VANCOUVER, BC, Feb. 8, 2022 /CNW/ - Wheaton Precious Metals™ Corp. ("Wheaton" or the "Company") is pleased to announce that it has entered into a definitive Precious Metal Purchase Agreement (the "Agreement") with Sabina Gold & Silver Corp. ("Sabina") (TSX: SBB) in respect to the Goose Project, part of Sabina's 100% owned Back River Gold District located in Nunavut, Canada (the "Goose Project"). The Goose Project is forecast to be a high margin mine in the lowest half of the gold cost curve with a 15-year mine life1.

"The Goose Project in the Back River Gold District in Nunavut provides Wheaton with an exceptional opportunity to expand our portfolio into one of Canada's strongest and fastest-growing mining jurisdictions," said Randy Smallwood, Wheaton's President and Chief Executive Officer. "Underscored by a respectful development approach and calculated de-risking through sound environmental and social responsibility mandates, we are proud to partner with Sabina on the advancement of this project."

TRANSACTION DETAILS

Upfront Payment: Wheaton will pay Sabina an upfront payment of US$125 million in four equal installments during construction of the Goose Project, subject to customary conditions.
Streamed Metal: Wheaton will be entitled to receive 4.15% of the payable gold production from the Mine dropping to 2.15% of the payable gold production from the Mine after delivery of 130,000 ounces of gold and dropping to 1.5% of the payable gold production from the Mine after delivery of 200,000 ounces of gold.
Production Profile 1 : With a fixed payable rate of 99.98%, attributable gold production is forecast to average 11.7 koz per year for the first five full years of production, and 10.7 koz per year for the first ten full years. Sabina is finalizing its 2022 work program and expects production to commence in the first quarter of 2025.
Production Payments: Wheaton will make ongoing production payments for gold ounces delivered equal to 18% of the spot gold price until the value of gold delivered less the cumulative production payments is equal to the upfront consideration of US$125 million, at which point the production payment will increase to 22% of the spot gold price.
Incremental Reserves and Resources 2 : The addition of the Goose Project will increase Wheaton's estimated Proven and Probable gold reserves by 0.14 Moz, Measured and Indicated gold resources by 0.03 Moz and Inferred gold resources by 0.04 Moz. Significant exploration upside potential exists within the Goose Project with over 4 km of untested plunge length to be explored within over 15,000 hectares of mineral claims and leases.
Community Investment Support: As part of the Agreement, Sabina is eligible for additional community support through Wheaton's Partner CSR Program which provides financial support for its mining partners' economic, environmental and social initiatives within the communities that are directly influenced by the mines.
Other Considerations:
Wheaton has a right of first refusal on any future streaming agreement, royalty agreement or similar transaction entered into by Sabina or any of its affiliates relating to production of any precious metal from the Goose Project.
Security provided in respect of the Agreement will be subordinate to project debt and other customary permitted liens, and pari passu with certain other debt.
Under certain circumstances, Sabina has the option of deferring delivery of gold ounces to Wheaton if the average market price of gold falls below US$1,500 per ounce during a period of at least 180 days.
Until the Agreement parameters are met, Sabina has a one-time option to repurchase 33% of the gold stream on a change in control for an amount ensuring a fixed internal rate of return to Wheaton.
Wheaton also intends to provide up to US$20M in equity to Sabina, subject to remaining below 10% of the outstanding shares of Sabina.
INCREASE TO WHEATON'S LONG-TERM GUIDANCE

As a result of the Agreement and the forecast addition of attributable production from the Goose Project, Wheaton is increasing its ten-year production guidance to 910,000 gold equivalent ounces[3] ("GEOs") from 900,000 GEOs. 2022 and five-year guidance remain unchanged at 700,000 to 760,000 GEOs in 2022 and 850,000 GEOs on average for the next five years.

