Impact: Positive
Electric Royalties announced that it has acquired a copper stream on the Minera Cobre Verde mine, located in the Antofagasta region of Chile. As per the terms, Electric Royalties is expected to pay US$2.1M to acquire 76,000 lbs of Cu monthly, for four years at a fixed copper price of US$2.75/lb. It can double the amount of the stream by paying an additional US$2.1M, within 30 days of the transaction closing. We believe this stream is a positive addition to Electric Royalty’s portfolio because it is expected to generate ~US$1-2M in annual revenue per year based on the copper price, translating to ~50-100% ROI. Additionally, it provides direct exposure to potential copper price appreciation and a cash flow cushion, while other advanced royalties in its portfolio prepare to begin production over the next six months to four years. This is the first stream agreement and third producing mine in Electric Royalty’s portfolio of over 40 royalties.
