Wheaton Precious Metals to Acquire Gold and Silver Streams on Artemis’s Blackwater Project for $441M
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Wheaton Precious Metals™ has entered into a definitive agreement to acquire the existing gold stream held by New Gold in respect of gold production from the Blackwater Gold Project located in British Columbia, Canada. In addition, the company has entered into a precious metals purchase agreement with Artemis Gold for silver production from the Blackwater Project.
“The acquisition of the gold and silver streams on the Blackwater Project further enhances and diversifies Wheaton’s existing portfolio of low-cost, high-quality, long-life mines. With strong ESG commitments at every stage of development, compelling economics and significant exploration upside potential, Blackwater incorporates many of the attributes we seek for accretive growth,” said Randy Smallwood, Wheaton’s president and chief executive officer.
“Artemis’s approach of disciplined, responsible resource development aligns well with our own focus on promoting industry-leading mining practices. We are proud to partner with Artemis in the advancement of the Blackwater Project, which we believe is on track to develop into a top-tier operation, producing socially and environmentally sound minerals, right in our own backyard,” added Smallwood.
ABOUT ARTEMIS AND THE BLACKWATER PROJECT
Artemis is a gold development company with a technically driven approach to shareholder value creation through identifying, acquiring and developing gold projects in mining friendly jurisdictions using a disciplined staged approach to development, managing risks while minimizing cost of capital to optimize economics and returns for shareholders.
The primary focus for Artemis is on advancing construction of the Blackwater Project, a project with 8 million ounces of gold in reserves, environmental assessment approval, and the potential to develop into one of the largest gold mines in Canada. The Blackwater Project is forecast to be a first quartile gold mine with a 22 year mine life. Artemis has disclosed that it expects major construction to commence in the second quarter of 2022, with production commencing in the first quarter of 2024.
TRANSACTION DETAILS
• Upfront Consideration: Wheaton will pay total upfront consideration of US$441 million for the precious metal streams. Upon closing of the purchase of the gold stream, Wheaton will pay New Gold US$300 million. Under the silver stream, Wheaton will pay Artemis total upfront cash consideration of approximately US$141 million, which is payable in four equal installments during construction of the Blackwater Project.
• Streamed Metal: Under the gold stream, Wheaton will be entitled to receive 8 percent of the payable gold production until 279,908 ounces have been delivered, thereafter dropping to 4 percent of payable gold production for the life of the mine. Under the silver stream, Wheaton will be entitled to receive 50 percent of the payable silver production until 17.8 million ounces have been delivered, thereafter dropping to 33 percent of payable silver production for the life of the mine.
• Delivery Payments: For gold ounces delivered, Wheaton will make ongoing cash payments equal to 35 percent of the spot gold price. For silver ounces delivered, Wheaton will make ongoing cash payments equal to 18 percent of the spot silver price until the value of silver delivered less the silver production payment is equal to the upfront cash consideration, at which point the silver production payment will increase to 22 percent of the spot silver price.
About Wheaton Precious Metals
Wheaton Precious Metals is one of the largest precious metals streaming companies in the world. The company has entered into agreements to purchase all or a portion of the precious metals or cobalt production from high-quality mines for an upfront payment and an additional payment upon delivery of the metal. Wheaton currently has streaming agreements for 24 operating mines and 8 development stage projects. The company’s production profile is driven by a portfolio of low-cost, long-life assets, including a gold stream on Vale’s Salobo mine, and a silver stream on Newmont’s Peñasquito mine.
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