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Streaming transactions | 12 Months Ended
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Dec. 31, 2022
Streaming Transactions |
Streaming transactions |
| 7. | Streaming transactions
The Company entered into separate transactions to sell the cobalt and gold by-product streams mined in the Energy Transition Materials operations:
Separate transactions |  |  |  |  |  |
|  | December 31, 2022 |  | December 31, 2021
|  | Current liabilities |  | Non-current liabilities |  |
Cobalt streaming |  | 28 |  | 428 |  | 505
Gold streaming |  | 53 |  | 1,184 |  | 1,274
Contract liabilities |  | 81 |  | 1,612 |  | 1,779
a) Details of the agreements
|  | Cobalt streaming |  | Gold streaming |
Contract date |  | June 2018 |  | From 2013 to 2016 |
Product delivery |  | Product delivery started in January 2021, after the mine's ramp-up. |  | The product was delivered from the contract signature, because the plant was already operational. |
Subject |  | 75% of cobalt extracted as by-product from Voisey's Bay mine (Canada). |  | 75% of gold contained in the copper concentrate from the Salobo (Brazil) mine and 70% of the gold extracted as a by-product from the Sudbury nickel mines (Canada). |
Deadline |  | Until the mine's exhaustion, estimated for 2035. |  | Until the mine's exhaustion, estimated for 2043 and 2053 for Salobo and Sudbury, respectively. |
Counterparts |  | Wheaton Precious Metals Corp and Anglo Pacific Group. |  | Wheaton Precious Metals Corp. |
Remuneration |  | US$690 received on the contract date. Furthermore, the Company receives an amount equal to 20% (average) of the market reference price of cobalt for each pound of cobalt delivered. |  | US$3,600 received from 2013 to 2016. Furthermore, the Company receives an amount equal to the lower of (i) $400 per ounce of refined gold delivered and (ii) the reference market price on the delivery date. |
| b) | Effects on the income statement
Effects on the income statement |  |  |  |  |  |
|  | Year ended December 31,
|  | 2022 |  | 2021 |  | 2020
Cobalt streaming |  | 49 |  | 55 |  | -
Gold streaming |  | 37 |  | 43 |  | 60
Fixed revenue - Contract liabilities realized |  | 86 |  | 98 |  | 60
Cobalt streaming |  | 11 |  | 12 |  | -
Gold streaming |  | 74 |  | 82 |  | 114
Variable revenue - Additional payments received |  | 85 |  | 94 |  | 114
Accounting policy The Company bifurcates both streaming transactions in two identifiable components: (i) the sale of the mineral rights and (ii) extraction services. Sale of mineral rights – The amount allocated to this component is recognized as revenue in the income statement when the Company transfers ownership of the mineral rights to the counterparty. The cost related to the component sold is recognized in the income statement at the same moment. Extraction services – The Company recognizes contract liabilities in the event it receives payments from customers before a sale meets criteria for revenue recognition. Proceeds received under the terms of the streaming transaction allocated to this component are accounted for as “streaming transactions” and included within liabilities. Contract liability is initially recognized at fair value, net of transaction costs incurred, and is subsequently carried at amortized cost and updated using the effective interest rate method. Contract liability is released to the income statement based on the units of production, that is, revenue is calculated based on volume produced compared to the total proved and probable reserves of gold or cobalt, which are reviewed and remeasured annually. Critical accounting estimates and judgments Defining the result on sale of mineral interest and the contractual liabilities portion of the streaming transaction it is required the use of critical accounting estimates including, but not limited to: (i) allocation of costs between the product and the by-product based on relative prices; (ii) expected margin for the independent components (sale of mineral rights and service for gold and cobalt extraction); and (iii) discount rates used to measure the present value of future inflows and outflows.

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- Definition The disclosure of deferred income. [Refer: Deferred income including contract liabilities] + References Reference 1: http://www.xbrl.org/2009/role/commonPracticeRef -Name IAS -Number 1 -IssueDate 2022-03-24 -Paragraph 10 -Subparagraph e -URI https://taxonomy.ifrs.org/xifrs-link?type=IAS&num=1&code=ifrs-tx-2022-en-r&anchor=para_10_e&doctype=Standard -URIDate 2022-03-24 + Details
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