Retention of Ownership
and Control
Other than to ensure the mining company is not making decisions that would prejudice the streaming company ,there is minimal input in respect of project management.
No Required
Deliveries/Payments
There is only an obligation to deliver metal if the mine is producing metal, therefore providing the company with much less risk and greater flexibility when compared to debt financing.
Transaction Mechanics
The reduced length of time results in lower transaction costs. Streaming and royalty companies generally bear their own due diligence and legal costs.
Non-Dilutive to Shareholders
Recent contractions in equity markets have made equity an undesirable source of financing as the lower market prices would result in significant dilution.
Tax efficiency
Mining company can defer tax on the up-front payment (i.e. Canadian Mining Laws). If this is not the case, it is often still possible to structure the streaming transaction efficiently.
Increase in Investor Confidence
The disclosure and investor relations activities of the streaming company expose the mining company to a broader investor base than it might typically attract.