2023-10-10 14:49:02 ET
Wheaton Precious Metals Corp. (WPM)
John Tumazos Very Independent Research Conference
October 10, 2023 12:15 PM ET
Company Participants
Randy Smallwood - President and Chief Executive Officer
Conference Call Participants
John Tumazos - Very Independent Research
Presentation
John Tumazos
Good afternoon. We're so pleased today to host Randy Smallwood, the President and CEO of Wheaton Precious Metals. He and his company pioneered streaming almost a generation ago. And then build a tremendous asset with, family of assets with great returns, and I'll let Randy tell the story.
Randy Smallwood
John, thank you, for the introduction. And, excited to be here. As mentioned, my name is Randy Smallwood, I've been with the company since we created it back in 2004. So we're very close to celebrating our 20th year. I'm getting some feedback, John's a high pitched thing, I'm not sure if it's coming from your side or what.
John Tumazos
I'm going to turn off my microphone.
Randy Smallwood
There we go. That sounds way better. Yes, so anyways, appreciate everyone taking the time to listen to our story. We've had it's been an incredible 20-years of growth and I think we're setting ourselves up to have especially the next five years, some incredibly strong growth to just take our company to a new level. And so as the title says here, it's a high margin company with good strong growth going forward and we are focused on precious metals.
There of course will be some forward-looking statements in my presentation. I urge everyone to understand the risks associated with those forward-looking statements buried somewhere in the fine print here. So, who is Wheaton? Or what is Wheaton Precious Metals? Who are we? What are we doing?
We created the streaming business model back in 2004, as I said, close to 20-years ago. And that streaming business model is a good strong business model for delivering value back to not only our shareholders, but to all of our stakeholders. And it's a real key thing. And I always argue that's the big difference between streaming versus royalties is that streaming is focused on partnerships, and it's partnerships with our operating partners, but it's also increasingly important, partnerships with the communities and the neighbors that we have, both where we have our offices and our employees, but also the neighbors that we have around the mine sites that deliver us gold and silver. And so it's a really sort of a triple approach where we focus of course on shareholders and delivering good value back to our shareholders, but not just them, our partners also very, very important in terms of making sure that we do everything we can to help them stay healthy. Because the healthier they are, the healthier we are.
And of course, that also comes into play with providing support to those local communities at the neighborhood level. And so, you know, for the last 10-years, we've been co-funding programs in the local communities and that's something that's been very, very well received. In fact, I think it's established a bit of a precedent, and just about all the streaming and rail companies are now following suit. So very proud of the legacy that we've created there.
The streaming business model, it really comes down to just an upfront cash payment that the company used to fund growth. And for that cash, we get access to non-core by-product precious metals from some really high quality mines. And so our portfolio, we've got a very high quality portfolio. We -- the first criteria that we look at as operating margins with respect to which companies or which mines we invest into, and 93% of our current production comes from the bottom half of the respective cost curve. So a good, strong, high quality portfolio that also has a great expansion potential and exploration potential.
Again, because these are the most profitable mines, not just for us, but for our partners, it's the first place that they go back and then reinvest into to look at exploration, to look at expansions, to try and move forward. On top of that, if there's any challenges at the mine, they put a lot of focus on making sure that those get resolved, so they can continue delivering high margin returns to even their shareholders and of course us as the streamers.
The streaming model itself is really good from a shareholder perspective in the sense that we have predictable costs. And if there's one challenge in the mining industry, it's delivering on costs. But when you're investing into Wheaton, you know, what our upfront capital is, and you know what our operating cost is on a per ounce basis. It is defined in the contracts. There are no cost surprises within Wheaton. And of course, because there's streams, we do get a production payment. We make a production payment on a per ounce basis, which does give us a leverage over just straight bullion holdings or even royalties. We actually have stronger price reaction, because we have that base production payment that we do make on a per ounce basis as the metal gets delivered to us.
