its design capacity for three consecutive months. This royalty was acquired as part of the Battle Mountain acquisition on October 24, 2007. Please refer to Item 7, MD&A, of this report for further information.

Pascua-Lama Project (Region III, Chile)

We own a 0.16% to 1.08% sliding-scale NSR royalty on the Pascua-Lama project located on the border of Argentina and Chile, and operated by a subsidiary of Barrick. The Pascua-Lama project is located within 6.25 miles of Barrick’s Valedaro project. The sliding-scale NSR royalty is based upon gold price as shown in the following table.

London PM Monthly Average										NSR
Price of Gold Per Ounce ($U.S.)										Royalty Percentage
Below						$	325.00				0.16	%
$325.01			—			$	350.00				0.22	%
$350.01			—			$	375.00				0.27	%
$375.01			—			$	400.00				0.32	%
$400.01			—			$	500.00				0.56	%
$500.01			—			$	600.00				0.73	%
$600.01			—			$	800.00				0.91	%
$800.01			—			and above					1.08	%

When the average quarterly gold price is between any two price ranges above, the royalty rate is proportional to the change in gold price.

Our royalty interest is applicable to all the gold production from Chile. The Company owns an additional royalty equivalent to 0.216% of proceeds from copper produced in Chile, net of allowable deductions, sold on or after January 1, 2017.

Reserve Information

Table 1 below summarizes proven and probable reserves for gold, silver, copper, zinc and lead that have been reported to us by the operators of our royalty interests as of December 31, 2007. Please refer to pages 28-29 for the footnotes to Table 1.

TABLE 1

Summary of Proven and Probable Gold Reserves^(1,2)
Production Stage Royalties
As of December 31, 2007⁽³⁾

														Gold
						Tons of				Average Gold				Contained
						Ore				Grade				Ounces
Royalty		Operator		Category		(millions)				(ounces per ton)				(millions) (4)
Cortez GSR1(5)		Barrick		Proven			4.47				0.092				0.410
				Probable			27.70				0.045				1.239
Cortez GSR2(5)		Barrick		Proven			1.30				0.029				0.037
				Probable			10.62				0.022				0.236
Cortez GSR3(5)		Barrick		Proven			5.77				0.078				0.448
				Probable			38.32				0.038				1.475
Cortez NVR1(5)		Barrick		Proven			3.71				0.054				0.201
				Probable			33.53				0.035				1.186
Robinson		Quadra		Proven			96.89				0.007				0.669
				Probable			17.51				0.006				0.103
Taparko TB-GSR1(6)		High River		Reserve			3.70				0.082				0.303	(7,8)
Taparko TB-GSR2(6)		High River		Reserve			3.70				0.082				0.303	(7,8)
Leeville Mining Complex(9)		Newmont		Reserve			5.06				0.427				2.161
Goldstrike—SJ Claims(9)		Barrick		Reserve			52.49				0.133				6.960
Mulatos(10)		Alamos		Proven			6.76				0.061				0.411
				Probable			28.66				0.045				1.278
Bald Mountain(9)		Barrick		Reserve			31.46				0.028				0.889
El Chanate(11)		Capital Gold		Proven			29.42				0.020				0.581
				Probable			14.07				0.018				0.251
Don Mario(12) (LMZ)		Orvana		Reserve			0.56				0.337				0.189	(13)
Williams		Williams		Proven			7.24				0.073				0.528
				Probable			2.69				0.119				0.319
Peñasquito (oxide) (14)		Goldcorp		Proven			46.41				0.006				0.283
				Probable			121.69				0.005				0.367
El Limon		Central Sun		Proven			0.17				0.176				0.030
				Probable			1.35				0.138				0.187

TABLE 1 (Continued)

Summary of Proven and Probable Gold Reserves^(1,2)
Development Stage Royalties
As of December 31, 2007⁽³⁾

														Gold
										Average Gold				Contained
						Tons				Grade				Ounces
Royalty		Operator		Category		(millions)				(ounces per ton)				(millions)(4)
Peñasquito (sulfide)(14)		Goldcorp		Proven			470.57				0.017				7.855
				Probable			419.09				0.011				4.546
Dolores		Minefinders		Proven			62.42				0.023				1.454
				Probable			47.04				0.021				0.990
Pascua-Lama(15)		Barrick		Proven			35.71				0.053				1.900
				Probable			288.80				0.044				12.700
Taparko TB-GSR3(6,8)		High River		Reserve			6.06				0.082				0.497
Gold Hill(9)		Kinross		Reserve			—				—				0.750	(16)
Marigold(9)		Goldcorp		Reserve			44.59				0.019				0.867
Don Mario(12) (UMZ)		Orvana		Proven			1.18				0.041				0.049
				Probable			4.82				0.041				0.200
Benso		Golden Star		Probable			2.54				0.099				0.252

