When the going gets tough, the tough get to buying precious metals.

Industry innovator Silver Wheaton (NYSE:SLW) struck another long-term bargain last week with an agreement to purchase 25% of the life of mine silver stream from Alexco Resource (AMEX:AXU)'s Keno Hill silver district in Canada's Yukon Territory. Carrying the company's signature purchase price of beneath $4 per ounce of silver, Silver Wheaton has locked in yet another silver stream in exchange for up-front capital -- in this case, $50 million.

Alexco Resource focuses on mature or abandoned historical silver mines, combining core competencies in environmental services and remediation with an eye toward redevelopment of projects where feasible. From 1921-1988, Keno Hill produced 217 million ounces of silver, with an impressive average grade of 40.5 ounces per ton.

Development is already under way at the district's Bellekeno property, and a preliminary assessment anticipates 3.3 million ounces of silver over at least a five-year mine life. In partnership with NovaGold (NYSE:NG), which itself has uncovered world-class deposits like the Donlin Creek joint venture with Barrick Gold (NYSE:ABX), Alexco has identified more potential minesites throughout the district.

As for Silver Wheaton, I believe the announcement provides Fools with a fresh opportunity to consider the valuation of the company at today's levels. Before this deal, Silver Wheaton's share of silver stream agreements with partners like Goldcorp (NYSE:GG) and Lundin Mining (NYSE:LMC) represented 382 million ounces of proven and probable silver reserves. At today's spot price of about $11, that translates to potential revenues beyond $4.2 billion for a company trading with a market capitalization of less than $1.5 billion following today's pounding.

If silver prices begin to move higher with gold, as I believe they will, that revenue will adjust upward as well, since Silver Wheaton enjoys the unusual advantage of essentially fixed costs. I intend to offer a more detailed analysis of Silver Wheaton's valuation in the near future, but this simplified look provides some food for Foolish thought.

With the ratio of the price of gold to the price of silver approaching astronomical levels at 79-to-1, I believe it's only a matter of time before that relationship moves closer to the long-term historical average of about 20-to-1. If I am correct, this purchase agreement between Silver Wheaton and Alexco could look like a shrewd bargain indeed.

Further Foolishness:

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Fool contributor Christopher Barker captains yachts and writes about stocks. He can also be found blogging actively and acting Foolishly within the CAPS community under the username TMFSinchiruna. He owns shares in Silver Wheaton, Alexco Resource, and NovaGold. The Motley Fool has a disclosure policy.