Got a good strong dividend and plenty of capacity to keep growing that dividend and of course a lot of projects that haven't even been included in our current growth profile that could deliver upwards in excess of 200,000 of gold equivalent ounces per year as they come on stream over to get their permits and decide to move forward. So it's a good strong advantage that we have. We really do think that what we've delivered is a good, strong, sustainable way of investing into precious metals.
We have been busy the last few years. Of course, kind of, a unique period for all of us in terms of dealing with COVID, but we have been very busy. And so, as it says, 93% of our production currently is from the first and second quartile. We've got good, strong reserve life. But what's particularly exciting is the number of investments we've made over the last while, close to $2 billion being invested over the last few years over 13 new deals and so this is since 2020 and that's going to contribute along with some organic growth at some of our existing assets to give us actually close to 50% growth over the next five years. This year we expect to do close to 630,000, we should be close to a million gold equivalent ounces per year of production by 2027.
Good strong balance sheet, over $800 million in cash on hand, and a $2 billion revolver available for us to use if we so choose. I'd love to be down into that revolver, because we're putting this money -- there's only two places the money goes. It funds the dividend back to our shareholders or it goes into the ground for new transactions and we are very busy on the new transactions front. So looking for all sorts of new opportunities there.
It's a, one of the beauties of the streaming business model is that it's a very low G&A, lean management team. We've only got 41 employees total in the company itself and a real good strong focus on a good strong team, but it doesn't take a lot to manage a streaming portfolio in terms of personnel and so G&A is always very, very attractive on a relative basis.
And of course, as you've heard with our community investments and other focus and commitments with respect to carbon, we do lead the sector with respect to sustainability ratings. And all the different analytical firms out there that rate, all the different rating firms out there have us at the top of -- actually the resource space, not just the streaming space, but the entire resource space. The portfolio itself, as you can see, very America-centric, lots of assets in Mexico and Peru. We did start off as a silver-focused company and have expanded into the precious metal space. We now actually produce much more gold than we do silver, but definitely a strong America's focus.
As you can see, lots of development projects, we have 19 different mines delivering us metal currently, but some really good strong growth assets that are under construction right now the Goose project with B2Gold, Blackwater with the -- Artemis with the Blackwater project and then other projects that are moving forward, you know, assets like Copper World getting closer and closer to having that move forward. So lots of good strength and growth in the portfolio itself, but very, very focused on managing political risks, staying away from politically risky jurisdictions.
The other thing I’d to highlighting on this slide is just the range of partners that we have. It's clear that the streaming business model truly does work for the entire industry. And you can see from partners as big as Vale, Glencore, Newmont, and Barrick all the way down to partners, single asset companies like [Cucho] (ph), Panoro, Amina and Rio too. It's streaming does work for the entire spectrum of the mining industry.
I think if there's a slide that differentiates us from any -- with respect to our peers, it is really the quality of our portfolio. And as I said earlier, around 92% of our production comes from the first and second quartile. But on top of that, because we're investing in the base metal assets as a precious metals company, we do get the benefit of those longer reserve lives that -- and resource lives that base metal assets tend to have. And so you can see the math there. We've got over 60-years of reserves and resources in front of us. Astounding in terms of the portfolio that we have. High margins, high operating margins, and good long life assets.
I'd say this is the other slide, that this is the other piece of information that really does differentiate us from our peers and that is the growth profile that we have over the next five years. As I said earlier on we're going to produce somewhere around 630,000 gold equivalent ounces this year, but over the next five years we will be climbing up to very close to a million gold equivalent ounces. It's actually close to 50% growth and that is all expected. Two-thirds of that is actually coming from brownfields growth. It's from expansions and higher grades that are existing operations that are already delivering it. Only a third of that comes from new construction which is Blackwater, Goose and maybe a little bit of Curipamba, Santo Domingo coming into play and perhaps Copper World moving forward. But the bulk of this growth is coming from Salobo, Constancia, Antamina, which isn't on the list here, but Antamina has some higher grades as they move the input crusher and access some higher grades coming in. Stillwater cost an improvement program and Voisey’s Bay getting into full underground production from the cobalt side.
