Wheaton Precious Metals Announces the Acquisition of a New Silver Stream on the Mineral Park Mine

25 October 2023

Wheaton Precious Metals™ Corp. is pleased to announce that its wholly-owned subsidiary, Wheaton Precious Metals International Ltd. ("WPMI") has entered into a definitive Precious Metals Purchase Agreement (the "Silver Stream") with Waterton Copper Corp., a subsidiary of Waterton Copper LP ("Waterton Copper") in respect to its 100% owned Mineral Park Mine located in Arizona, USA (the "Project" or "Mineral Park").

"Wheaton is excited to bring Mineral Park back into our portfolio given our long history with the mine, particularly given the work Waterton Copper has done to optimize the operation," said Randy Smallwood, Wheaton's President and Chief Executive Officer. "Our unique understanding of Mineral Park, and its potential, positions us well to assist Waterton Copper in bringing the mine back into production in a sustainable manner. As global efforts to transition to a low-carbon economy accelerate, critical metals, such as copper, that are produced responsibly within politically stable jurisdictions, have never been more important.

"Waterton Copper is delighted to have Wheaton Precious Metals' support," said Isser Elishis, Executive Chairman of Waterton Copper. "Waterton is investing approximately $600 million to optimize Mineral Park including significant capital investments in new primary crushers, secondary and pebble crushing circuits, and new higher-power SAG mills, which are expected to result in decades of operational excellence."

Transaction Details
(All values in US$ unless otherwise noted)

  • Upfront Consideration: WPMI will pay Waterton Copper total upfront cash consideration of $115 million (the "Deposit") in four payments during construction (three installments of $25 million and a final installment of $40 million).
  • Streamed Metal: Under the Silver Stream, WPMI will purchase 100% of the payable silver from the Project for the life of the mine. Payable silver is calculated using a fixed payable factor of 90%.
  • Production Profile1: Attributable production is forecast to average over 0.69 million ounces ("Moz") of silver per year for the first five years of production and over 0.74 Moz of silver per year for the life of mine, with construction to be completed by the end of Q1 2025. Mineral Park is forecast to have a 12-year mine life, with the potential to expand the mine life to over 20 years.
  • Production Payments: WPMI will make ongoing payments for the silver ounces delivered equal to 18% of the spot price of silver ("Production Payment") until the uncredited deposit is reduced to nil and 22% of the spot price of silver thereafter.
  • Incremental Reserves and Resources1: The addition of Mineral Park will increase Wheaton's total estimated Proven and Probable Mineral silver reserves by 14.6 Moz, Measured and Indicated Mineral silver resources by 18.4 Moz and Inferred silver resources by 16.2 Moz.

Other Considerations:

  • The Silver Stream will include a customary completion test.
  • WPMI will provide a secured debt facility of up to $25 million once the full upfront consideration has been paid.
  • WPMI has also obtained a right of first refusal on any future precious metals streams, royalty, prepay or similar transactions.
  • Waterton Copper and Origin Mining Company, LLC (the direct owner of Mineral Park, "Origin") will provide WPMI with corporate guarantees and certain other security over their assets.
  • Waterton Copper is expected to comply in all material respects with WPMI's Partner/Supplier Code of Conduct, which outlines Wheaton's expectations in regard to environmental, social and governance ("ESG") matters.

Financing the Transactions
As at June 30, 2023, the Company had approximately $829 million of cash on hand, which we believe when combined with the liquidity provided by the available credit under the $2 billion revolving term loan and ongoing operating cash flows, positions the Company well to fund the acquisition of the Silver Stream as well as all outstanding commitments and known contingencies and provides flexibility to acquire additional accretive mineral stream interests.