Royal Gold to Acquire Battle Mountain Gold Exploration

DENVER, March 5 /PRNewswire-FirstCall/ -- ROYAL GOLD, INC. and Battle Mountain Gold Exploration Corp. (BULLETIN BOARD: BMGX) ("Battle Mountain") today announced that Battle Mountain has accepted Royal Gold's proposal to acquire 100% of the fully diluted shares of Battle Mountain for approximately 1.57 million shares of Royal Gold common stock in a merger transaction. This represents a value of $0.60 per fully diluted share of Battle Mountain, or a 29% premium to the 20-day weighted average trading price of Battle Mountain as of Friday, February 23, 2007. The proposal is subject to satisfactory completion of due diligence, definitive documentation, and receipt of a fairness opinion satisfactory to Royal Gold's Board of Directors, among other conditions.

To ensure continuity of Battle Mountain's business, Royal Gold and Battle Mountain also entered into a binding term sheet, as of February 28, 2007, to provide up to $20 million in bridge financing to satisfy debt obligations and finalize royalty acquisitions. The bridge loan is convertible into Battle Mountain common stock at the election of Royal Gold, at $0.60 per share.

Battle Mountain is a precious metals royalty company with a portfolio consisting of 12 properties located mainly in the Americas. Their principal assets include a 1.25% net smelter return ("NSR") royalty on gold production from the Dolores project in Mexico, under development by Minefinders Corporation Ltd. Battle Mountain also has an option to acquire an additional 2.0% NSR royalty on gold and silver production from the Dolores project. Including the option, Battle Mountain's properties contain approximately 4.8 million ounces of gold reserves and 136 million ounces of silver reserves(1).

Tony Jensen, Royal Gold's President and CEO, stated, "This transaction will further diversify our portfolio of producing royalties and strengthens our pipeline of development-stage assets, with the Dolores project expected to commence production later this year. We are pleased with both the near-term and long-term financial impacts this transaction will have on Royal Gold and will continue to remain vigilant in our search for further accretive opportunities."

Mark Kucher, Battle Mountain Chairman and CEO, commented, "We are pleased to combine our assets with the premier precious metal royalty company in the business. Royal Gold has the experience, talent and resources to continue to provide an excellent return for our shareholders."

In anticipation of this transaction, Royal Gold has obtained a binding support agreement and option to purchase approximately 18% of the outstanding common stock of Battle Mountain from Mark Kucher, which provides that he will vote for and support the transaction. Royal Gold and Battle Mountain also entered into a binding agreement providing for a 45-day exclusive period to conclude definitive documentation for the merger and providing for break-up fees payable to Royal Gold in the event Battle Mountain enters into a competing agreement with another party within twelve months. There is also a mutual break-up fee payable in the event that either party breaches the agreement.

Royal Gold is a precious metals royalty company engaging in the acquisition and management of precious metal royalty interests. Royal Gold is publicly-traded on the NASDAQ Global Select Market under the symbol "RGLD," and on the Toronto Stock Exchange under the symbol "RGL." The Company's web page is located at http://www.royalgold.com/.

(1) For an overview of Battle Mountain's royalty portfolio refer to Appendix A.

Cautionary "Safe Harbor" Statement Under the Private Securities Litigation Reform Act of 1995: With the exception of historical matters, the matters discussed in this press release are forward-looking statements that involve risks and uncertainties that could cause actual results to differ materially from projections or estimates contained herein. Such forward-looking statements include statements regarding gold and silver reserve totals, diversification of our producing royalty portfolio, strengthening of our development-stage royalty assets, commencement of production at the Dolores project, completion of due diligence, definitive documentation and other closing conditions including receipt of a satisfactory fairness opinion. Like any royalty acquisition on a non-producing or not yet in development project, Battle Mountain's developmental royalties are subject to certain risks, such as the ability of the operator to bring the project into production and operate in accordance with the feasibility study and the ability of Royal Gold to make accurate assumptions regarding valuation and timing and amount of royalty payments. In addition, the acquired royalty interests and development projects are subject to risks associated with conducting business in a foreign country, including application of foreign laws to contract and other disputes, foreign environmental laws and enforcement and uncertain political and economic environments. Factors that could cause actual results to differ materially from forward-looking statements include, among others, negotiation of definitive documentation, satisfactory completion of due diligence and other closing conditions, precious metals prices, decisions and activities of the operator of the property, unanticipated grade, geological, metallurgical, processing or other problems the operator may encounter, changes in project parameters as plans continue to be refined, economic and market conditions, as well as other factors described elsewhere in this press release and in our Annual Report on Form 10-K, and other filings with the Securities and Exchange Commission. Most of these factors are beyond Royal Gold's ability to predict or control. Royal Gold disclaims any obligation to update any forward-looking statement made herein. Readers are cautioned not to put undue reliance on forward-looking statements.