So a growth profile that when you consider the scale of our company is unparalleled in the precious metal space and definitely stands out amongst our peer group of other streaming and royalty companies. This is the beauty of the streaming business model, fixed margins. You could see the cost on our per ounce basis for gold and for silver, very, very attractive and no surprises, so very, very high margins going forward. So that fixed costs, it also allows us to predict with good confidence and as we have new assets coming on, of course, those costs drop, because they get established back at their spot. So you can see the -- their actual cost on a per ounce basis, on a go forward basis, will actually reduce from even where it is right now, giving us even better margins. So good, strong business model.
The balance sheet is also very strong. We've got a $2 billion revolver that's available for us. It's undrawn. We don't have any debt in the company. Currently have just over $800 million cash on hand, I’d say currently, that was at the end of Q2. We had just over $800 million cash on hand and so plenty of capacity and we're very busy looking for new opportunities to reinvest that money into. So it's a balance sheet that if the money doesn't go back into the ground, it will work its way into the dividend program and start feeding that back to our shareholders.
This is really what it's all about, is building up a portfolio that allows us to take advantage of stronger prices in precious metals. And in fact, the last bull cycle that we had in precious metals, I would argue that it's been a continuous bull cycle, but we had of course a nice bump way back in 2011, 2012 in terms of precious metal prices. And we generated over $2 billion in excess cash, more than what we were forecasting. And of course now we're producing substantially more metal. And with the growth profile over the next five years combined with an outlook for stronger commodity prices, I think we are perfectly positioned to deliver the best exposure to precious metals for our shareholders.
And in fact, it's interesting, we've actually earlier this year finally surpassed the amount of cash flow that we've generated from our investments has now exceeded the amount of money that we've invested into the ground. And so we're net positive. And this is especially impressive when you consider that we've got 60-years of reserves and resources in front of us still of high quality, high margin reserves and resources going forward. So we've already received our capital payback and we still have 30-years of reserves and another 30-plus years of mission indicated in [FERB] (ph) resources. So very, very good position right now.
Our dividend, as I mentioned, we have a floor of 30% of the average of the previous four quarters operating cash flows. We make sure that we maintain it as a minimum. But we also, it's a sliding scale and as the dividend bumps up, it stays up, it doesn't drop down. And so as you can see, we've got some good strong strength. One of the things I'm particularly proud of is the fact that we do a better job of returning our revenue back to our shareholders. A larger share of every ounce of gold goes back to our shareholders than anyone else in the space. As you can see, well over $400 for every ounce we produce, well over $400 of value from that ounce gets funded back to our shareholders and substantially higher than anyone else in the precious metals space.
So why would a precious metals company actually want to do a stream? There's numerous reasons as to why we're much more attractive than debt or equity. You can see them all here. But really the only ones that are important is the second one and the third one, that should be enough to satisfy everyone in the space. Actually I would say the first one is incredibly important right now too, especially with single asset companies in today's environment. The equity markets are not supportive of the smaller single asset development companies and so definitely seeing a lot of interest on that side. But really it's the other side, the initial value creation, the arbitrage and value. The precious metals is worth more in our company than it is in these operating companies. And this is especially apparent if you're a base metal company.
And so that arbitrage in value, as long as we share that with our partner, it makes all sorts of sense in terms of delivering good value back to them. As I like to remind our potential partners, this is the only way that they can fund based on the value of the metal, not the value of the metal that they have in their portfolio, not the value of their share price. And so it's incredibly attractive in today's world to finance your growth going by a stream.
And of course, bringing a stream into a project always improves the rate of return back to those investors, back to those partner shareholders. And the best example I can give you is Salobo where we essentially funded 78% of the capital at Salobo and only took away 23% of the EBITDA from that asset. And so the Vale shareholders, their internal rate of return, well, their net investment, their CapEx investment to-date was $800 million net of our contributions, was only just a bit over $800 million. And they get that back every year from this mine. So streaming takes a good mine and makes it a great mine, or in the case of Salobo, it takes a great mine and makes it a greater mine. But really what it comes down to is that focus on being able to deliver good, strong rate, internal rates of return on these projects. It's something that mining investors have been screaming for a long time, and streaming is a path towards that.
