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Glencore plc (LSE:GLEN) announced that Narila Investments Ltd., its subsidiary, has entered into a long-term streaming agreement with Franco-Nevada (Barbados) Corp., a subsidiary of Franco-Nevada Corp. (TSX:FNV,NYSE:FNV).
Glencore plc (LSE:GLEN) announced that Narila Investments Ltd., its subsidiary, has entered into a long-term streaming agreement with Franco-Nevada (Barbados) Corp., a subsidiary of Franco-Nevada Corp. (TSX:FNV,NYSE:FNV). The agreement is for the delivery of gold and silver, calculated by reference to copper produced at the Peru-based Antapaccay mine.
As quoted in the press release:
This transaction forms part of Glencore’s debt reduction plans announced on 7 September 2015.
Franco-Nevada will make an advance payment of US$500 million to Narila upon closing of the transaction, which is subject to the completion of certain customary conditions and is expected to occur prior to the end of February 2016.
In return, Narila will deliver gold and silver to Franco-Nevada by reference to copper production: 300 ounces of gold per 1,000 tonnes of copper in concentrate up until 630,000 ounces of gold have been delivered and 30% of gold production thereafter; and 4,700 ounces of silver per 1,000 tonnes of copper in concentrate up until 10,000,000 ounces of silver have been delivered and 30% of silver production thereafter.
Franco-Nevada will make ongoing payments of 20% of the spot gold and silver price per ounce delivered which will increase to 30% of the respective spot prices after 750,000 ounces of gold and 12,800,000 ounces of silver have been delivered.
Click here to read the full Glencore plc (LSE:GLEN) press release.