PERTH (miningweekly.com) – Gold miner Perseus Mining has finalised the financing plan for its Yaouré gold mine, in Cote d’Ivoire, after accepting a committed letter of offer from three international banks providing $150-million in corporate debt facilities.
The consortium of banks, consisting of Macquarie Bank, South Africa’s Nedbank and The Sociéte Générale of France has offered the ASX- and TSX-listed Perseus a revolving line of credit, with interest payable being Libor plus a margin that will initially be 425% and will vary in line with the company’s leverage ratio.
Perseus will continue to hedge the sale price of its gold production in line with its applied hedging policy of no more than 30% of the projected gold production in any given year.
“The agreement to the terms of the debt facility with our banking syndicate was a critical step that needed to be completed to enable the development of the Yaouré gold mine,” said Perseus CEO and MD Jeff Quartermaine.
He noted that since acquiring the project in 2016, the company’s technical teams have created a commercial case to develop the mine, and with the international banking syndicate now providing debt finance, Perseus has put the final piece of the funding plan into place.
In addition to the $150-million corporate debt facility now secured, the $265-million Yaouré gold project would be funded by over $80-million of cash and bullion currently on hand, as well as additional contributions from future operational cash flows and proceeds from the exercise of warrants that expire later this month.
The 2017 definitive feasibility study estimated that Yaouré would produce 215 000 oz/y over its first five years of operations, with life-of-mine average all-in site costs estimated at $759/oz.
The final application for the grant of an exploitation permit to develop and operate Yaouré is due for consideration in April 10, and marks the final permit to start developing the mine.
Once the permit is granted, Perseus and the Ivorian departments of Mining and Geology and Budget and Finance will negotiate a mining convention to confirm fiscal stability and other arrangements to apply over the life of the project.
“We are looking forward to this challenge of, firstly developing Yaouré on time and on budget and then operating the gold mine in line with expectations. In addition to this, we recognize the enormous untapped exploration potential within the Yaouré tenement and with access to funding, we expect to be able to materially add to the expected life and value to investors of this operation,” said Quartermaine.