Benefits to the community, of course, very, very important for us, and it's really a four-pronged approach within Wheaton. We have good strong governance policies and then a commitment on the ESG side. But then we also have a good involved community investment program. And it's not just money. It's a lot of time. We expect all of our employees to put the time and effort in to make sure that we do our best to improve the neighborhood, so to speak. And so lots of commitments on that front. And of course, good strong commitments and clear disclosure, especially in our sustainability report and all sorts of other disclosure that we've got. And so it's a good strong structure that's allowed us to have great success.
The community investment budget, this is something I'm particularly proud of, and we take 1.5% of our average net income and put it back into the neighborhoods around the mines. This is something that makes a big difference in terms of expanding the capacity. And we don't actually manage these programs we just co-invest with the operating partners and let them steer it as to where we go forward and you know have a look at all their different projects and pick it up, you know, which ones we feel are most effective and align with our whole focus in terms of health, education, environment, and community.
And so, you know, it's something that I'm quite proud of and it's definitely helped our partners thrive in their jurisdictions. And lots of examples around that. But we were the first ones to do this and again I'm proud to see that just about every streaming contract that now signed has a commitment from the streaming company to push this forward. So it's an excellent legacy that we've created here and it just makes for a stronger industry as a whole.
We of course also committed to net zero carbon emissions by 2050, early last year, and have pushed that forward. We've set aside a fund to help our partners. This does include Scope 3, which is our partners' emissions, and so we've set aside a fund to help our partners make better decisions in terms of moving these projects into lower carbon environments. And then of course the good strong commitments. And all of this has been recognized. We consistently rated at the top of any of the different ratings agencies in terms of our performance.
In fact, you know, what I'm particularly proud of is that we actually qualify as a Global 50 on Sustainalytics. The top Global 50, that's not a mining database, that's over 15,000 companies and we qualify as one of the top 50 companies in the world. That's across all sectors. That's across financial services, tourism, all sorts of manufacturing issues. Wheaton is the only resource company in the top 50. So good, strong performance on this front. Something I'm proud of, but something that's an area of continuous improvement, continuous focus.
So why should you invest into Wheaton? Well, if you've got an appetite for precious metals, I would argue that we are the best way to invest into precious metals. We are focused on precious metals. Most of the other streamers have very, very healthy and sizable non-precious metals components to their revenue streams. We are focused on precious metals. Of course the streaming model gives all sorts of advantages and cost exposure, expiration upside, good strong sustainable dividend, but plenty of reasons as to why. And in fact, this highlights here, 97% of our production does come from precious metals, which is very healthy, compared to our peers.
And as we see precious metals moving forward this will bode well for Wheaton. In fact we have more precious metals revenue than anyone else in the peer group. So what have we done? Well as of the middle of this year, as I mentioned, we invested $9.6 million, we've been invested into streams to-date, but we've already got back $9.8 billion. And we're very close to putting $10 billion into the ground. But our cash flows are getting stronger and stronger all the time. We do give a good portion of that back to our investors, to the dividend. We're close to $2 billion declared in dividends back to our shareholders to-date.
Good strong annual cash flows that are going to have lots of growth over the next four or five years. 40-years of reserves in M&I and then another 20-plus years of inferred resources. A good strong commitment to sustainability. And all of this delivers a good strong return for after-tax return to our shareholders. Our average since creating the company back in 2004 is 17%. Average annualized after-tax returns. So a very attractive way of getting exposure to precious metals, which everyone should have in their portfolio.
