Alamos Gold (NYSE: AGI) said on Monday it had agreed to a $116 million prepayment for gold sales in exchange for delivery of 49,384 ounces in 2025, with the proceeds to be used to close out 2024-2025 gold futures contracts previously entered into by Argonaut Gold with a total weight of 179,417 ounces.

Alamos (AGI) said the transaction eliminated more than half of Argonaut’s hedge portfolio and related mark-to-market liabilities while providing significantly greater exposure to rising gold prices.

The Company’s acquisition of Argonaut was completed last week and included Argonaut’s hedge portfolio of gold futures contracts to purchase a total of 329,417 ounces between 2024 and 2027 at average futures prices of $1,821-$1,860/oz.

The remaining Argonaut hedge portfolio inherited by Alamos (AGI) consists of futures contracts to purchase totaling 150,000 ounces in 2026-2027, and the company said it will continue to evaluate options to terminate the remaining futures contracts to purchase in 2026-2027.