BRITISH COLUMBIA

Silver Wheaton to extend deadlines in Pascua-Lama silver deal with Barrick

01/05/2015 07:59 EST | Updated 03/07/2015 05:59 EST
VANCOUVER - Silver Wheaton Corp. (TSX:SLW) has agreed to give Barrick Gold Corp. (TSX:ABX) an additional 2 1/2 years to meet a production milestone at the stalled Pascua-Lama mining project in South America.

Under the agreement, Silver Wheaton paid about US$625 million in cash in return for rights to silver produced by Barrick either at Pascua-Lama on the Chile-Argentina border or its other mines.

Construction of Pascua-Lama has been suspended while Barrick works to address environmental and local community issues.

Barrick now has until June 30, 2020, to reach at least 75 per cent of design capacity at Pascua-Lama. The previous deadline was Dec. 31, 2017, which was two year later than the original target of Dec. 31, 2015 when the deal was reach in 2013.

In the meantime, Silver Wheaton will now receive silver produced at three other Barrick mines (Lagunas Norte, Pierina, and Veladero mines) until March 31, 2018, rather than until the end of 2016 as previously agreed.

As of Sept. 30, Silver Wheaton had received 12 million ounces of silver from Barrick's other mines, representing US$275 million of cash flow.

Silver Wheaton also announced Monday that it has cancelled a silver stream agreement with Nyrstar Mining.