Net Smelter Return (NSR) is the net revenue that the owner of a mining property receives from the sale of the mine's metal/non metal products less transportation and refining costs.
It is contingent only on the sales price and quantity of product sold.
[1] The term is named so due to the fact most of the time, mining output sold requires further processing by smelters; the mining products purchased directly by smelters are sold to them for a discounted (net) price based on how much further processing is needed.
[2] The mining lease specifies the selling price (prices are different in spot and forward markets) and is used to verify the exact amount of product that's produced and sold between royalty payments.
Also, mine life and royalty expiration dates need to be taken into consideration.