Vancouver, British Columbia – Wheaton Precious Metals Corp. announces a new agreement through its subsidiary, Wheaton Precious Metals International., with Waterton Copper. The agreement pertains to a silver stream on the Mineral Park Mine in Arizona, USA.
Randy Smallwood, Wheaton’s President and CEO, comments on the acquisition, highlighting the company’s history with Mineral Park and the operational optimizations by Waterton Copper. The focus is on sustainable production and the importance of copper in a low-carbon economy.
Isser Elishis, Executive Chairman of Waterton Copper, acknowledges Wheaton’s support, detailing a $600 million investment in Mineral Park. This includes upgrades like new crushers and mills, ensuring operational excellence for decades.
Transaction Overview:
– Wheaton Precious Metals International Ltd. will provide $115 million in cash to Waterton Copper, distributed across four construction payments.
– The agreement guarantees Wheaton 100% of the mine’s payable silver, calculated with a 90% fixed payable factor, for the mine’s lifetime.
– Initial forecasts suggest an average annual production exceeding 0.69 million ounces of silver in the first five years, increasing to 0.74 million ounces annually over the mine’s life.
– Wheaton agrees to ongoing production payments, set at 18% of the spot silver price initially, moving to 22% after full upfront payment.
– Mineral Park’s inclusion in Wheaton’s portfolio boosts its estimated silver reserves and resources significantly.
– Additional agreement terms cover a variety of operational, financial, and ethical commitments between the companies.
Financial Strategy:
As of June 30, 2023, Wheaton reported approximately $829 million in cash reserves. The company is prepared for the acquisition and potential future purchases, backed by a $2 billion revolving credit facility and operating cash flows.
About the Companies:
Wheaton Precious Metals is a major precious metals streaming company, known for high-quality, low-cost assets, and a robust business model. It emphasizes sustainable mining practices and community involvement.
Waterton Copper, via Origin, operates Mineral Park, a mine with diverse metals located in Arizona. Currently, the mine is undergoing a substantial Phase 2 construction, projected for completion by Q1 2025, with significant investment from Waterton Copper.
