VANCOUVER, BC, Dec. 13, 2021 /CNW/ - Wheaton Precious Metals™ Corp. ("Wheaton" or the "Company") is pleased to announce that it has entered into a definitive agreement to acquire the existing gold stream (the "Gold Stream") held by New Gold Inc. ("New Gold") in respect of gold production from the Blackwater Gold Project located in British Columbia, Canada (the "Blackwater Project"). In addition, the Company has entered into a Precious Metal Purchase Agreement (the "Silver Stream") with Artemis Gold Inc. ("Artemis") (TSX: ARTG) in respect of silver production from the Blackwater Project.

"The acquisition of the gold and silver streams on the Blackwater Project further enhances and diversifies Wheaton's existing portfolio of low-cost, high-quality, long-life mines. With strong ESG commitments at every stage of development, compelling economics and significant exploration upside potential, Blackwater incorporates many of the attributes we seek for accretive growth," said Randy Smallwood, Wheaton's President and Chief Executive Officer. "Artemis's approach of disciplined, responsible resource development aligns well with our own focus on promoting industry-leading mining practices. We are proud to partner with Artemis in the advancement of the Blackwater Project, which we believe is on track to develop into a top-tier operation, producing socially and environmentally sound minerals, right in our own backyard."

TRANSACTION DETAILS

Upfront Consideration: Wheaton will pay total upfront consideration of US$441 million for the precious metal streams. Upon closing of the purchase of the Gold Stream, Wheaton will pay New Gold US$300 million. Under the Silver Stream, Wheaton will pay Artemis total upfront cash consideration of approximately US$141 million, which is payable in four equal installments during construction of the Blackwater Project, subject to customary conditions being satisfied.

Streamed Metal: Under the Gold Stream, Wheaton will be entitled to receive 8% of the payable gold production until 279,908 ounces have been delivered, thereafter dropping to 4% of payable gold production for the life of the mine. Under the Silver Stream, Wheaton will be entitled to receive 50% of the payable silver production until 17.8 million ounces ("Moz") have been delivered, thereafter dropping to 33% of payable silver production for the life of the mine.

Delivery Payments: For gold ounces delivered, Wheaton will make ongoing cash payments equal to 35% of the spot gold price. For silver ounces delivered, Wheaton will make ongoing cash payments ("Silver Production Payment") equal to 18% of the spot silver price until the value of silver delivered less the Silver Production Payment is equal to the upfront cash consideration, at which point the Silver Production Payment will increase to 22% of the spot silver price.

Production Profile1: Attributable gold production is forecast to average approximately 26 koz per year for the first five full years of production and 28 koz per year for the first ten full years. With a fixed silver recovery of 61%, attributable silver production is forecast to average over 480 koz per year for the first five full years of production, and over 670 koz per year for the first ten full years.

Incremental Reserves and Resources2: The Gold and Silver Streams will increase Wheaton's estimated Proven and Probable gold reserves by 0.47 Moz and silver reserves by 31.0 Moz, Measured and Indicated gold resources by 0.15 Moz and silver resources by 19.9 Moz, and Inferred gold resources by 0.01 Moz and silver resources by 2.3 Moz. In addition, Wheaton believes significant exploration upside potential exists as the Blackwater Project deposit remains open to the North, Northwest and at depth, and given the Gold Stream's substantial area of interest.

Other Considerations:
Artemis and certain of its subsidiaries will provide Wheaton with corporate guarantees and other security.
Artemis has waived its right of first offer with respect to the purchase of the Gold Stream. New Gold has waived its right of first refusal with respect to the Silver Stream.
FINANCING THE TRANSACTION

The $300 million acquisition price for the Gold Stream will be paid on closing of the purchase agreement. The $141 million upfront deposit under the Silver Stream will be paid over the construction of the Blackwater Project. As at September 30, 2021, the Company had approximately US$372 million of cash on hand, which 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 all outstanding commitments and known contingencies as well as providing flexibility to acquire additional accretive mineral stream interests.

ABOUT ARTEMIS AND THE BLACKWATER PROJECT

Artemis is a gold development company with a technically driven approach to shareholder value creation through identifying, acquiring and developing gold projects in mining friendly jurisdictions using a disciplined staged approach to development, managing risks while minimizing cost of capital to optimize economics and returns for shareholders.

As disclosed by Artemis, the primary focus for Artemis is on advancing construction of the Blackwater Project, a project with 8 million ounces of gold in reserves, Environmental Assessment approval and the potential to develop into one of the largest gold mines in Canada. The Blackwater Project is forecast to be a first quartile gold mine3 with a 22 year mine life1. Artemis has disclosed that it expects major construction to commence in the second quarter of 2022, with production commencing in the first quarter of 2024.

Attributable Gold Mineral Reserves and Mineral Resources – Blackwater

Category
TonnageMt
GradeAu g/t

Contained
Au Moz Proven 19.3 0.74 0.46
Probable 0.5 0.80 0.01
P&P 19.8 0.74 0.47
Measured 4.1 0.35 0.05
Indicated 6.4 0.49 0.10
M&I 10.5 0.44 0.15
Inferred 0.7 0.45 0.01

Attributable Silver Mineral Reserves and Mineral Resources – Blackwater

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