Wheaton and BHP Sign World’s Largest Precious Metals Stream
Antamina deal underpins strong Wheaton growth forecast
BHP (ASX: BHP) and Wheaton Precious Metals Corp (ASX: WPM) have entered into a long-term streaming agreement over the Antamina copper operation in Peru.
BHP owns 33.75% of the mine alongside Glencore (LSE: GLEN), Teck Resources (TSX: TECK) and Mitsubishi Corporation (TYO: 8058).
Wheaton already has a silver stream over Glencore’s 33.75% stake, taking the total silver received to 67.5%.
BHP will receive an upfront payment of US$4.3 billion in exchange for BHP’s share of silver production from Antamina.
Speaking to reporters on Tuesday, BHP chief financial officer Vandita Pant said the upfront consideration compared favourably with consensus estimates of the company’s entire share of Antamina.
“We have a big capital base and lots of assets, so the way we think about this is that if there is any asset that we have which some other party will give us more value for, we should do that because it maximises value for our shareholders,” she said.
BHP’s share of silver production from Antamina in 2025 was 5.4 million ounces.
Pant said silver was considered non-core for BHP and was not valued by analysts in its portfolio.
“This is the world’s largest streaming transaction ever done for a precious metal,” she said.
“So, we have been very sharp and agile in using this very positive landscape of high silver prices to get so much value for our shareholders.”
BHP gold streams unlikely
BHP was questioned by analysts over whether it may look to do similar streaming deals for gold given it is a top 20 global gold producer via by-products.
Its South Australian copper division produced 400,000 ounces of gold last year, making it a top five ASX producer.
The Vicuña project in Argentina, a 50:50 joint venture between BHP and Lundin Mining Corporation (TSX: LUN), hosts a resource of 92Moz and is expected to produce 700,000oz per year of gold, alongside copper and silver, making it a top five global producer.
Henry said the company would like to see gold fully valued in BHP’s portfolio.
“However, if you think about the silver stream that we’ve done at Antamina, silver is a much smaller part of the portfolio than gold is, and secondly, we know that we’re at risk of giving up material upside at Antamina, because we largely know what the production profile from here looks like,” he said.
“The challenge that we have with gold is that it’s an asset where the upside is still not quite known.”
BHP is planning to expand production at Copper South Australia to 500,000tpa of copper and potentially to 1Mpta.
“But the resource is so large, who knows where it goes from there? And same thing with Vicuña,” Henry said.
“So, any consideration of a gold stream, it gets tempered by the fact that it’s more of a core asset for us, and secondly, we would be at greater risk of giving up upside and later coming to regret having done it.”
Wheaton growing
Wheaton will fund the deal via a combination of cash on hand of roughly US$1.9 billion and a new US$1.5 billion term loan credit facility and an approximate US$900,000 million draw on the company’s existing undrawn US$2 billion revolving credit facility.
Net debt at closing of the acquisition is currently expected to be approximately US$2.4 billion.
Alongside the deal, Wheaton reported 2025 production of 692,000 gold equivalent ounces, exceeding the upper end of the 2025 production guidance range of 670,000 GEOs.
“The momentum we built over the past year provides a solid foundation for what we expect to be a sector-leading growth profile,” Wheaton CEO Randy Smallwood said.
“We believe Wheaton is on track to reach unprecedented levels of precious metals production within the streaming space.
“With the most precious metals-focused portfolio in the industry, the strength of our projected growth profile, and rising demand for streaming capital, we believe Wheaton is exceptionally well positioned to continue delivering industry-leading growth.”
Wheaton expects production to rise by 11% this year to 860,000-940,000 GEOs, driven mainly by the Antamina stream, which will add 70,000 GEOs from April 1.
Further contributions from newly operating assets, including Blackwater, Mineral Park, Fenix, Hemlo, Goose and Platreef will be partially offset by lower production from Constancia and Salobo.
The company expects to generate more than US$3.2 billion in cashflow this year.
Longer-term, Wheaton forecasts growth of roughly 50% to 1.2 million GEOs by 2030.
The outlook is underpinned by forecast production increases at Antamina, Blackwater, Aljustrel, Marmato, Hemlo and Goose; as well as new production from development assets including Koné, Fenix, Kurmuk, Platreef, Mineral Park and El Domo; and permitted pre-development assets including the Spring Valley, Copper World and Santo Domingo projects.
The company has an additional 11 assets, including El Alto, Navidad and Toroparu, not included in the outlook.