In fact, if you look at multi-year return comparison, you compare us to bullion or the mining companies, you can see how Wheaton has outperformed in multi periods, multiple types of periods, we have always outperformed. So if you like precious metals, you should really like Wheaton. We have good strong growth, we have lots of exploration, expansion potential, a good optionality portfolio of stuff that isn't even factored into that growth profile yet. Very high quality, long life asset base, predictable costs, differentiates from any other mining space that you're looking at. The streaming model gives us better leverage to commodity prices, a good strong commitment to being sustainable, and our dividend by virtue of being linked to cash flow, it will be growing.
So John, this is my last slide. Now I'm going to figure out how to unshare.
Question-and-Answer Session
A - John Tumazos
Randy, Thank you very much. Anyone can submit a question through the question box. I have a few, who's the operator for a [Indiscernible]? Is that Adventus in Ecuador?
Randy Smallwood
Yes, that's right. Christian Smedegaard, he's moving it forward quite nicely. It’s El Domo is the main deposit there that is a really good strong high grade VMS type deposit. So it's got good base metal credits and a healthy silver and gold byproduct and so making good progress in terms of moving that project forward.
John Tumazos
Who is the operator of Toroparu, and is that Guiana?
Randy Smallwood
Yes, it's in Guiana, but it's owned by Eris Mining. Eris, of course, is mainly focused in Columbia. The Marmato project, where we have a stream, and the lower Marmato, it's a big portion of growth. We expect gold production out of Marmato to probably grow 3 times to 4 times as the lower zone gets developed. It should be a nice healthy contributor to us. Toroparu is probably, you know, they've got a -- it's one of their portfolios that they, or one of the assets that they have. There's not a real schedule for it to be moving forward here anytime soon, but they are advancing it. They're doing studies on them.
John Tumazos
In the post-COVID period, Wheaton got a lot of deals done, as you said, remarkably 13?
Randy Smallwood
Right.
John Tumazos
You bypassed competition by investing in earlier stage deals that where the mine still has to be built, or maybe they're not even breaking ground yet to spend the money, they're still drilling and analyzing and studying? Talk about how your team screens the early stage projects?
Randy Smallwood
Well, it really does come down to the confidence and resource, so we have an early deposit structure which has proven to be quite attractive in today's world, mainly because of the lack of equity support. The markets are not there supporting early stage projects right now. So if you're a single asset development company that has no operating cash flow, you know, traditionally before you were actually going into construction and had access to bank debt, the only way you could fund yourself going forward was in the equity side. Well some of these projects, it's a matter of crossing teeth and dotting eyes, but there's clearly enough information available on these to make an assessment as to whether they're good quality high margin projects that fit into that.
And so our technical team will go in. We've got a good strong technical team. We are very technically driven about a third of our staff is either geologists, engineers, or metallurgists, or social scientists, I would say is another important aspect of good due diligence now. But we'll go in and go right back to first principles. We go all the way back to the drill hole assay database. The first thing we do is a geostatistical analysis to make sure that it fits the style of deposit, that there's no anomalies, looking for correlation coefficients, looking for all sorts of trend analysis, variography studies, and then we'll build a block model ourselves and sort of start applying economics to it. And as we're going through this, we're always of course comparing to what the operating partner is presenting as their path forward.
And quite often we unlock value or we see risk areas going through this whole process and then we have to sit down and resolve those differences to try and understand why there is slight differences between what we see, but we build our own model on these assets going forward. There is a bit of risk with putting some capital in. We don't usually put a lot if there's a stream. We typically limit the portion of the early deposit to about 10% of the total stream value and that will come in ahead of permit. So there is a bit of permitting risk in terms of getting these projects over that line to move forward, but we think it's a structure that has good protection for us. We can always, if we're not satisfied with what comes out at the end of the permit, we can ask for our money back. But we haven't had to yet. We're pretty happy with what we've seen, everything move forward.
So we come from the mining industry. I'm a geological engineer by background. I'm very comfortable in the mining space in terms of assessing risk. And so we felt it creates an opportunity for us to step into some of these earlier stage projects and move them forward. And I can tell you that the appetite is very high in that space. The biggest challenge of course is finding those few diamonds in the rough.
