WHEATON PRECIOUS METALS ANNOUNCES ACQUISITION OF A GOLD AND PLATINUM STREAM FROM GENERATION MINING'S MARATHON PROJECT
Wheaton Precious Metals has entered a binding agreement with Generation Mining Limited for a Precious Metal Purchase Agreement regarding the Marathon Project in Ontario, Canada. The deal involves an upfront payment of C$240 million, with Wheaton acquiring 100% of the payable gold production until reaching 150,000 ounces, transitioning to 67% for the mine's life, alongside a platinum stream. The Marathon Project is expected to produce significant quantities of palladium and copper, aligning with the shift to a low-carbon economy, and is projected to have one of the lowest operational carbon footprints globally.
- Acquisition diversifies Wheaton's portfolio with a focus on precious metals.
- Projected annual production includes over 16,000 ounces of gold and 14,000 ounces of platinum in the first five years.
- Marathon Project expected to have one of the lowest operational carbon footprints globally.
- Completion of the agreement is contingent upon Gen Mining's acquisition of a 16.5% interest from Sibanye Stillwater, which introduces uncertainty.
TSX | NYSE | LSE: WPM
VANCOUVER, BC, Dec. 22, 2021 /PRNewswire/ - Wheaton Precious Metals™ Corp. ("Wheaton" or the "Company") is pleased to announce that it has entered into a binding arrangement with Generation Mining Limited ("Gen Mining") (TSX: GENM) for a Precious Metal Purchase Agreement (the "Marathon PMPA") in respect to the Marathon Project located in Ontario, Canada (the "Marathon Project").
"The Marathon Project provides Wheaton with accretive, near-term growth that further diversifies our existing portfolio and preserves our focus on precious metals," said Randy Smallwood, Wheaton's President and Chief Executive Officer. "Wheaton is proud to support Gen Mining in the responsible development of the Marathon Project, recently projected to have one of the lowest operational carbon footprints of any mine in the world, once producing. While Wheaton will be streaming the byproduct platinum and gold from the mine, the primary metals the Marathon Project is forecast to produce are palladium and copper, which are crucial for the global transition to a low-carbon economy."
MARATHON PMPA TRANSACTION DETAILS
- Under the Marathon PMPA, Wheaton will purchase
100% of the payable gold production until 150 thousand ounces ("koz") have been delivered, thereafter dropping to67% of payable gold production for the life of the mine and22% of the payable platinum production until 120 koz have been delivered, thereafter dropping to15% for the life of mine. - Wheaton will pay Gen Mining a total upfront cash consideration of C
$240 million , C$40 million of which will be paid on an early deposit basis prior to construction to be used for development of the Marathon Project, with the remainder payable in four staged installments during construction, subject to various customary conditions being satisfied and pre-determined completion tests1. - Wheaton will make ongoing payments for the gold and platinum ounces delivered equal to
18% of the spot prices ("Production Payment") until the value of gold and platinum delivered less the Production Payment is equal to the upfront consideration of C$240 million , at which point the Production Payment will increase to22% of the spot prices. - Gen Mining and certain of its subsidiaries, including the owner of the Marathon Project, will provide Wheaton with corporate guarantees and other security over their assets.
- Completion of the Marathon PMPA is subject to the closing of Gen Mining's acquisition of the remaining
16.5% interest in the Marathon Project from Sibanye Stillwater Limited, as announced by Gen Mining on December 8, 2021. - The first advance of the early deposit under the Marathon PMPA is expected to occur early in 2022, subject to the completion of certain corporate matters and customary conditions.
MARATHON PROJECT OVERVIEW
- The Marathon Project is forecast to be high-margin palladium mine with a 13-year mine life2.
- Attributable production once the mine and mill are fully ramped up is forecast to average over 16 koz of gold and 14 koz of platinum per year for the first five years of production, and approximately 15 koz of gold and 11 koz of platinum per year for the first ten full years2.
- Gen Mining anticipates construction activities to begin in 2022, with production commencing in 2024.
- Significant exploration potential exists within Gen Mining's strategic land package which covers over 220 km2, including the 25 kms of strike length along the Eastern Gabbro series that hosts the Marathon and Sally deposits and multiple prospects including Biiwobik, Four Dams, Skipper, Boyer and Redstone. Gen Mining's exploration potential also includes the Geordie deposit which is part of the Trans Coldwell Group and is hosted within the center of the Complex3.
- Subsequent to the closing of this acquisition, the Marathon Project will add to Wheaton's estimated Proven and Probable gold reserves by 0.26 Moz and platinum by 0.17 Moz, Measured and Indicated gold resources by 0.18 Moz and platinum by 0.10 Moz, and Inferred gold resources by 0.04 Moz and platinum by 0.02 Moz.
