BHP, Wheaton sign $4.3bn silver streaming deal in Peru

Core Viewpoint - BHP has entered into a long-term streaming agreement with Wheaton Precious Metals, involving a $4.3 billion upfront payment for silver from its share of production at the Antamina mine in Peru, allowing BHP to monetize its silver assets while maintaining its interests in other minerals [1][2][3]. Group 1: Agreement Details - BHP holds a 33.75% stake in Compañía Minera Antamina, and the new agreement does not change its shareholder rights or existing customer agreements [2]. - Under the terms, BHP will deliver 33.75% of the silver produced from Antamina at a payable rate of 90% until 100 million ounces are delivered, after which the rate will decrease to 22.5% for the remaining mine life [2]. - Wheaton will pay 20% of the spot silver price for each ounce delivered under the agreement, which will take effect on April 1, 2026, with completion expected around the same date [3]. Group 2: Financial Implications - BHP plans to use the capital from this deal to enhance shareholder value by reallocating funds towards high-return projects and returns, with no expected increase in reported debt levels as a result of the transaction [3]. - BHP reported a strong operational performance for the recent half-year, with revenue increasing by $2.7 billion, driven by higher copper and iron ore prices [5]. - The company's underlying earnings before interest, taxes, depreciation, and amortization saw a 25% uplift, with copper contributing 51% to this increase, reaching $8 billion [5]. Group 3: Management Commentary - BHP CEO Mike Henry expressed satisfaction in partnering with Wheaton, highlighting that the investment in Antamina has provided value to investors through strong copper production and that the agreement unlocks additional value from the asset [4].