John Tumazos
Randy, your appear confident within the 10-year, maybe even five year horizon that Wheaton might get to a million ounces or better, there probably are several existing assets where maybe you're confident that a permit, roadblock will get solved or the drilling is fertile and they just haven't had all the holy water dropped on it by the feasibility study consultants or whatever. But could you mention a few of the projects excluded from your forecast that you're optimistic about?
Randy Smallwood
Well, the one that's probably the most significant, so this is in the optionality portfolio, it's not part of our forecast on a go-forward basis. It's the best half-built gold mine in the world. It's called Pascua-Lama. It's down on the valley or on the border between Argentina and Chile. About two-thirds of the ore body is on the Chilean side and about one-third is on the Argentinian side. I can tell you that Barrick is putting a lot of effort into trying to move that project forward. They're doing a lot of studies and exploration on the Argentinian side. Argentina is very supportive of that project going forward. The challenge they have is re-establishing a permit on the Chilean side. But this is a project that definitely has some upside potential.
I was pleased to see one of our peers step in and invest into some royalties on the Chilean side here just recently, and especially being a peer that has been critical of the project of late. I think even they now have seen the value in Pascua-Lama, and if that project was to start up, keep in mind the first line is 90% complete, the second line is about 40% complete, and there would be a third line to be built there. But if that project was to start up, it would deliver to us on the order of about 9 million ounces of silver to our credit per year. We get 25% of whatever silver is produced at Pascua-Lama.
So if it was a start-up based on the original production plan, we would see about 9 million ounces of silver, which is a very, very healthy bump. And so it wouldn't take a lot of success and here's what I do know is that Mark Bristow likes that project as much as I do and he's you know Barrick has put time and effort and continues to put time and effort into trying to restore the permits that they've had at Pascua-Lama and bring that project into production.
It is without a doubt the best half-built gold mine in the world. And so…
John Tumazos
So that's the royalty. So 9 million ounces is at least $180 million to pre-tax bottom line.
Randy Smallwood
Clearly, yes, definitely, because even the production payments on that are low. They started $390 million an ounce from the start of production and hold at that. So yes, it's a good positive bump. And that's one that can happen relatively quickly. Take a bit of success in Chile. Chile decides to move forward and start issuing some permits. There has been some challenges in Chile of late, but we have seen a bit of a turn in the sentiment down there, especially in the last six months, eight months. They actually are starting to issue mine permits again. And so we are seeing progress down there. And I'm confident that Pascua-Lama will eventually be a producer. And when it is, it'll be a big contributor to our portfolio.
John Tumazos
What are some of the other big deposits that are not in the schedule yet?
Randy Smallwood
Well at Santo Domingo and Capstone, it is in there, but it's about four or five years out. That's a pretty impressive project that Capstone's building in Northern Chile again. They do have their permits in place, they're just cleaning up, finishing off some of the other developments they've got with the amount of copper, if you can call it, I can't remember the other project. But anyways, and so, you know, Santo Domingo is definitely coming into play.
Of course, we've got the Blackwater and Goose are well in construction. So they are part of our production forecast and go forward basis. The Marathon project with Generation Mining is also a project that we like, and they're very close to getting their financing in place. Permits look like it's all shaping up, so it would be something that would be coming in sometime over the next while. It's a good project.
John Tumazos
[Indiscernible] Randy?
Randy Smallwood
That's the Marathon Project with Generation Miners.
John Tumazos
Right, right, you have that out listed in your slides, though.
Randy Smallwood
Yes, yes, and so but it's tail end. It's not part of, sorry, I was focusing on the next five years. So it's not a big portion of our next five years. It's something that would be coming out after that. I guess the other ones, you know the -- you know the Curipamba is a promising project, you know, we see [Indiscernible] as being something that could actually quite nicely move forward and deliver some good value. And now I'd have to have the map in front of me. I hate to say it, we've got so many of them, I start remembering some of these names and I don't have the map in front of me right now.
