Triple Flag signs on the $53m line with Allied for two gold streams

Triple Flag Precious Metals has entered into definitive agreements for the acquisition of 3% gold streams on each of the Agbaou and Bonikro mines operated by Allied Gold Corp, for $53 million. 

The Agbaou and Bonikro producing gold mines are located in Côte d'Ivoire within the Birimian Greenstone Belt, are approximately 20 kilometres apart, and operated as a single complex. On a combined basis, Allied is targeting a production rate of 180,000oz-200,000ozpa and a greater than 10-year mine life from the complex, driven by an extensive exploration program. 

"The acquisition of new 3% gold streams on each of the Agbaou and Bonikro mines adds immediate cash flow to Triple Flag from two producing assets, with an operator that has already created significant value at these operations from exploration investments. We fully expect this exploration track record to continue and see significant upside potential for further growth in reserves and resources," Shaun Usmar, chief executive, said.

"This deal will be partially funded by our credit facility and is expected to achieve full payback within the minimum delivery period in the current gold price environment," he added.

Deal details

Under the terms of the deal, Triple Flag will have the right to purchase 3% of payable gold from the two mines. For Agbaou, the gold stream rate will step down to 2% of payable gold after the delivery of 29,000oz of gold. However, for Bonikro, the gold stream rate will step down to 2% of payable gold after the delivery of 39,300oz.

Triple Flag will make ongoing payments of 10% of the spot gold price for each ounce delivered under the two streams, it said.

The streams are subject to a period of minimum deliveries. From 2024 to 2027, an annual minimum of approximately 2,500-2,750 gold equivalent ounces (GEOs) will be delivered under the Agbaou Stream and an annual minimum of 3,500-4,250 GEOs will be delivered under the Bonikro Stream.

Results

Elsewhere, Triple Flag released its Q2 2024 results today and announced a dividend of $0.055/share, amid an increase in revenue. Triple Flag's forward annualized dividend is now $0.22 per common share, an increase of approximately 5% versus the previous annualized dividend of $0.21 per common share. This represents the Company's third consecutive annual increase of the dividend since its May 2021 initial public offering.

Revenue is up to $63.6million, from $52.6million over the same quarter of 2023 and EBITDA was at $53million, up from $42million in Q2 2023.

In terms of Q2 production, the company posted output of 27,192 gold equivalent ounces (GEOs), up from 26,616GEOs in the same period of 2023.

It sold $16,124 worth of gold (2023: $17,134); $11,068 worth of silver (Q2 2023: $8,215).