FINANCING THE TRANSACTION

The Upfront Payment will be paid over the construction of the Goose Project, coinciding with the start of construction. As at September 30, 2021, the Company had approximately US$372 million of cash on hand, 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 SABINA AND THE GOOSE PROJECT

Sabina Gold & Silver Corp. is an emerging precious metals company with district scale, advanced, high grade gold assets in Nunavut, Canada.

The Goose Project is the first mine Sabina is advancing in its 100%-owned Back River Gold District, which is an 80km long belt with a series of gold deposits in banded iron formation, located in southwestern Nunavut, Canada, approximately 520 km northeast of Yellowknife. The Goose Project is an advanced and fully permitted project with social license in hand. Pre-development activities have begun with the Project's Port Facility and winter ice road being completed as well as major earth works at the Goose Project site.

Attributable Gold Mineral Reserves and Mineral Resources – Goose Project

Category Tonnage Mt Grade Au g/t Contained Au Moz

Proven 0.3 5.54 0.06
Probable 0.4 6.29 0.09
P&P 0.8 5.97 0.14

Measured 0.04 4.94 0.01
Indicated 0.1 5.18 0.02
M&I 0.2 5.13 0.03
Inferred 0.2 6.64 0.04

Notes on Mineral Reserves & Mineral Resources:
1.
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").

2.
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").

3.
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:

a.
Neil Burns, M.Sc., P.Geo. (Vice President, Technical Services); and

b.
Ryan Ulansky, M.A.Sc., P.Eng. (Vice President, Engineering),
both employees of the Company (the "Company's QPs").

4.
The Mineral Resources reported in the above tables are exclusive of Mineral Reserves. Sabina 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.

5.
Mineral Resources, which are not Mineral Reserves, do not have demonstrated economic viability.

6.
Goose Project Mineral Reserves are reported as of January 15, 2021 and Mineral Resources as of December 31, 2020.

7.
Goose Project Mineral Reserves are reported above the following undiluted gold cut-off grades assuming a gold price of $1,500 per ounce:
a.
Umwelt – 1.72 grams per tonne for open pit and 3.9 grams per tonne for underground
b.
Llama – 1.74 grams per tonne for open pit and 4.1 grams per tonne for underground
c.
Goose Main – 1.70 grams per tonne for open pit and 4.1 grams per tonne for underground
d.
Echo – 1.60 grams per tonne for open pit and 3.5 grams per tonne for underground
8.
Goose Project Mineral Resources are reported above a gold cut-off of 1.4 grams per tonne for open pit and 3.0 grams per tonne for underground for all deposits, assuming a gold price of $1,550 per ounce.
9.
The Goose PMPA provides that Sabina will deliver 4.15% of the payable gold production, dropping to 2.15% after delivery of 130,000 ounces of gold and dropping to 1.5% after delivery of 200,000 ounces of gold. Attributable gold reserves and resources have been calculated on the 4.15% / 2.15% / 1.5% basis.

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).

______________________________

1) 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. Based on report entitled "National Instrument (NI) 43-101 Technical Report: 2021 Updated Feasibility Study for the Goose Project at the Back River Gold District, Nunavut, Canada" with an effective date of January 15, 2021. Production forecasts contain forward looking information and readers are cautioned that actual outcomes may vary. S&P data set for 2024 projected global cost curves.

2) Please refer to the Attributable Mineral Reserves & Mineral Resources table in this news release for full disclosure of reserves and resources associated with the Santo Domingo project including accompanying footnotes.

3) Gold equivalent forecast production for 2022 and the longer term outlook are based on the following updated commodity price assumptions: $1,800 per ounce gold, $24 per ounce silver, $2,100 per ounce palladium, $1,000 per ounce of platinum and $33.00 per pound cobalt. For complete details regarding Wheaton's production guidance, refer to Wheaton's news release dated February 7, 2022, titled "Wheaton Precious Metals Meets 2021 Production Guidance and Forecasts 20% Long-Term Growth."

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 etc etc..

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SOURCE Wheaton Precious Metals Corp.
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