BHP Unlocks US$4.3bn Through Landmark Antamina Silver Streaming Deal

About BHP Group Limited

BHP Group Limited (ASX: BHP) is the world’s largest diversified mining company by market capitalisation and one of Australia’s most globally significant resource producers. The company operates across iron ore, copper, metallurgical coal and nickel, supplying commodities that underpin industrial development and the global energy transition.

Central to BHP’s capital allocation philosophy is a disciplined focus on high-return assets and commodities aligned with long-term structural demand. The latest transaction reflects this strategic approach, with the Group monetising non-core silver exposure at its Antamina mine in Peru while maintaining full economic interest in core metals. The agreement represents a landmark streaming transaction in the global mining sector and signals ongoing active portfolio optimisation by BHP.

Transaction Overview

Under the agreement, Wheaton Precious Metals will pay BHP US$4.3 billion in upfront cash consideration upon completion. In exchange, Wheaton will receive silver linked to BHP’s 33.75 per cent shareholding in Antamina’s silver production, subject to defined payable rates and thresholds.

In addition to the upfront payment, BHP will receive ongoing production transfer payments equivalent to 20 per cent of the prevailing silver spot price at the time of delivery. Once 100 million ounces of silver have been delivered under the agreement, the streaming percentage reduces to reflect a lower share of future production for the remaining life of the mine.

The transaction is structured as a long-term metal credit arrangement rather than a physical delivery obligation, preserving operational flexibility. Completion is expected in April 2026 and is not subject to regulatory approvals, requiring only customary closing conditions.

Strategic Rationale

BHP described the agreement as a disciplined capital management initiative that unlocks immediate value from a non-core by-product while preserving exposure to the mine’s primary commodities. Antamina is primarily a copper and zinc operation, with silver produced as a by-product. By monetising future silver production today, BHP effectively converts a secondary revenue stream into immediate capital that can be redeployed into higher-return growth opportunities.

The transaction strengthens BHP’s financial flexibility without increasing reported debt levels. Management emphasised that the deal complements broader portfolio optimisation initiatives and supports funding capacity for future copper and potash developments. The upfront proceeds materially enhance liquidity at a time when demand for copper, a key electrification metal is expected to accelerate over the coming decade.

Antamina Asset Context

Antamina is one of the world’s largest copper and zinc mines, located in Peru and operated by Compañía Minera Antamina S.A. Shareholders include BHP, Glencore, Teck Resources and Mitsubishi Corporation.

In calendar year 2025, Antamina produced substantial volumes of copper and zinc, alongside silver as a by-product. For BHP, the asset remains strategically important for its copper exposure. The streaming agreement does not alter ownership, governance rights or production levels of copper, zinc or lead, ensuring continuity in operational performance.

Capital Allocation and Financial Implications

The US$4.3 billion upfront proceeds represent one of the largest streaming transactions globally based on initial consideration. Combined with previous portfolio initiatives, the transaction enhances BHP’s capacity to fund organic growth projects, manage balance-sheet strength and maintain competitive shareholder distributions.

Importantly, the agreement does not alter BHP’s capital management framework or dividend policy. The absence of incremental debt reinforces the Group’s conservative funding strategy. By maintaining exposure to core commodities while monetising non-strategic metals, BHP continues to align its portfolio with long-term structural trends such as electrification, decarbonisation and urbanisation.

Market Implications

Streaming agreements have become increasingly common within the global mining industry as companies seek capital-efficient funding solutions. However, transactions of this magnitude remain rare. The pricing and structure of the deal reflect strong silver market conditions and highlight investor appetite for precious metals exposure.

For BHP, the transaction demonstrates an ability to extract incremental value from existing operations without compromising long-term strategic positioning. It also reinforces the attractiveness of diversified mining portfolios capable of generating optionality from by-product streams.

Outlook

Looking ahead, BHP’s focus remains firmly on copper, potash and high-quality iron ore assets. The silver streaming transaction improves capital flexibility as the company continues to assess growth opportunities across its global portfolio.

With strong commodity fundamentals and disciplined portfolio management, BHP appears well positioned to navigate cyclical volatility while maintaining long-term strategic alignment with global resource demand trends.