RE: Underground Gold This is from the Sandstorm website:
Santa Elena Gold Stream
Sandstorm has a gold stream agreement to purchase 20% of the life of mine gold production from Santa Elena at a per ounce price of US$350. Sandstorm made an upfront payment of US$12 million in cash and 700,000 common shares (3.5 million pre-consolidation) to acquire the stream in May 2009.
If SilverCrest decides to develop an underground mine, Sandstorm will have the right (but not the obligation) to purchase 20% of the payable gold from underground for an upfront payment that is equal to 20% of the upfront capital expenditures made by SilverCrest plus ongoing per ounce payments of US$450.
There is not minimum payment clause.
I asked IR the question on the stock and they told me that they needed the money to pay for the mine, they could not speculate on the price.