Brazilian mining company Vale has signed an agreement to sell an additional 25% premium of the payable gold stream in copper concentrate from the Salobo copper mine to Silver Wheaton (SWC) for $800m.

The company’s latest move is aimed at reducing net debt load, which is more than $27bn.

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The original agreement was signed in February 2013 and it is now amended to provide for the additional premium of the gold stream.

"Salobo is the ideal asset for the streaming model, as it is primarily a base metal producer where precious metals represent only a relatively small portion of the mine's overall revenues."

Vale said that the company may also receive an additional cash payment contingent on its decision to expand its capacity to process Salobo copper ores to over 28 Mtpy before 2036.

Depending on ore grade, timing and size of the expansion, the additional cash payment is expected to range from $113m to $953m.

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Salobo I and Salobo II, which are ramping up, will have a total 24 Mtpy of run-of-mine (ROM) processing capacity.

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Under the agreement, SWC will be entitled to a total of 75% of the life-of-mine gold production from the mine.

The deal will increase the company’s consolidated production and cash flow profile as Salobo gold production is expected to average about 300,000oz per year in total between 2016 and 2020.

SWC president and CEO Randy Smallwood said: "We did not hesitate at the opportunity to increase our exposure to a mine with one of the lowest copper cash costs in the world, 50 years of mine life on reserves alone, and what we believe to be substantial exploration and expansion potential.

“As we have said on numerous occasions, Salobo is the ideal asset for the streaming model, as it is primarily a base metal producer where precious metals represent only a relatively small portion of the mine's overall revenues."