Franco-Nevada commits $352.5 million to Tocantinzinho gold project in Brazil

Gold streaming company Franco-Nevada has announced it will invest US$352.5 million in the Tocantinzinho gold project in Brazil, which is being developed by TSXV-listed G Mining Ventures.

Tocantinzinho is a construction-ready, low-cost conventional open pit mine and milling operation located in Brazil’s Pará State. First production is expected in the second half of 2024.

Franco-Nevada has agreed to acquire a $250 million gold stream on the project, in order to support its construction. The company will receive 12.5% of all gold produced until 300,000 ounces have been delivered, and 7.5% of gold produced for the remaining life of mine thereafter.

G Mining will receive 20% of the spot gold price for each ounce of gold delivered. Franco-Nevada will also have the option to purchase gold stream on additional properties with mining production processed through the Tocantinzinho facilities.

In addition to the gold stream, Franco-Nevada has agreed to provide a $75 million, six-year term loan to G Mining and subscribe for $27.5 million worth of the mining junior’s shares.

“Tocantinzinho is an attractive project in a prolific district and located in a good jurisdiction,” said Franco-Nevada president and CEO Paul Brink.

“The G Mining Ventures team has a track-record as one of the most capable mine building teams in the industry. As a stream financing partner we seek, through our financing and our involvement in projects, to help mine developers raise their full financial package on attractive terms.”