Summary of Proven and Probable Silver Reserves^(1,17)
Production Stage Royalties
As of December 31, 2007⁽³⁾

														Silver
										Average Silver				Contained
						Tons				Grade				Ounces
Royalty		Operator		Category		(millions)				(ounces per ton)				(millions)(3)
Peñasquito (oxide) (14)		Goldcorp		Proven			46.41				0.61				28.244
				Probable			75.29				0.48				36.061
Martha		Coeur d'Alene		Proven			0.06				52.95				2.924
				Probable			0.10				54.55				5.369
Troy(6) 7.0% GSR		Revett		Reserve			2.01				1.18				2.379	(18)
6.1% GSR				Reserve			1.73				1.18				2.046
2.0% GSR				Reserve			2.61				1.18				3.085

TABLE 1 (Continued)

Summary of Proven and Probable Silver Reserves^(1,17)
Development Stage Royalties
As of December 31, 2007⁽³⁾

														Silver
										Average Silver				Contained
						Tons				Grade				Ounces
Royalty		Operator		Category		(millions)				(ounces per ton)				(millions)(3)
Peñasquito (sulfide)(14)		Goldcorp		Proven			470.57				0.99				466.993
				Probable			419.09				0.79				332.561
Dolores		Minefinders		Proven			62.42				1.18				73.415
				Probable			47.041				1.13				53.230
Don Mario(12) (UMZ)		Orvana		Proven			1.18				1.59				1.877
				Probable			4.82				1.30				6.276

Summary of Proven and Probable Copper Reserves^(1,19)
Production Stage Royalties
As of December 31, 2007⁽³⁾

														Copper
										Average Copper				Contained
						Tons				Grade				Pounds
Royalty		Operator		Category		(millions)				(% Cu)				(millions)(4)
Robinson		Quadra		Proven			96.89				0.61				1,188
				Probable			17.51				1.07				375
Troy(6) 7.0%		Revett		Reserve			1.94				0.54				21	(18)
6.1%				Reserve			1.58				0.54				17
2.0%				Reserve			3.70				0.54				40

Summary of Proven and Probable Zinc Reserves^(1,20)
Development Stage Royalties
As of December 31, 2007⁽³⁾

Zinc

Average Zinc

Contained

Tons

Grade

Pounds

Royalty

Operator

Category

(millions)

(% Zn)

(millions)(4)

Peñasquito (sulfide)(14)

Goldcorp

Proven

470.57

0.78

7,363

Probable

419.09

0.65

5,445

Don Mario(12) (UMZ)

Orvana

Proven

1.18

1.62

38

Probable

4.82

1.47

142

TABLE 1 (Continued)

Summary of Proven and Probable Lead Reserves^(1,21)
Development Stage Royalties
As of December 31, 2007⁽³⁾

Lead

Average Zinc

Contained

Tons

Grade

Pounds

Royalty

Operator

Category

(millions)

(% Pb)

(millions)(4)

Peñasquito (sulfide)(14)

Goldcorp

Proven

470.57

0.36

3,439

Probable

419.09

0.29

2,447

Footnotes to Table 1

Table 2 below summarizes additional mineralization for gold, silver, copper, lead and zinc which have been reported to us by the operators of our royalty interests as of December 31, 2007. Please refer to page 33 for the footnotes to Table 2.

TABLE 2

Gold Additional Mineralized Material⁽¹⁾
Production Stage Royalties
As of December 31, 2007

