Silver Wheaton Amends Constancia Streaming Agreement to Include Gold

- November 4th, 2013

Silver Wheaton Corp. (TSX:SLW,NYSE:SLW) announced that it has amended its silver stream purchase agreement with Hudbay Minerals Inc. (TSX:HBM,NYSE:HBM), under which it is set to acquire 100 percent of life-of-mine silver production from the company’s Constancia project, to include 50 percent of life-of-mine gold production.

Silver Wheaton Corp. (TSX:SLW,NYSE:SLW) announced that it has amended its silver stream purchase agreement with Hudbay Minerals Inc. (TSX:HBM,NYSE:HBM), under which it is set to acquire 100 percent of life-of-mine silver production from the company’s Constancia project, to include 50 percent of life-of-mine gold production. To do so, Silver Wheaton will pay Hudbay US$135 million.

Transaction highlights include:

Adds to Silver Wheaton’s growth profile

  • Silver Wheaton will receive 50% of the life of mine gold production from Constancia.
  • Forecast average annual attributable gold production from Constancia is anticipated to be approximately 35,000 gold ounces over the first five years, and 18,000 ounces life of mine. The mine life is currently estimated at around 16 years.

Aligns the interests of both companies

  • Hudbay will retain 50% of gold production.
  • Timing of the upfront payment is linked to Constancia’s capital expenditures.

Maintains conservative balance sheet

  • Silver Wheaton has the option to make the initial upfront payment in either cash or Silver Wheaton shares, calculated at the time the payment is made.

Updating production guidance

  • Silver Wheaton has revised 2017 guidance to reflect recent developments.  2017 guidance is now forecast to be 42.5 million silver equivalent ounces3 including 210 thousand ounces of gold.
  • 2013 silver equivalent production is still expected to exceed 33.5 million ounces including 145 thousand ounces of gold.

Click here to read the full Silver Wheaton Corp. (TSX:SLW,NYSE:SLW) press release.

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