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Canadian miner Wheaton Precious Metals has reached a $300m (C$405.17m) streaming deal with Lumina Gold to purchase product from its Cangrejos gold-copper project in Ecuador.

The purchase agreement was executed by Wheaton Precious Metals International, Wheaton’s fully owned unit.  

Located in El Oro Province, the Cangrejos project is forecast to be a high-margin project with a mine life of 26 years.

With the addition of Cangrejos, Wheaton expects that its proven and probable gold reserves will reach 0.76 million ounces (moz).

It will also increase measured and indicated resources by 0.25moz and inferred resources by 0.16moz, respectively.

Furthermore, the company believes there is significant potential within the Cangrejos property.

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Wheaton will pay Lumina $300m in upfront cash, $48m of which will be paid as an early deposit for pre-construction. This early deposit will include four components.

The remaining $252m will be paid in staged equal instalments during the project’s construction, subject to the fulfilment of several customary conditions.

Wheaton agreed to purchase 6.6% of gold from the project until 700,000oz has been delivered.

From then on, the purchase will be reduced to 4.4% for the life of the mine.

The project is anticipated to produce an annual average of more than 24,000oz of gold for the first ten years, and exceeding 24,500oz for the life of the mine. 

Wheaton Precious Metals president and CEO Randy Smallwood said: “The Cangrejos Project is an excellent addition to Wheaton’s existing portfolio of high-quality, low-cost assets as it should provide accretive, long-term growth, as well as significant exploration potential. We welcome the opportunity to work with the team at Lumina who have done an outstanding job at working to de-risk the project and advancing it towards construction.

“As with any transaction Wheaton enters into, responsible and sustainable mining practices are paramount, and Wheaton looks forward to supporting Lumina both financially as they construct Cangrejos and with their ongoing comprehensive community engagement efforts.”