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It’s prime time for the companies that specialize in providing money to cash-strapped miners.
These businesses offer funds today in exchange for metals tomorrow. With most commodities trading far below their boom-era highs of four years ago, the cash-for-production swap has become a vital elixir for mining companies struggling to cope with debt hangovers from happier days.
So-called “streaming” companies, such as Silver Wheaton Corp., Franco-Nevada Corp. and Royal Gold Inc., have signed a flurry of deals in recent months with many of the world’s largest miners.
The details vary but the common pattern is that the streaming company pays cash to the miner now in exchange for the rights to buy future streams of metals at prices well below market levels.