Operator: First Quantum Minerals Ltd.
Stream: Gold and Silver Stream
In October 2015, Franco-Nevada and First Quantum Minerals Ltd. (“First Quantum”) agreed to a replacement precious metals stream agreement on the Cobre Panama project.
Cobre Panama is one of the world’s largest copper-gold-silver porphyry deposits currently being constructed. The concession covers an area of 136 km2. Under the terms of the precious metals purchase agreement, Franco-Nevada will provide a maximum of $1 billion deposit pro-rata on a 1:3 ratio of First Quantum’s share of the capital costs (First Quantum owns 80% of the project). As of December 31, 2016, Franco-Nevada has provided $462 million and expects to provide additional funding of between $200-$220 million in 2017. The amount of precious metals deliverable under the precious metals purchase agreement is indexed to the copper in concentrate produced from the project and approximates 86% of the expected payable precious metals attributable to First Quantum. Beyond the initial contemplated mine life, the precious metals deliverable under the agreement will be based on a fixed percentage of the precious metals in concentrate.
Phased commissioning of Cobre Panama is planned in 2018 with ramp-up in 2019. First Quantum estimates that the overall project is over 46% complete as of December 2016 with the estimated total capital expenditure for the project unchanged from its early 2016 estimate of $5.48 billion. The power station and associated infrastructure have been prioritized for early completion starting in the second half of 2017. The January 2014 mine plan envisions a 34 year mine life with potential for further expansion.
|Total Revenue to FNV ($ million)