Vancouver, British Columbia – Artemis Gold Inc. – November 16, 2021 (TSX-V: ARTG) (“Artemis” or the “Company”) is pleased to announce that it has received a Silver Stream offer to enter into a definitive Precious Metals Purchase Agreement (the “Silver Stream Agreement”) with Wheaton Precious Metals™ Corp. (“Wheaton”), in respect to the Company’s Blackwater Gold Project in British Columbia (“Blackwater” or “the Project”).
The letter of Offer, as well as a copy of the Silver Stream Agreement (“ROFR Offer”) has been submitted to New Gold Inc. (“New Gold”) as required under the terms of an agreement related to the purchase of Blackwater dated August 21, 2020, which serves to formally trigger a Right of First Refusal mechanism under that agreement. Under this mechanism, New Gold has 30 days from the date of delivery of the ROFR Offer to accept the ROFR Offer and offer identical terms as the Silver Stream Agreement from Wheaton. In the event the ROFR Offer is not exercised by New Gold, Artemis and Wheaton will be free to execute the Silver Stream Agreement within 120 days. The Silver Stream Agreement will be a subordinated secured obligation of the Company.
Under the terms of the Silver Stream Agreement, Wheaton will purchase 50% of the silver production from the mineral reserves of Blackwater until approximately 18 million ounces of silver have been delivered, after which the stream reduces to 33% of the silver production for the life of mine. Wheaton will make an up-front deposit payment in cash of approximately US$141 million, payable in tranches during the major works construction of the Project, subject to certain conditions. In addition, Wheaton will make ongoing payments equal to 18% of the spot silver prices until the up-front deposit payment is reduced to zero, and 22% of the spot silver prices thereafter.
The Silver Stream Agreement also contains a partial buy back option such that until the earlier of January 1, 2025 or the achievement of commercial production at Blackwater, Artemis will have a one-time option to repurchase up to 33% of the Silver Stream on a change of control for certain consideration.
The proceeds from the Silver Stream Agreement will be used by the Company to fund the advancement of the development and construction of the Project.
Steven Dean, Chairman and CEO commented, “This silver stream provides the capital along with our cash position to complement the project debt financing supporting the overall capital required for the development of our Blackwater project. The cost of capital underlying this stream is extremely competitive. Under the terms of this silver stream facility, Artemis retains full upside to initially 50% increasing to 67% (after delivery of approximately 18 million ounces of Silver) of the by-product silver production from Blackwater.
Wheaton is a first-tier streaming company with well recognized in-house technical competencies. Their offer to provide this stream financing adds further credibility to the technical and economic strengths of Blackwater”.
Further updates will be provided in due course.
On behalf of the Board of Directors,
ARTEMIS GOLD INC.
On behalf of the Board of Directors
“Steven Dean”
Chairman and Chief Executive Officer
For further information: Chris Batalha, CFO and Corporate Secretary, +1 (604) 558-1107.
