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The cost of stream financing for copper miners

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Report summary

Project financing through streaming and royalty contracts was fairly inconsequential in 2004. Since then, these contracts have cumulatively injected US$10.3 billion into the mining sector. When considering mines affected by a streaming or NSR contract (roughly 5% of our copper mine coverage, or 2Mlb) we conclude that at the C1 cash cost level, the inclusion of streaming contracts results in a 15c/lb paid Cu increase in costs due to the lower net revenue received from precious metals.

What's included

This report contains

  • Document

    The cost of stream financing for copper miners

    PDF 449.77 KB

Table of contents

Tables and charts

This report includes 10 images and tables including:

Images

  • The cost of stream financing for copper miners: Image 1
  • Degree of contract leverage to metal price changes (Bull versus Bear case scenario)
  • Relationship between life of contract (LoC) yields and capital raised from 2004 until 2015
  • C1 cash cost sensitivity for mines affected by stream financing
  • C3 cost sensitivity for mines affected by streaming and royalty financing
  • Indexed price performance of the major stream/royalty financiers compared with copper and gold miners

Tables

  • Base case metal price assumptions
  • Bear case metal price assumptions
  • Bull case metal price assumptions
  • Valuations for 31 streaming and royalty contracts – valued under our base case scenario

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