Triple Flag provides 2022 metal and diamond production guidance
Triple Flag Precious Metals Corp. [TFPM-TSX] provided its full year 2022 guidance. All dollar amounts are expressed in U.S. dollars.
In 2022, we expect attributable royalty income and stream sales to total 90,000 to 95,000 gold equivalent ounces (GEOs) based on commodity prices of $1,800/oz gold, $23.50/oz silver, $4.20/lb copper and $110/carat for diamonds for the rest of the year. Sales are expected to be weighted towards the back end of 2022. Sales of 20,000 to 21,000 GEOs are forecast for the first quarter of 2022. The 2022 guidance is based on public forecasts and other disclosure by the owners and operators of our assets and our assessment.
GEOs by commodity weighting is gold at 50-55%, Silver at 40-45%, others at 5-10%. Depletion would be $59 million to $63 million. G&A costs would be $16 million to $17 million. The Australian tax rate is 25%.
Triple Flag’s long-term production outlook builds on our sector-leading GEOs growth profile since 2017, with a CAGR of 26% through 2021. The company issued its inaugural five- and ten-year outlook in Q3 2021, indicating 105,000 GEOs for both the five- and ten-year timeframes, highlighting the embedded growth within our portfolio and the long portfolio duration of more than two decades that compares favorably with the leaders in the sector.
Against this backdrop, Triple Flag has successfully extended the outlook by a year and increased the outlook in the five-year timeframe. Production over the five-year period ending in 2027 is expected to average 110,000 GEOs per year, a significant increase over current production levels primarily due to continued production growth from Northparkes, Buritica, Pumpkin Hollow, Gunnison and Dargues, and the resumption of leaching at ATO. The 5,000 GEOs per annum increase, compared to the 2021 outlook for the five-year period ending in 2026, is due to the addition of ore feed from Northparkes E31 open pit, which is expected to allow Northparkes to fully utilize the 7.6 million tonne per annum processing capacity earlier than originally expected. Processing of E31 ore is expected to commence in 2023.
Over the 10-year period ending in 2032, we expect average production of 105,000 GEOs per year, in line with our prior outlook for the ten-year period ending in 2031, benefiting from mining of the high-grade E22 block cave at Northparkes, which is expected to commence production in 2026. Centerra Gold’s Kemess project and Talon Metal’s Tamarack project are not included in Triple Flag’s five-year outlook but are included in the 10-year outlook. Long-term GEOs are based on $1,600/oz gold, $21/oz silver and $3.50/lb copper. Above and beyond the long-term production outlook, we believe there is considerable optionality related to potential life of mine extensions, expansions, and exploration from our 15 producing mines and 64 exploration and development assets in the portfolio, before factoring in potential future transactions that would add to our growth profile.
The majority of the production expected over the five- and ten-year outlook is derived from mines that are currently in production and supported by Mineral Reserve estimates. The long-term production outlook requires minimal capital expenditures by the asset operators and a number of the development projects have been permitted, providing a low-risk outlook. The long-term production outlook requires no further funding from Triple Flag, with the exception of a $45 million staged payment with respect to Kemess upon a construction decision.
Triple Flag is a gold-focused streaming and royalty company with a diversified portfolio of streams and royalties that provides exposure primarily to gold and silver in the Americas and Australia. The company has 79 assets, including nine streams and 70 royalties. These investments are tied to mining assets at various stages of the mine life cycle, including 15 producing mines and 64 development and exploration stage projects.