Alternative Financing Methods For Mineral Projects

Recent global uncertainties have impacted the metals and mining industry and as a result, it has become more difficult to obtain financing from traditional sources for the exploration and development of mineral projects. As a result, companies have been exploring a number of alternative financing methods, including metal stream financing, royalty financing and joint ventures.

Metal stream financing involves a long-term metal purchase and sale agreement between the financier and a mining company. In a typical streaming agreement, the financier provides the mining company with an upfront payment, or deposit, in exchange for the right to purchase at a fixed price a future stream of metal that will be produced from the applicable mining property. The agreement may pertain to the purchase and sale of a byproduct metal rather than the primary metal produced. The upfront deposit may be provided either all at once at closing or in stages as development objectives are