First Quantum Shares Surge on $1 Billion Royal Gold Deal (2)

First Quantum Minerals Ltd. will receive $1 billion upfront for future gold deliveries from its Kansanshi operation in Zambia, easing balance-sheet pressures triggered by the forced closure of its flagship copper mine. Its shares gained and bond yields fell.

Under the terms announced Tuesday, First Quantum will deliver gold to Royal Gold Inc. based on the volume of copper output at Kansanshi, which produces both metals. Royal Gold said it expects bullion deliveries from the arrangement to total about 12,500 ounces this year and an average 35,000-45,000 ounces over the next decade.

The deal allows First Quantum to exploit near-record ...