FINANCING THE TRANSACTION
As at September 30, 2021, the Company had approximately US
ABOUT GENERATION MINING AND THE MARATHON PROJECT
Gen Mining's focus is the development of the Marathon Project, a large undeveloped platinum group metals deposit in Northwestern Ontario. Gen Mining released the results of its Feasibility Study on March 3, 2021 and published the NI43-101 Technical Report dated March 25, 2021. On December 13, 2021, an independent report prepared by Skarn Associates estimated the Marathon Project, once producing, to be ranked as having one of the lowest operational carbon footprints for a mine in both Canada and the world per tonne of copper-equivalent produced. The Marathon property covers a land package of approximately 22,000 hectares, or 220 square kilometres. Gen Mining has announced that it has entered into a binding arrangement to acquire the remaining
Attributable Gold Mineral Reserves and Mineral Resources – Marathon Project
Category | Tonnage | Grade | Contained | |
Proven | 85.1 | 0.07 | 0.19 | |
Probable | 32.6 | 0.06 | 0.06 | |
P&P | 117.7 | 0.07 | 0.26 | |
Measured | 19.4 | 0.08 | 0.05 | |
Indicated | 66.6 | 0.06 | 0.13 | |
M&I | 86.0 | 0.07 | 0.18 | |
Inferred | 22.7 | 0.05 | 0.04 |
Attributable Platinum Mineral Reserves and Mineral Resources – Marathon Project
Category | Tonnage | Grade | Contained | |
Proven | 18.7 | 0.2 | 0.13 | |
Probable | 7.2 | 0.2 | 0.04 | |
P&P | 25.9 | 0.2 | 0.17 | |
Measured | 4.4 | 0.2 | 0.03 | |
Indicated | 15.0 | 0.1 | 0.07 | |
M&I | 19.4 | 0.2 | 0.10 | |
Inferred | 5.1 | 0.1 | 0.02 |
Notes on Mineral Reserves & Mineral Resources:
- All Mineral Reserves and Mineral Resources have been estimated in accordance with the 2014 Canadian Institute of Mining, Metallurgy and Petroleum (CIM) Standards for Mineral Resources and Mineral Reserves and National Instrument 43-101 – Standards for Disclosure for Mineral Projects ("NI 43-101").
- Mineral Reserves and Mineral Resources are reported above in millions of metric tonnes ("Mt"), grams per metric tonne ("g/t") and millions of ounces ("Moz").
- Qualified persons ("QPs"), as defined by the NI 43-101, for the technical information contained in this document (including the Mineral Reserve and Mineral Resource estimates) are:
- Neil Burns, M.Sc., P.Geo. (Vice President, Technical Services); and
- Ryan Ulansky, M.A.Sc., P.Eng. (Vice President, Engineering)
both employees of the Company (the "Company's QPs"). - The Mineral Resources reported in the above tables are exclusive of Mineral Reserves. Generation report Mineral Resources inclusive of Mineral Reserves. The Company's QPs have made the exclusive Mineral Resource estimates for the mine based on average mine recoveries and dilution.
- Mineral Resources, which are not Mineral Reserves, do not have demonstrated economic viability.
- Marathon Project Mineral Reserves are reported as of September 15, 2020 and Mineral Resources as of June 30, 2020.
- Marathon Project Mineral Reserves are reported above an NSR cut-offs ranging from of CAD
$18.00 per tonne to CAD$21.33 per tonne assuming US$1,500 per ounce palladium, US$900 per ounce platinum, US$2.75 per pound copper, US$1,300 per ounce gold and US$16.00 per ounce silver. - Marathon Project Mineral Resources are reported above an NSR cut-off of CAD
$13.00 per tonne assuming US$1,600 per ounce palladium, US$900 per ounce platinum, US$3.00 per pound copper, US$1,500 per ounce gold and US$18.00 per ounce silver. - The Marathon PMPA provides that Generation will deliver
100% of the gold production until 150 thousand ounces are delivered and67% thereafter for the life of the mine and22% of the platinum production until 120 thousand ounces are delivered and15% thereafter for the life of the mine. Attributable reserves and resources have been calculated on the100% /67% basis for gold and22% /15% basis for platinum.
Neil Burns, P.Geo., Vice President, Technical Services for Wheaton Precious Metals and Ryan Ulansky, P.Eng., Vice President, Engineering, are a "qualified person" as such term is defined under National Instrument 43-101, and have reviewed and approved the technical information disclosed in this news release (specifically Mr. Burns has reviewed mineral resource estimates and Mr. Ulansky has reviewed the mineral reserve estimates).
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1) All amounts will be paid in US$ calculated in reference to the C$ amounts set out above. |
2) Based on report entitled "Feasibility Study: Marathon Palladium & Copper Project, Ontario, Canada" with an effective date of March 3, 2021. Production forecasts contain forward looking information and readers are cautioned that actual outcomes may vary. Please see "Cautionary Note Regarding Forward Looking-Statements" at the end of this news release for material risks, assumptions, and important disclosure associated with this information. |
3) The Marathon PMPA area of interest includes the strategic land package until certain thresholds are reached, after which the area of interest is reduced to the current Marathon leases. |
CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS
This press release contains "forward-looking statements" within the meaning of the United States Private Securities Litigation Reform Act of 1995 and "forward-looking information" within the meaning of applicable Canadian securities legislation concerning the business, operations and financial performance of Wheaton and, in some instances, the business, mining operations and performance of Wheaton's precious metals purchase agreement ("PMPA") counterparties. Forward-looking statements, which are all statements other than statements of historical fact, include, but are not limited to, payment by Wheaton of C
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SOURCE Wheaton Precious Metals Corp.
FAQ
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