Canada's Triple Flag, China's CMOC agree to streaming deal for Australian mine

Triple Flag would also pay CMOC 10% of the spot gold and spot silver price for each ounce at the time of each delivery

  
Image for illustrative purpose. A worker at the Ashanti goldfields big mine in Obuasi, Ghana, prepares sheets of steel wool that contain gold in the final stage of processing before the gold is poured in this October 23, 2003 file photo. REUTERS/Luc Gnago/Files

Image for illustrative purpose. A worker at the Ashanti goldfields big mine in Obuasi, Ghana, prepares sheets of steel wool that contain gold in the final stage of processing before the gold is poured in this October 23, 2003 file photo. REUTERS/Luc Gnago/Files

REUTERS/Luc Gnago/Files

Mine financing company Triple Flag Precious Metals Corp said on Sunday it has agreed to pay $550 million upfront as part of a streaming financing deal with China Molybdenum Co Ltd  (CMOC) for future production of precious metals at CMOC’s Northparkes mine in Australia.

Streaming transactions are a type of alternative financing in the mining industry where funds are provided upfront to a miner in exchange for the sale of a fixed amount of future production of metals at a discounted price.

The deal, between units of the two companies, gives Triple Flag rights to a majority of gold and silver to be produced at the mine in New South Wales until the Toronto-based company receives 630,000 ounces of gold and 9 million ounces of silver.

Thereafter, Elliott Management-backed Triple Flag would continue to receive less than half of the gold and silver produced at the mine.

On top of the $550 million upfront payment, Triple Flag would also pay CMOC 10% of the spot gold and spot silver price for each ounce at the time of each delivery.

(Reporting by Ismail Shakil in Bengaluru; Editing by Aurora Ellis)

© Reuters News 2020

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