Appendix A Battle Mountain Gold Exploration's Royalty Portfolio Properties with Proven and Probable Ore Reserves (1),(2) Property Location Ownership NSR Status Rate % Williams Mine Ontario Teck Cominco 0.72 Operating (50%), Barrick Gold (50%) Don Mario Mine Bolivia Orvana Minerals 3.0 Operating El Limon Mine & La India Resource Nicaragua Glencairn Gold 3.0 Operating (95%), Inversiones Mineras S.A. (5%) Joe Mann Mine Quebec Campbell 1.00(4) Operating Resources Dolores Project Mexico Minefinders 1.25(4) Operations to begin 2007 Dolores Project Mexico Minefinders 2.05(5) Operations to begin 2007 Property Metal Tons/ Average Grade Contained Tonnes (opt/gpt) Ounces(3) (millions) (millions) Au Ag Au Ag Williams Mine Gold 19.5/17.7 0.076/ -- 1.49 -- 2.62 Don Mario Mine Gold 7.2/6.5 0.087/ 1.14/ 0.62 8.2 and 2.97 39.2 Silver El Limon Mine & La India Resource Gold 1.4/1.3 0.156/ -- 0.22 -- 5.34 Joe Mann Mine Gold 0.08/0.07 0.214/ -- 0.02 -- 7.35 Dolores Project Gold 110.5/100.2 0.022/ -- 2.45 -- 0.76 Dolores Project Gold 110.5/100.2 0.022/ 1.16/ 2.45 127.8 and 0.76 39.7 Silver Total Reserves 4.8 136.0 Appendix A (continued) Battle Mountain Gold Exploration's Royalty Portfolio Development and Exploration Properties Property Location Ownership NSR Status Rate % Sega Resource Burkina Faso Orezone 3.06(6) Resource Resources Development Relief Canyon Nevada Firstgold 4.0 Exploration Fletcher Junction Project Nevada Pediment Gold 1.25 Exploration Hot Pot Project Nevada Pediment Gold 1.25 Exploration Marmato Properties Colombia Mineros 5.0 Exploration Nacionales S.A. Night Hawk Lake Property Ontario Selkirk Metals 2.5 Exploration (40%), East West Resource (40%), Canadian Golden Dragon (20%) Lluvia de Oro Mine Mexico Columbia Metals, 2.0 Care and Tara Gold Maintenance Resources Property Metal Tons/ Average Grade Tonnes (opt/gpt) (millions) Au Sega Resource Gold -- -- Relief Canyon Gold -- -- Fletcher Junction Project Gold -- -- Hot Pot Project Gold -- -- Marmato Properties Gold -- -- Night Hawk Lake Property Base -- -- Metals Lluvia de Oro Mine Gold -- -- (1) Set forth below are the definitions of proven and probable reserves used by the U.S. Securities and Exchange Commission. Some of these royalty operators are Canadian issuers. Their definitions of "mineral reserve," "proven mineral reserve" and "probable mineral reserve" conform to the Canadian Institute of Mining, Metallurgy and Petroleum definitions of these terms as of the effective date of estimation as required by National Instrument 43-101 of the Canadian Securities Administrators. "Reserve" is that part of a mineral deposit which could be economically and legally extracted or produced at the time of the reserve determination. "Proven (Measured) Reserves" are reserves for which (a) quantity is computed from dimensions revealed in outcrops, trenches, workings or drill holes, and the grade is computed from the results of detailed sampling, and (b) the sites for inspection, sampling and measurement are spaced so closely and the geologic character is so well defined that the size, shape, depth and mineral content of the reserves are well established. "Probable (Indicated) Reserves" are reserves for which the quantity and grade are computed from information similar to that used for proven (measured) reserves, but the sites for inspection, sampling and measurement are farther apart or are otherwise less adequately spaced. The degree of assurance of probable (indicated) reserves, although lower than that for proven (measured) reserves, is high enough to assume geological continuity between points of observation. (2) This information is derived from publicly-available information from the operators of the properties and Battle Mountain Gold Exploration's National Instrument 43-101 reports. (3) "Contained ounces" are 100% of the reserves subject to the royalty interests and do not take into account losses in processing the ore. (4) Royalty applies to gold production only. (5) Battle Mountain holds an option to acquire a 2% NSR royalty which applies to both gold and silver. (6) Orezone has the right to buy back up to 2.0% of the royalty for $2 million.