Canada-based Allied Gold has announced a streaming transaction with Triple Flag, which will provide the miner with a $53-million upfront cash payment, as well as ongoing payments equal to 10% of the spot price.

In terms of the agreement, Triple Flag gains the right to purchase 3% of the payable gold produced at each of the Agbaou and Bonikro mines, in Côte d'Ivoire, subject to a step-down to 2% after set delivery thresholds.

"We are delighted to partner with Triple Flag on this streaming agreement,” said chairperson and CEO Peter Marrone.

“This transaction not only underscores the inherent value of our Côte d'Ivoire assets, as it implies a valuation multiple significantly higher than that at which the company went public and the price at which the company's shares currently trade in the market, but it also provides us with the financial flexibility to advance our exploration, growth, and optimisation initiatives at a competitive cost of capital, which is significantly better than other alternatives evaluated, including equity financing," he said.

Agbaou and Bonikro are part of Alllied’s CDI Complex in the Birimian Greenstone Belt. Allied is targeting a sustainable production platform of 180 000 oz/y to 200 000 oz/y on a combined basis and a mine life greater than ten years for the complex. This goal is driven by an extensive exploration programme, cost optimisations and process improvements.

The advance amount from Triple Flag ensures self-funding for Allied's extensive exploration programme for the CDI Complex, with a total of $16.5-million allocated for 2024 to advance highly prospective sites such as Oume, Akissi-So, Agbalé, and other targets.

Meanwhile, in an update on its financing strategy, Allied stated that it expected to be fully financed based on cash flows. However, to ensure it was not fully dependent on the price of gold, the miner is pursuing a select number of nondilutive alternatives. This strategic direction, Allied said, was prompted by the current capital markets not fully capturing the inherent value of its assets.

Given the competitive cost of capital realised through the Côte d'Ivoire stream and strong market feedback, Allied is arranging a $250-million Kurmuk funding package comprising a gold stream and a gold prepay facility on the Kurmuk development project. This comprehensive funding solution is expected to close by the end of September 2024. The prospective stream validates the opportunities at Kurmuk, including its strong geological upside potential, and has attracted significant interest at an attractive cost of capital.

The gold prepay facility would bring forward cash flows and include a built-in gold price hedge amidst favourable market prices. This prepay would begin gold deliveries after Kurmuk's anticipated mid-2026 construction timeframe, further balancing the cash requirements for its construction.

Lastly, this financing plan would provide Allied with further financial flexibility to apply cash flows from existing operations towards possible acceleration of expansion plans at Sadiola, maximising value creation and returns to shareholders.