Centerra to sell portfolio and Canadian silver stream for $200m

21 May 2018 (Last Updated May 21st, 2018 11:34)

Centerra Gold’s wholly owned subsidiary AuRico Metals (AMI) has signed agreements to offload its royalty portfolio and a silver stream on the Kemess project in British Columbia, Canada, to Triple FlagMining Finance Bermuda for an aggregate value of $200m.

Centerra Gold’s wholly owned subsidiary AuRico Metals (AMI) has signed agreements to offload its royalty portfolio and a silver stream on the Kemess project in British Columbia, Canada, to Triple FlagMining Finance Bermuda for an aggregate value of $200m.

The deal will see the sale of AMI’s royalty portfolio, including new 0.5%, 2% and 2% net smelter returns (NSR) royalties on AMI’s Kliyul, Chuchi and Redton exploration properties, respectively.

Under the terms of the deal, Triple Flag will make a cash payment upfront of $155m in exchange for the royalties.

“The high-quality Centerra precious metals royalty portfolio is a perfect fit for Triple Flag’s substantial and growing portfolio.”

The transaction related to the sale of royalties is subject to customary conditions and is anticipated to be closed during the second quarter of this year.

Triple FlagMining Finance CEO Shaun Usmar said: “The high-quality Centerra precious metals royalty portfolio is a perfect fit for Triple Flag’s substantial and growing portfolio of precious metal royalty and streaming assets.

“The Kemess silver stream also nicely complements our suite of growth assets. We look forward to our ongoing partnership with the Centerra team.”

The divestment of the Kemess Stream includes the sale of 100% of the silver production from the Kemess project.

The sale of the silver stream will see the company receive $45m from Triple Flag in four tranches of $10m, $10m, $12.5m and $12.5m.

Centerra noted that Triple Flag is also required to make ongoing payments of 10% of the then-current market price for each ounce of silver delivered.

The deal comes after Centerra rejected an offer made by Chaarat Gold Holdings for the acquisition of the former’s Kumtor mine located in the Kyrgyz Republic.