Wheaton Precious Metals Corp (LSE:WPM, TSX:WPM, NYSE:WPM) said it will acquire a gold and silver streaming interest in the Jervois Project in Australia from KGL Resources for $275 million, in a deal Jefferies analysts describe as highly attractive.

The transaction, structured in staged payments, will see Wheaton purchase 75% of the gold and silver produced until cumulative deliveries reach 45,000 ounces of gold and 4.3 million ounces of silver. The stream percentage then drops to 37.5% and later 25% for the life of the mine. Wheaton will pay 20% of spot prices for the deliveries.

Jefferies said the deal offers a potential internal rate of return of about 14% based on current gold and silver prices, with additional upside possible from mine life extension. The Jervois project, a high-grade copper development in Australia’s Northern Territory, is fully permitted and is expected to start construction soon, with first production targeted for the second half of 2027.

Wheaton expects to fund the acquisition with operating cash flows as construction advances, according to the company. Over the first five years, the stream is projected to add an average of 5,800 ounces of gold and 770,000 ounces of silver annually to Wheaton’s production profile. Over the life of the mine, it would contribute roughly 5,300 ounces of gold and 590,000 ounces of silver per year.

“Recent drilling and resource updates across the Rockface, Reward, and Bellbird deposits have materially expanded the resource base and highlight potential to extend mine life beyond the current plan,” Jefferies analysts wrote.

Jefferies rates Wheaton as a “Buy” with a price target of $182, representing roughly 33% upside from current levels.

The Jervois project plan contemplates both open-pit and underground operations producing around 30,000 tonnes per year of copper in concentrate, with meaningful gold and silver byproduct credits.