CAPITAL MARKETS

Franco-Nevada gains another Cobre Panama stream for US$178 million

Gold royalty and streaming company Franco-Nevada (CN:FNV) is set to have precious metal stream interests covering 100% of the ownership of the large-scale Cobre Panama project after striking a US$178 million agreement with Korea Resources Corp (KORES) over its 10% interest.

Staff reporter
Project expected to “add materially” to company’s growth profile

Project expected to “add materially” to company’s growth profile

Franco-Nevada said the terms were the same as the $178 million precious metals stream it signed in September with First Quantum Minerals' (CN:FM) to help it fund the acquisition of a further 10% of Cobre Panama from LS-Nikko Copper.

Franco-Nevada said it expected to fund the combined $356 million without a syndication partner after CEF Holdings, previously named as a possible one-third partner, was unable to put a suitable structure in place to participate.

The company has an existing precious metals stream over First Quantum's 80% interest in Cobre Panama and had funded $727 million of that $1 billion commitment by the end of 2017.

The incremental 20% stream differs because Franco-Nevada is funding the full amount upfront and the ongoing payment for deliveries is based on a percentage of the spot price.

The $5.5 billion development project in Panama has overcome logistical challenges and is about 60% complete, and expected to produce about 300,000 tonnes per annum of copper over a 40-year mine life.

Franco-Nevada CEO David Harquail said phased commissioning was expected later this year and Cobre Panama was expected to "add materially" to the streaming company's growth profile from 2019.

Franco-Nevada shares dropped 3.42% to C$94.51 yesterday, a mid-point in its 52-week range.

A growing series of reports, each focused on a key discussion point for the farming sector, brought to you by the Kondinin team.

A growing series of reports, each focused on a key discussion point for the farming sector, brought to you by the Kondinin team.

editions

Mining Journal Intelligence Investor Sentiment Report 2024

Survey revealing the plans, priorities, and preferences of 120+ mining investors and their expectations for the sector in 2024.

editions

Mining Journal Intelligence Mining Equities Report 2023

Access an exclusive, inside look on the quarterly mining IPOs and secondary raisings data and mining equities performance tables with an annual Stock Exchange Comparisons supplement.

editions

Mining Journal Intelligence World Risk Report 2023 (feat. MineHutte ratings)

A detailed analysis of mining investment risks across 121 jurisdictions globally, built on 11 ‘hard risk’ metrics and an industrywide survey.

editions

Mining Journal Intelligence Global Leadership Report 2023: Social licence

Gain insights into social licence trends and best practices from interviews with 20+ top mining company executives and an industrywide survey.