Versamet Royalties has signed a definitive agreement to acquire a 3.52 per cent gold stream on the Eskay Creek project, owned by Skeena Resources Limited, in northwest British Columbia. The transaction is valued at US$360 million, comprising US$340 million in cash and US$20 million in Versamet common shares. 

Vancouver-based Versamet is purchasing the stream from funds managed by Orion Resource Partners LP and affiliates of Blackstone Inc. A precious metals streaming model is a financing agreement in which an investor provides upfront capital to a mining company in exchange for the right to purchase a percentage of the future metal production at a discounted price. 

“This acquisition marks a significant step-change in Versamet’s scale, adding a large, uncapped gold stream on what is expected to become one of the highest-grade, lowest-cost open-pit precious metals mines globally, located in a premier Canadian jurisdiction,” said Dan O’Flaherty, CEO of Versamet, in a press statement on April 6. 

The Eskay Creek project is widely expected to rank among the world’s highest-grade precious metals operations. As of Feb. 28, construction was approximately 49 per cent complete, with first production targeted for the second quarter of 2027. 

The gold stream will provide Versamet with 3.52 per cent of payable gold production over the life of the mine, with no caps, step-downs or buyback provisions. The company will pay 10 per cent of the spot gold price for delivered ounces. If project completion is delayed beyond September 2027, the agreement also includes a provision that would increase the stream percentage incrementally each quarter until the project meets its completion tests. 

The Eskay Creek project is estimated to produce more than 300,000 ounces of gold annually during its first five years, followed by an average annual output of about 230,000 ounces over an initial 12-year mine life. 

Historically, the Eskay Creek site was one of the world’s highest-grade precious metals mines, producing 3.3 million ounces of gold and 160 million ounces of silver between 1994 and 2008. 

For Versamet, the gold stream acquisition represents its largest to date and is expected to materially increase the company’s gold exposure. Attributable production is projected to exceed 30,000 gold equivalent ounces annually once the mine reaches full capacity, including more than 10,000 ounces per year from Eskay Creek during the first five years of production.  

The deal also supports a broader portfolio shift for Versamet, with approximately 50 per cent of the company’s attributable production expected to come from Canadian assets by 2028. This includes contributions from Eskay Creek, as well as from Equinox Gold’s Greenstone mine in Ontario and Artemis Gold’s Blackwater mine in B.C. 

“As our largest acquisition to date, this transaction enhances the quality and durability of our portfolio while maintaining exposure to exploration and expansion upside,” O’Flaherty said. 

Following the transaction, Versamet will hold seven producing royalties and streams, with three additional assets expected to begin production by the end of 2027. The company is expecting 2026 attributable gold equivalent ounces of between 20,000 and 23,000 gold equivalent ounces, with approximately 85 per cent of its revenue derived from gold and silver.