Corporate Update on Wheaton Precious Metals Corp. and Spanish Mountain Gold Ltd.

Overview of the Transaction

Wheaton Precious Metals Corp. (WPM) has confirmed receipt of the first installment of a US $22.5 million payment related to the sale of a 1.5 % net smelter royalty (NSR) to Spanish Mountain Gold Ltd. (SMG). The transaction, completed earlier in 2026, represents a strategic financing move that strengthens WPM’s capital position while providing SMG with a robust royalty stream. The NSR arrangement underscores WPM’s commitment to the Spanish Mountain Gold project, an exploration venture with potential for significant gold output.

Progress on the Spanish Mountain Gold Feasibility Study

  • Feasibility Study Initiation SMG launched its comprehensive feasibility study in Q2 2026. The study is designed to evaluate the project’s economic viability, including mineral resource estimates, processing methods, infrastructure needs, and cost projections.

  • Drilling and Data Verification SMG has conducted an extensive drilling program in 2026, aimed at validating the mineralization outlined in the initial resource model. Key highlights include:

  • Multiple drill holes intersecting gold at moderate grades (≈ 4–6 g/t) across significant widths (> 10 m).

  • Consistent geochemical signatures that confirm the continuity of the ore body.

  • Updated structural mapping that refines the ore zone geometry.

  • Feasibility Model Refinement The newly acquired drill data are feeding into a refined feasibility model, scheduled for completion by early 2028. This model will incorporate updated commodity prices, operating costs, and potential environmental compliance costs.

Financial Implications for the Project

  • Second Installment Received In addition to the initial payment, SMG reported receipt of a second installment from WPM. This cash infusion enhances the project’s financial base, mitigating funding gaps that could otherwise delay the construction decision.

  • Risk Management WPM’s involvement provides an added layer of risk management. By securing a royalty stream, WPM can offset potential exploration failures, while SMG benefits from a predictable revenue stream that eases financing negotiations with external lenders and equity investors.

Strategic Context

  • Royalty Model Trends The use of NSR agreements is increasingly prevalent in the global mining sector, offering a low‑risk, long‑term revenue model for royalty holders. This trend aligns with a broader shift toward asset‑backed, passive income streams among mining investors seeking portfolio diversification.

  • Economic Drivers Gold prices have remained resilient, supported by macro‑economic uncertainty and inflationary pressures. Higher prices increase the upside of projects like Spanish Mountain Gold, making the feasibility study’s outcomes more favorable. Simultaneously, rising interest rates and tightening credit conditions emphasize the importance of strong, predictable cash flows, which NSR arrangements provide.

  • Cross‑Sector Comparisons Similar royalty strategies are being deployed in other metals, such as copper and lithium, where commodity volatility necessitates stable income streams. The success of WPM’s NSR approach could encourage analogous models across the sector, reinforcing the broader economic trend toward decoupled royalty financing structures.

Outlook

With the latest installment secured and the feasibility study progressing, Wheaton Precious Metals Corp. demonstrates its capacity to maintain active participation in a high‑potential gold project while optimizing its risk‑return profile. The combination of robust mineral data, a clear financial roadmap, and a structured royalty partnership positions the Spanish Mountain Gold project favorably for a construction decision in the near term. This development exemplifies how strategic partnerships and disciplined exploration can generate sustainable value across the mining industry.