John Tumazos
So inevitably there's some depletion. This year you had to replace Hecla's buyout of the Alexco royalty and Glencore's buyout in Peru, where you enjoyed good cash and securities as payment, are there any other declines that have to be replaced in the next several years?
Randy Smallwood
No with both of those assets, the Yauliyacu stream with Glencore was a very, very tired mind. It was very profitable for us for 12 years. We did that stream back in 2005, I think it was when we closed that transaction with Glencore. 2015 things changed down there.
John Tumazos
Sorry in terms of cash payments could you review the project payments that are due in the next several years?
Randy Smallwood
So The biggest one is we do have a expansion payment due at Salobo. We did renegotiate it to break it into two phases earlier this year. And so the way it's looking, they are hoping to satisfy the expansion of Phase 3 to the lower phase this year. So they're working hard towards that and we're watching closely. It looks like they may be on track. And if that is then we'll before the end of this year have to make a $370 million payment to Vale.
If they don't get there to that level before the end of this year, then it'll be pushed into next year, which I'm confident they will get next year. They only started Line 3 at the start of this year, So it would be very impressive if they actually were to satisfy the first phase of that expansion payment.
And then we'd have another payment due once they get to the second stage of the expansion payment. And that's probably not going to happen until 2025. And that'll be about $150 million, $160 million somewhere along those lines, depending again on the timing. And then we'd be done with respect to any further payments at the Salobo. Although we do have a high grade carrot. We have dangled an annual, sort of, performance thing, where as if they achieve certain through-puts and certain grades, then we'll compensate them with a bit of an extra. We're trying to provide an extra incentive for them to stockpile lower grade material and bring forward higher grade as they currently do. And so there is some other residual payments, but they're never more than $6 million or -- I think the highest is $8 million within a year. And so those are pretty small payments on that.
The other funding that's coming out, we've always -- we’ve got one more payment due. It's coming very quickly on Artemis at the Blackwater project. And I was actually just up at the site two weeks ago. Project is doing very well. Construction is on track. No surprises in the construction. It's kind of nice going to our mine site and seeing everything being laid out exactly the way it was planned and not having any issues with respect to challenging foundation ground conditions and stuff like that. And so Blackwater is definitely on track and moving itself forward.
The other assets that we're funding as we go forward up you see [Indiscernible] would be would be one that we'd be putting some funding into as it gets its permit and goes into construction. Goose we've fully funded, that's with B2Gold. And so we've fully funded that one. So that's done on a go forward basis. There's a payment with respect to Santo Domingo that's probably four to five years out before we'd be making any payments on that, that's probably the timeline the Capstone's got probably three to four years for the construction and then we'd see some production from that four to five years out, so and I can't remember the exact numbers behind that one. But so…
John Tumazos
All your payments are less than $829 million cash balances without even counting the cash flow coming in?
Randy Smallwood
Well, exactly. We're so well. I mean, if you sum up all the potential commitments that we have in a go-forward basis. It does get up to somewhere around $1.5 billion and that is all detailed in our reports. The -- but you know the stuff that's immediately scheduled over the next three to four years, that's, like you said, easily funded with the current cash flows on a go-forward basis.
John Tumazos
Once again the questions from the call are welcome. How many of your 41 people actively do desktop or boots on the ground project analysis?
Randy Smallwood
Well when we do a full project review. The technical team that visits will have at least one geologist, one metallurgist, one engineer and one social scientist and then typically the lead on that project, which is a lot of times Haytham Hodaly, our Senior Vice President of Corporate Development. And so that'll be our project site team that goes down. Then they dive in and what we -- we've got an interesting setup when it comes to that. We've got a dual track system that allows the two teams to sort of compare against each other. So we've got two full teams and we basically audit each other on that basis.
To just try and make sure that we're not missing anything and push it all the way through it. So when it comes to approving a project investment, I would say that you will typically have 25 to 30 people in the room out of the 41 that will all have a voice in terms of any concerns or any opportunities, anything they liked about the project, anything they're worried about the project will all come into play. And so it's a very rigorous review. I'm pretty proud of making sure that we have an environment where people feel comfortable enough to step in and share those opinions. So it's a good strong system.
