After all, this was a company that prided itself on its ability to make assets that much bigger miners had struggled with, really sing. Here it is buying 100% of future gold and 30% of future copper and silver production from the life of mine area of an operation run by one of the biggest miners going around for $880 million.

Evolution also has to contribute 30% of future production costs in the LoM area and has agreed to pay 49% of development and production costs in return for the equivalent of 49% of future copper, gold and silver production from the Ernest Henry tenements outside the LoM area.

So it is forking over cash to a large miner with little say in how things are done there. Yes, Evolution does get certain governance rights and protections in relation to the Ernest Henry operations, including minority voting rights on the management committee director operations at the mine but Glencore largely calls the shots.

That is not how it set out to make its fortune.

Delve deeper though and the deal starts to make sense.

What Evolution has done is bring in extra gold ounces while taking a pretty big chunk out of its all-in sustaining costs. The deal reduces Evolution’s 2016-17 AISC guidance from $1000 per ounce to $930/oz.

That means the company has revised FY17 production guidance of 800,000-860,000oz at an AISC of $900/oz-$960/oz.

It also extends Evolution’s average reserve life to more than eight years.

For just a shade more than 4% of its FY16 capital expenditure Evolution is reaping 26% of its cash flow.

The Ernest Henry operation has an 11-year mine life based on current reserves and there is upside through potential mine life extension at depth and regional opportunities.

Evolution executive chairman Jake Klein said the company had gained exposure to a world-class mining asset.

“Since inception we have consistently communicated a very clear strategy of upgrading the quality of our asset portfolio to create a globally relevant, mid-tier Australian gold producer,” he said.

“The addition of low cost gold production from Ernest Henry to our portfolio gives us exposure to another high quality, long life asset that further underpins the future success of our business.”

Klein and his team at Evolution have been warning that the gold sector was getting a bit overheated so they started looking for companies mining gold but where gold was not a core commodity for them.

Evolution plans to raise $401 million through an underwritten pro-rata accelerated renounceable rights issue to partially fund the deal.

The rest will come from a $500 million term loan with a five-year tenor that is additional to the company’s existing syndicated debt facility.

Ernest Henry was commissioned as an open-cut mine in 1997 but went underground as a sub-level caving operation in late 2011.

The ore is crushed underground and brought to surface via an ore hoisting system supported by a 1km shaft and a 1.2km network of conveyors.

The Ernest Henry plant is running at 6 million tonnes per annum to 7Mtpa but has a 10Mtpa nameplate capacity.

There are plans to get the existing mine’s operation to at least 7Mtpa but to go beyond that requires feed from elsewhere.