Toronto- and New York-listed Solaris Resources on Wednesday announced a $200-million financing agreement with precious metals streaming and royalty company Royal Gold, securing nondilutive funding to advance its flagship Warintza copper project, in Ecuador.

The funding package, which comprises a gold stream and a net smelter return (NSR) royalty, was finalised following a competitive process and will enable Solaris to repay its senior debt facility with Orion Mine Finance and fund derisking activities through to a final investment decision (FID).

The first $100-million tranche is available immediately, while a second $50-million tranche will become available on completion of a prefeasibility study (PFS) and approval of the environmental-impact assessment. A final $50-million tranche will be accessible one year after closing and subject to customary conditions, including perfected security.

“This transaction is a clear endorsement of the potential scale, geological qualities and the near-surface nature, economics and stage of development of Warintza, one of the few remaining near-term, globally significant copper development opportunities not controlled by a major,” said Solaris president and CEO Matthew Rowlinson. 

“Further, it is a reflection of the strong investor confidence in Ecuador as a mining jurisdiction, supported by the government’s commitment to the sector as a pillar of long-term economic development.”

Rowlinson added that the gold stream, expected to represent only a small percentage of the gold over the life-of-mine, together with the royalty, enabled Solaris to maintain project flexibility. 

“Through partnering with Royal Gold, a leader in the precious metals streaming and royalty space, this has not only brought very competitive cost of capital to the table, but a valued strategic relationship.”

Nonexecutive chairperson Richard Warke praised the management team for securing a funding package and described the agreement as a “major milestone” in the Warintza development.

“This financing structure provides Solaris with long-term liquidity while maintaining corporate flexibility going forward, allowing the company to fully enhance shareholder value,” said Warke. “Their swift efforts have positioned us for growth without foreseeable share dilution."

Under the agreement, Royal Gold will receive 20 oz of gold for every one-million pounds of copper produced from a defined area of interest (AOI), with Solaris receiving 20% of the spot gold price for the first 90 000 oz delivered, increasing to 60% thereafter. The associated NSR royalty starts at 0.3% and escalates yearly by 0.0375% to a cap of 0.6%, unless gold delivery commences or eight years have elapsed.

The stream AOI covers a small portion of the Warintza district, allowing Solaris to retain exposure to broader regional exploration upside across its 260 km² landholding. The company may also spin out noncore assets, subject to a 1.2% royalty on those properties.

The company expects to complete and publish the Warintza PFS in the third quarter, alongside an updated mineral resource estimate following more than 82 000 m of infill drilling. A bankable feasibility study will follow. Environmental approval is targeted for mid-2025, with project exploitation permits expected by mid-2026.