VANCOUVER — As traditional forms of equity and debt finance have become untenable for mining companies, there’s been a rise in stream agreements, which typically offer miners access to cash for a percentage of future by-product metal production. And according to analysts at Scotia Capital there could be at least a few more high profile streaming deals on the horizon, as large, diversified miners look to improve balance sheets in the face of tough commodity markets.
Streaming deals tend to be suited for bulk tonnage, base metal mines with precious metal by-product credits that a growing group of financiers will buy for big money. Major players with chips in the game include Franco-Nevada (TSX: FNV; NYSE: FNV), Silver Wheaton (TSX: SLW; NYSE: SLW) and Royal Gold (TSX: RGL; NASDAQ: RGLD).
Due to the lack of equity dilution and minimal direct burdens on balance sheets, these agreements are becoming increasingly popular with large mining companies with diverse portfolios looking to raise capital amidst depressed share prices and rising debt loads.
The most recent executive to tout the benefits of potential stream deals …
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