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Royal Gold picks up Chilean gold stream from Teck Resources

10th July 2015

By: Henry Lazenby

Creamer Media Deputy Editor: North America

  

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TORONTO (miningweekly.com) – Diversified miner Teck Resources on Friday agreed to sell future gold output from its Chile-based Carmen de Andacollo mine to Royal Gold.

Under the terms of the streaming deal, Royal Gold made a $525-million upfront payment to buy all the payable gold at 15% of the monthly average gold price at each delivery, until 900 000 oz had been delivered.

Teck’s subsidiary Compañia Minera Teck Carmen de Andacollo (CDA) paid $345-million to Royal Gold to terminate a five-year-old royalty agreement, which required CDA to pay Royal Gold 75% of payable gold up to 910 000 oz and 50% after that.

Vancouver-based Teck held a 90% stake in CDA, with Chile's State-owned ENAMI owning the balance.

The agreement was a $162-million boost to Teck’s balance sheet, which was important in this period of relatively low commodity prices and high capital spending.

Edited by Chanel de Bruyn
Creamer Media Senior Deputy Editor Online

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