WPMI will pay a total upfront consideration of $115m in four payments, including three instalments of $25m and a final instalment of $40m, to purchase 100% of the payable silver produced from the project for the life of the mine
The Mineral Park mine in Arizona. (Credit: Doc Searls/Wikipedia)
Wheaton Precious Metals, through its subsidiary Wheaton Precious Metals International (WPMI), has agreed to purchase 100% of the Mineral Park mine in Arizona, US.
WPMI has signed a definitive precious metals purchase agreement with Waterton Copper, a subsidiary of Waterton Copper to acquire the property.
Under the terms of the agreement, WPMI will pay a total upfront consideration of $115m in four payments, including three instalments of $25m and a final instalment of $40m.
WPMI will purchase 100% of the payable silver produced from the project for the life of the mine, which is calculated using a fixed payable factor of 90%.
The mine is expected to produce more than 0.69 Moz of silver per annum for the first five years and over 0.74Moz for the mine life of 12 years, which can be expanded up to 20 years.
The construction of the Mineral Park mine is expected to be completed by the end of Q1 2025.
Wheaton president and chief executive officer Randy Smallwood said: “Wheaton is excited to bring Mineral Park back into our portfolio given our long history with the mine, particularly given the work Waterton Copper has done to optimize the operation.
“Our unique understanding of Mineral Park, and its potential, positions us well to assist Waterton Copper in bringing the mine back into production in a sustainable manner.
“As global efforts to transition to a low-carbon economy accelerate, critical metals, such as copper, that are produced responsibly within politically stable jurisdictions, have never been more important.”
WPMI will make ongoing payments for the silver ounces delivered equal to 18% of the silver spot price until the deposit is reduced to nil and 22% of the spot price thereafter.
In addition, WPMI will provide a secured debt facility of up to $25m, upon completion of the full upfront consideration payment.
The company has also obtained a right of first refusal on any future precious metals’ streams, royalty, prepay or similar transactions.
Waterton Copper and Origin Mining Company, the direct owner of Mineral Park, will provide WPMI with corporate guarantees and certain other security over its assets.
Waterton Copper executive chairman Isser Elishis said: Waterton is investing approximately $600m to optimise Mineral Park including significant capital investments in new primary crushers, secondary and pebble-crushing circuits, and new higher-power SAG mills, which are expected to result in decades of operational excellence.”
Wheaton Precious Metals has agreed to acquire a gold stream from Lumina Gold’s fully-owned Cangrejos gold-copper project in El Oro Province, Ecuador.