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'We've been a bit shocked' - Wheaton Precious Metals and the trouble advancing mines in Chile

Kitco News

(Kitco News) - The easing of travel restrictions this year has allowed more visibility into mining operations, said Wheaton Precious Metals' CEO Randy Smallwood.

On Friday Smallwood spoke to Kitco. Wheaton (WPM:TSE) is a royalty and streaming company headquartered In Vancouver, B.C.

The company released its Q2 last week. Wheaton lowered its guidance for 2022 due to production issues at various mines and the termination of its agreement with Alexco Resources. This spring Alexco was acquired by Hecla Mining. Alexco ran Keno Hill Mine.

"Given the proposed termination of the Keno Hill PMPA, lower production from Stillwater due to severe weather and flooding in the state of Montana in June as well as lower than expected production at Salobo, Wheaton is lowering production guidance. Wheaton's estimated attributable production for 2022 is now forecast to be approximately 640,000 to 680,000 gold equivalent ounces," wrote the company in its Q2.

Smallwood is confident about the revised guidance.

"I can assure you that a site visit is way better than a virtual visit in terms of understanding what's going on at a mine site, so we're pretty comfortable with our adjusted guidance," said Smallwood.

Smallwood was disappointed with Rio2's Fexix project being halted. Wheaton has a streaming and royalty agreement with Rio2 and its Chile-based operation. Last month Rio2 learned that its environmental impact assessment was not approved.

"We've been a bit shocked, and I think the entire industry has been a bit shocked at how Chile has turned out," said Smallwood noting that six of the last eight mining expansions have been denied, since the country's change in government.

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