By John Tilak
TORONTO, Sept 16 (Reuters) - Glencore GLEN.L is in talks
with Franco-Nevada Corp FNV.TO , Silver Wheaton Corp SLW.TO ,
Royal Gold Inc RGLD.O and two other companies to sell portions
of the future production of three South American copper mines,
two sources with knowledge of the talks said.
The so-called streaming deals involve Glencore's Antamina
and Antapaccay copper mines in Peru, and its Collahausi mine in
Chile, they said. The sources asked not to be identified as the
matter is confidential.
Some details of the deals were first carried by Global
Mining Observer, a London-based online mining publication. (http://www.globalminingobserver.com/)
One source said on Wednesday the talks could expand to
include other Glencore mines. He said Glencore was also in
discussions with Osisko Gold Royalties OR.TO , a smaller
streaming company.
Streaming transactions are a type of alternative financing
in the mining industry, in which a company such as Franco-Nevada
or Silver Wheaton provides funds upfront to a miner in exchange
for the sale of a fixed amount of future production at a
discounted price.
Glencore, a global miner and trading company, said last week
that about $2 billion of a $10 billion debt reduction plan it
unveiled will come from asset sales, which could include
precious metals streaming transactions.
The three South American copper mines produce precious
metals such as silver and some gold as by-products.
Franco-Nevada, Silver Wheaton, Royal Gold and Glencore all
declined to comment. Osisko did not immediately respond to a
request for comment.
Glencore owns 33.75 percent of the Antamina mine with
partners BHP Billiton (LONDON:BLT) BHP.L BHP.AX , also with 33.75 percent,
Teck Resources TCKb.TO with 22.5 percent and Mitsubishi Corp
8058.T with 10 percent.
Glencore and Anglo American AAL.L both own 44 percent of
the Collahausi mine, with a group of Japanese companies owning
the remaining 12 percent. Glencore owns 100 percent of the
Antapaccay operation.
(With additional reporting by Nicole Mordant in Vancouver and
Sarah McFarlane and Freya Berry in London; Editing by Jeffrey
Hodgson and Richard Chang)