July 12, 2020 / 2:47 PM / a month ago

Canada's Triple Flag, China's CMOC agree to streaming deal for Australian mine

(Reuters) - Mine financing company Triple Flag Precious Metals Corp said on Sunday it has agreed to pay $550 million upfront as part of a streaming financing deal with China Molybdenum Co Ltd (603993.SS) (CMOC) for future production of precious metals at CMOC’s Northparkes mine in Australia.

Streaming transactions are a type of alternative financing in the mining industry where funds are provided upfront to a miner in exchange for the sale of a fixed amount of future production of metals at a discounted price.

The deal, between units of the two companies, gives Triple Flag rights to a majority of gold and silver to be produced at the mine in New South Wales until the Toronto-based company receives 630,000 ounces of gold and 9 million ounces of silver.

Thereafter, Elliott Management-backed Triple Flag would continue to receive less than half of the gold and silver produced at the mine.

On top of the $550 million upfront payment, Triple Flag would also pay CMOC 10% of the spot gold and spot silver price for each ounce at the time of each delivery.

Reporting by Ismail Shakil in Bengaluru; Editing by Aurora Ellis

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