SolGold strikes $150 million streaming deal with Franco-Nevada

SolGold has reached a US$150 million net smelter return (NSR) agreement with Franco-Nevada for its Alpala copper-gold deposit, the main target in its Cascabel project in Ecuador.

The deal will see Franco-Nevada – which offers natural resource companies upfront cash in exchange for future production – provide an initial $100 million to the development of Alpala, in return for a perpetual 1% NSR.

The terms could then be extended by an additional $50 million at SolGold’s discretion, which would subsequently increase Franco-Nevada’s NSR up to 1.5%.

Franco-Nevada joins other majors with exposure to the Alpala project, including Australian giants BHP and Newcrest. Last year, BHP increased its ownership in SolGold to 15.31% – making it’s the largest sole shareholder in the company.

London and Toronto-listed SolGold said it will work on a feasibility study for Alpala in the coming months. The company believes it is part of one of the largest copper-gold porphyry systems ever discovered and expects to start production in 2025.

“SolGold is immensely excited to further progress Alpala in the run-up to final feasibility and a development decision, and for Franco-Nevada’s endorsement of the Alpala project,” said CEO Nicholas Mather.