John Tumazos
Are there external consultants in addition to your own staff or do you keep it all in the family?
Randy Smallwood
Yes, we were one of the first, I mean, we've always been really focused on having in-house expertise. One of the problems that I see with external consultants is that, you know, if you get a good one, they're really good at identifying risk, but rarely will they ever take on an opportunity. You know, they're not out there looking for the upside. They're out there just trying to address the potential downside. And so I've never felt that that's the best approach. I think that whenever you're doing a due diligence on a project, you need to look for both the upside and the downside. And so we have long focused on making sure we have the internal expertise.
Now on occasion, we do have to bring in, for instance, block caving is something that we don't have a lot of experience in. So if we have a project that has potential for block caving, we'll bring in outside expertise to have a look at the geotechnical, to get a -- make an assessment in terms of the viability of that. And so, it's pretty rare, it's pretty few and far between that. We actually have to bring in outside consultants. Typically everything we do is based inside keeping in the family as you said John. I like that that mentality.
John Tumazos
During COVID did the deal flow improve, because other people weren't doing physical due diligence and you were still active?
Randy Smallwood
I wouldn't say it has. I mean, we've definitely been more active than anyone else in terms of the number of deals that were out there, but we suffered a lot of the same restrictions that others did. We couldn't, you know, there was some assets where we had to hire. I mean, in that case, we did have to hire some in-country consultants, because international travel was so restrictive and we couldn't actually get our own teams onto there.
I personally, if there was one cost to COVID, it was virtual site visitors just don't work. I think, it’s so much -- it’s so important to be able to get onto the ground and actually look at the asset itself, smell the, you know, smell the dirt and make sure that you -- that it feels right. And it just makes such a big difference. And so, we had to get very creative in terms of ways to get site visits done and push forward. But we recognized that we couldn't just shut down operations. We still had to look for opportunities to help growing -- continue growing the company. And so we -- I think our track record spoke for itself.
And virtual site visits just don't work. I mean, if there was one thing that we learned through COVID, because some of the surprises that we saw when we finally got back to visiting even our existing operations were astounding. And there's no replacement for being on the ground.
John Tumazos
Randy, there's a lot of want to be smaller emerging royalty and streaming companies. Do those companies make the bottom $25 million, $1 million to $25 million transactions to competitive? And how big is your minimum deal size now?
Randy Smallwood
There's no doubt that we have seen an increase in competition, but you know I also think that we've done a really good job of establishing a reputation, so that we're a partner of choice. And I think that's one of the key things that's kept us. And so most of the stuff we're looking at right now is $300 million or less. But we're just not seeing that same level of big companies. I mean, I'll say 95% of what we're looking at right now is single asset companies that don't have access to operating cash flow.
And so the biggest challenge is keeping that focus in that space and trying to sort of buildup. Now we're not getting the multi-billion dollar deals that we've done in times past, but the fact that we've closed 10 transactions, nine transactions in the last while and cumulatively have invested $1.9 billion, to be honest, it's probably a bit of a stronger portfolio just by virtue of the diversity that you have amongst that suite of opportunities. But, you know, the industry has its cycles and those big deals will come back. We have seen a few of late that are a little bit on the bigger side, but yes, we'll see where those go.
John Tumazos
Randy, congratulations. I only admire and [Indiscernible] of what you and your team have created. Thank you.
Randy Smallwood
John, coming from you, I do truly take that as a compliment and I appreciate that. I've long admired your critical analysis in terms of investment opportunities out there. So to get that accolade and you means a lot to me.
John Tumazos
No we’re still standing after all these years.
Randy Smallwood
Yes. Yes, both of us.
John Tumazos
All of us. Thank you, Randy.
Randy Smallwood
Thank you. Bye.
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Wheaton Precious Metals Corp. (WPM) John Tumazos Very Independent Research Conference (Transcript)