Mentioned:
Wheaton Precious Metals is one of the largest precious metals streaming companies in the world. And with gold prices rising, they are cutting new deals.
What’s happening:
- Wheaton Precious Metals (NYSE: WPM) has entered into a new gold streaming deal with Montage Gold (TSXV: MAU)
By the numbers:
- Wheaton Precious Metals will pay Montage Gold $625M USD in cash upfront and ongoing payments for gold ounces that are delivered at 20% of the price of spot gold
- Wheaton Precious Metals will also provide $75M USD in debt financing to Montage Gold to help fund production from their One gold project
- Montage Gold expects they will produce an average of 301,000 ounces per year in the first eight years
Why it matters:
- Gold prices have soared to new all time highs, which has caused a spike in capital inflows to promising early stage publicly listed gold exploration projects and even caused Costco (NASDAQ: COST) to be unable to keep up with the demand for physical gold purchases from customers
Going deeper:
- Montage Gold has some of the world’s largest precious metals companies as shareholders, including the Lundin Group and Zijin Mining
- Montage Gold’s Koné project is widely considered to be one of the highest quality gold mines in all of Africa, with high grade deposits and very low production costs