										Average Gold
				Additional Mineralized		Tons				Grade
Royalty		Operator		Material		(millions)				(ounces per ton)
				Measured(2,3)			2.89				0.025
				Indicated(2,3)			29.43				0.020
Cortez GSR1(3)		Barrick		Inferred(2,3)			4.33				0.013
				Measured(2,3)			3.49				0.044
				Indicated(2,3)			24.70				0.039
Cortez GSR2(3)		Barrick		Inferred(2,3)			0.94				0.019
				Measured(2,3)			6.38				0.035
				Indicated(2,3)			54.14				0.028
Cortez GSR3(3)		Barrick		Inferred(2,3)			5.26				0.014
				Measured(2,3)			3.84				0.044
				Indicated(2,3)			28.67				0.037
Cortez NVR1(3)		Barrick		Inferred(2,3)			3.38				0.012
				Measured(2,4)			573.00				0.005
				Indicated(2,4)			147.00				0.003
Robinson		Quadra		Inferred(2,4)			89.00				0.002
				Measured(2)			—				—
				Indicated(2)			2.51				0.082
Taparko		High River		Inferred(2)			1.22				0.083
Leeville Mining Complex		Newmont		—(5)			0.64				0.446
				Measured(2)			2.76				0.055
				Indicated(2)			4.06				0.050
Goldstrike—SJ Claims		Barrick		Inferred(2)			—				—
				Measured(2)			12.31				0.029
				Indicated(2)			58.47				0.027
Mulatos(6)		Alamos		Inferred(2)			—				—
				Measured & Indicated(2)			7.64				0.026
Bald Mountain		Barrick		Inferred(2)			—				—
				Measured(2,8)			11.31				0.018
				Indicated(2,8)			32.85				0.020
El Chanate		Capital Gold		Inferred(2,8)			6.15				0.021
				Measured(2)			1.71				0.090
				Indicated(2)			2.37				0.154
Williams		Williams		Inferred(2)			6.21				0.127
				Measured(2)			8.71				0.002
				Indicated(2)			38.25				0.003
Peñasquito (oxide)(7)		Goldcorp		Inferred(2)			45.19				0.004
				Measured(2)			0.03				0.136
		Central		Indicated(2)			0.39				0.147
El Limon		Sun		Inferred(2)			—				—

TABLE 2 (Continued)

Gold Additional Mineralized Material⁽¹⁾
Development Stage Royalties
As of December 31, 2007

										Average Gold
				Additional		Tons				Grade
Royalty		Operator		Mineralized Material		(millions)				(ounces per ton)
				Measured(2)			109.24				0.008
				Indicated(2)			591.71				0.006
Peñasquito (sulfide)(7)		Goldcorp		Inferred(2)			1,299.61				0.007
				Measured &
				Indicated(2)			7.70				0.090
Dolores		Minefinders		Inferred(2)			33.45				0.020
				Measured(2)			8.16				0.037
				Indicated(2)			62.39				0.035
Pascua-Lama		Barrick		Inferred(2)			7.28				0.027
				Measured(2)			—				—
				Indicated(2)			0.45				0.072
Benso		Golden Star		Inferred(2)			0.67				0.099

Silver Additional Mineralized Material⁽¹⁾
Production Stage Royalties
As of December 31, 2007

										Average Silver
				Additional		Tons				Grade
Royalty		Operator		Mineralized Material		(millions)				(ounces per ton)
				Measured(2)			8.71				0.20
				Indicated(2)			38.25				0.21
Peñasquito (oxide)(7)		Goldcorp		Inferred(2)			45.19				0.38
				Measured(2)			35.16				1.46
				Indicated(2)			10.93				1.05
Troy(9)		Revett		Inferred(2)			—				—
				Measured(2)			0.039				46.33
				Indicated(2)			0.053				29.78
Martha		Coeur d'Alene		Inferred(2)			0.072				27.53

Silver Additional Mineralized Material⁽¹⁾
Development Stage Royalties
As of December 31, 2007

Average Silver

Additional

Tons

Grade

Royalty

Operator

Mineralized Material

(millions)

(ounces per ton)

Measured(2)

109.24

0.65

Indicated(2)

591.71

0.56

Peñasquito (sulfide)(7)

Goldcorp

Inferred(2)

1,299.61

0.38

Measured &

Indicated(2)

7.70

2.87

Dolores

Minefinders

Inferred(2)

33.45

0.82

Copper Additional Mineralized Material⁽¹⁾
Production Stage Royalties
As of December 31, 2007

				Additional		Tons				Average Copper
Royalty		Operator		Mineralized Material		(millions)				Grade (%)
				Measured(2)			573.00				0.43
				Indicated(2)			147.00				0.30
Robinson		Quadra		Inferred(2)			89.00				0.28
				Measured(2)			35.16				0.72
				Indicated(2)			10.93				0.46
Troy(9)		Revett		Inferred(2)			—				—

Lead Additional Mineralized Material⁽¹⁾
Development Stage Royalties
As of December 31, 2007

Average Lead

Additional

Tons

Grade

Royalty

Operator

Mineralized Material

(millions)

(%)

Measured(2)

109.24

0.24

Indicated(2)

591.71

0.20

Peñasquito (sulfide)(7)

Goldcorp

Inferred(2)

1,299.61

0.08