Actionable news
0
All posts from Actionable news
Actionable news in FNV: FRANCO-NEVADA CORPORATION,

Franco Nev: Suite 2000, Commerce Court West

The following excerpt is from the company's SEC filing.

199 Bay Street

Toronto, Ontario M5L 1G9

Item 2

Date of Material Change

October 7, 2015

Item 3

News Release

A news release was issued through CNW Group on October 7, 2015 and a copy was subsequently filed on SEDAR.

Item 4

Summary of Material Change

On October 7, 2015, the Company announced that it has

agreed to acquire a silver stream on production from the Antamina mine in Peru from Teck Resources Limited (

). The Company announced that it has finalized the terms of a replacement precious metals stream agreement for First Quan tum Minerals Ltd.s (

) Cobre Panama project.

Item 5

Full Description of Material Change

5.1 Full Description of Material Change

Antamina Mine

agreed to acquire a silver stream on production from the Antamina mine in Peru from Teck. Teck owns a 22.50% interest in Compania Miñera Antamina S.A. (

), the Antamina joint venture company, along with partners BHP Billiton Plc (33.75%), Glencore Plc (33.75%) and Mitsubishi Corporation (10.00%).

In accordance with the silver stream agreement (the

Agreement

), a wholly-owned Canadian subsidiary of the Company made a one-time US$610 million advance payment to Teck on October 9, 2015. T

he first silver delivery to the Company is due in fourth quarter 2015.

The stream will be based on all recovered silver from Tecks attributable 22.50% interest in the Antamina mine, subject to a fixed silver payability of 90%. The Company will pay 5% of the spot silver price for each ounce of silver delivered under

the stream. Silver deliveries are scheduled for the 45th day after each calendar quarter and based on the previous quarters concentrate shipments. The obligation to deliver silver will be a joint and several obligation between Teck as well as a single-purpose, debt free entity holding Tecks direct interest in CMA. Silver deliveries under the stream will be an absolute obligation of the joint sellers and are not contingent on the availability of cash flow from the project.

Under the terms of the Agreement, the stream will reduce by one-third after 86 million ounces have been delivered under the Agreement, estimated at current throughput to be approximately 30 years.

Antamina is a well-established producing copper mine that has been in production since 2001 and is one of the lowest cost copper mines in the world. The deposit is a polymetallic skarn with associated regional porphyry mineralization. The mine has reserves of 647 million tonnes grading 0.94% copper, 0.98% zinc and 10.7 g/t silver and measured and indicated resources (inclusive of reserves) of 1,136 million tonnes grading 0.89% copper, 0.82% zinc and 10.6 g/t silver. Inferred resources at the project are 1,280 million tonnes grading 0.84% copper, 0.66% zinc and 11.4 g/t silver.

Beyond the known reserves and resources, Antamina hosts additional potential open-pit and bulk/selective underground targets. There is also regional exploration potential over a large, prospective land package greater than 700 km

The mine is an open pit operation processing approximately 150,000 tonnes per day using conventional flotation, located in the Peruvian Andes 270 km north-east of Lima, at an elevation of approximately 4,000 meters. It employs over 3,000 people and is owned and operated by CMA. In 2014, Antamina produced approximately 345,000 tonnes of copper, 211,000 tonnes of zinc, 3.1 million pounds of molybdenum and 12.0 million ounces of silver (with associated bismuth and lead).

Concentrates are pumped via a 302 km pipeline to the Huarmey Port on the Pacific Coastline (300 km north of Lima) for shipping. The pipeline and port facilities are wholly owned and operated by CMA. Antamina produces separate copper, zinc, molybdenum and lead/bismuth concentrates, with silver predominantly contained within the copper concentrates, with additional silver contained within the lead-bismuth concentrate.

Current measured and indicated resources are sufficient to support over 20 years of open pit mining. The Company remains exposed to any future throughput expansions as well as regional exploration potential (on existing CMA concessions) without further capital or funding commitments.

The effective date for the transaction is July 1, 2015 and the Company is expected to receive 900,000 1,100,000 ounces of silver (12,300 15,000 Gold Equivalent Ounces (

) in the fourth quarter 2015. Annual silver stream contributions are expected to average 2.8 3.2 million ounces going forward (38,200 43,600

), with 2016 and 2017 silver deliveries expected to be above average. Based on current expectations, and assuming spot commodity prices, Antamina would increase the Companys GEOs and operating cash flow by approximately 13% and 18%, respectively.

Cobre Panama Commitment

On October 7, 2015, the Company finalized the terms of a replacement precious metals stream agreement for First Quantums Cobre Panama project. Under the terms of the revised agreement, Franco-Nevada (Barbados) Corporation (

) will provide a US$1 billion deposit against future deliveries of the gold and silver from Cobre Panama. This deposit will be funded on a pro-rata basis of 1:3 with First Quantums 80% share of the capital costs in excess of US$1 billion. Execution of the revised...


More