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November 17, 2021

Wheaton makes $141m silver stream offer for Artemis’ mine in Canada

Wheaton will buy 50% of the silver production from the Blackwater project, until the delivery of 18 million ounces of silver.

Wheaton Precious Metals has made an offer to Artemis Gold to purchase silver production from the Blackwater Gold project in British Columbia, Canada, for a $141m upfront cash payment.

The deposit will be payable in tranches.

Under the agreement, Wheaton will purchase 50% of the production from the project until the delivery of 18 million ounces (Moz) of silver.

After that, the stream to Wheaton will reduce to 33% of production for the life of the mine.

Acquiring Blackwater Gold in August 2020, Artemis has submitted copies of the offer and streaming agreement to the project’s previous owner New Gold.

Within 30 days, New Gold is required to either accept the offer or offer identical terms for Artemis’ silver stream from the project.

The streaming agreement also includes a partial buyback option whereby Artemis will have a one-time option to repurchase up to 33% of the silver stream on 1 January 2025 or begin commercial production.

Artemis Gold plans to use the deal proceeds to advance the project development and construction.

Commenting on the development, Artemis Gold chairman and CEO Steven Dean said: “The cost of capital underlying this stream is extremely competitive. Under the terms of this silver stream facility, Artemis retains full upside to initially 50% increasing to 67% (after delivery of approximately 18Moz of silver) of the by-product silver production from Blackwater.”

Separately, Wheaton Precious Metals agreed to purchase gold production from Rio2’s Fenix Gold Project in Chile, for a $50m upfront cash payment.

According to the deal, Wheaton will buy 6% of the gold production until 90,000oz have been delivered. Production purchase will be then be reduced to 4% until 140,000oz of gold has been delivered.

Thereafter, the stream will be further reduced to 3.5% of the gold production for the project’s operational life.

Rio2 said that the gold stream forms part of mine construction financing, which is estimated at approximately $125m to $135m.

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