Wheaton’s new CEO sees billion-dollar streaming era

Wheaton Precious Metals (TSX, NYSE: WPM) expects multi-billion-dollar streaming deals to become a regular part of its growth strategy after its $4.3-billion Antamina transaction pushed the company into a new league of mining finance, CEO Haytham Hodaly said.The precious metals streamer could complete roughly one transaction of that scale annually over the next three to four years rather than pursue several simultaneously, Hodaly said on The Northern Miner Podcast. Wheaton has historically deployed close to $1 billion a year on new streams, but has committed about $4.7 billion this year while retaining more than $2.5 billion of capacity on its revolving credit facility.“What the market views as a 10 or 12 year-life,” Hodaly said of Antamina. Wheaton’s technical due diligence indicates the mine could continue operating for at least another 30 to 50 years, he said.The larger transactions reflect Wheaton’s growing financial capacity as its portfolio generates about $2.7 billion annually in free cash flow. They also mark a new phase for a streaming model the company pioneered more than two decades ago, even as Hodaly says its core strategy remains focused on high-quality, low-cost and long-life mines in stable jurisdictions.Spanish Mountain inks $55M royalty deal with Wheaton Precious MetalsHodaly became CEO on March 31 after serving as president since June 2025, succeeding Randy Smallwood, who moved to non-executive chair. Hodaly joined Wheaton in January 2012 and previously led corporate development.Antamina scaleThe deal setting the benchmark is Wheaton’s $4.3-billion silver stream on BHP’s (NYSE, LON, ASX: BHP) share of the Antamina copper-zinc mine in Peru.Hodaly described the transaction as opportunistic for both companies. Silver traded around $76 an oz. when the deal was struck, allowing BHP to crystallize value after the metal’s run. Wheaton already knew Antamina through a stream it has held since 2016 through partner Glencore (LON: GLEN), while watching the operation permit expansions, increase tailings capacity and replace mined reserves.The transaction was years in the making. Wheaton first approached BHP about five years ago before the companies resumed discussions about 15 or 16 months ago, Hodaly said. Part of that process involved demonstrating how a stream works and what it can do for a miner’s balance sheet.BHP signs silver streaming agreement with Wheaton Precious MetalsWheaton does not need acquisitions to deliver its near-term production growth. It expects output to rise from about 803,000 gold-equivalent oz. in 2025 to 1.2 million oz. by 2030, an increase of about 50%.Those ounces come from projects that are permitted and financed and, apart from three expected to break ground within months, already under construction. Wheaton’s portfolio includes 22 producing operations, more than 20 development projects and 15 royalties and exploration assets.The portfolio is currently about 52% gold and 48% silver and is expected to shift to roughly 60% gold and 40% silver over the next five years.Bigger transactions will not displace smaller ones, Hodaly said. Wheaton can earn stronger returns on some smaller deals because streamers generally have greater negotiating leverage with juniors than with major miners.Competition, however, has multiplied. Wheaton launched as Silver Wheaton in 2004 when only a handful of royalty and streaming companies existed. Hodaly estimates there are now 30 to 40.Antamina expects significant copper output boost in 2026“If we wanted to, we could theoretically buy every single stream that ever existed, but that’s not our strategy,” he said.Wheaton instead assesses potential investments using five main criteria: jurisdictional stability, low risk, technical maturity, operating-team quality and a corporate structure that works efficiently for tax.Cost advantageA central attraction of streaming for investors is insulation from the inflationary pressures facing mine operators, according to Hodaly.Once Wheaton funds a stream and the project passes its completion test, the company bears neither capital nor operating cost exposure. About 80% of its portfolio is in the lower half of the cost curve, positioning Wheaton on mines that operators are more likely to reinvest in and keep running through commodity cycles.The structure of its payments has nevertheless evolved. Wheaton historically paid a fixed amount for each ounce delivered, with the payment escalating by 1% every third or fourth year. Newer agreements use a percentage of spot prices.That approach modestly increases Wheaton’s costs — by about 20% for every $100 increase in gold — but allows mining partners to participate in higher commodity prices rather than leaving them with fixed-payment streams that can become increasingly burdensome.Hodaly also pushed back against criticism that streams can weigh on mining assets. Rob McEwen, chairman and chief owner of McEwen Mining (TSX: MUX; NYSE: MUX), has said investors should check whether streams or royalties encumber potential investments.Hodaly argues the opposite: streaming capital strengthens companies by allowing them to advance projects without issuing equity.“We come in and we support these companies without taking equity,” he said.Wheaton’s growing cash generation is reinforcing that argument. Second-quarter revenue hit a record $929 million while operating cash flow rose 57% from a year earlier to $650 million. The company raised its quarterly dividend by 18% this year to 19.5¢ a share and expects payouts to continue increasing as cash generation exceeds the amount it can deploy.Hodaly remains bullish on both metals underpinning the portfolio. Central-bank purchases led by China and Poland and inflows into exchange-traded funds are supporting gold, he said, while electrification, decarbonization and AI data centres are lifting silver demand.“We feel silver longer term is going to go higher, much higher as well, especially with the current structural deficit that we’re seeing right now,” Hodaly said.Weiter zum vollständigen Artikel bei Mining.com Weiter zum vollständigen Artikel bei Mining.com