Scandinavian gold exploration and boutique mining company Akobo Minerals has secured a convertible loan of NKr49.18-million, or about $5-million, to fund the first phase of the Segele mining operation in Ethiopia.
The remaining $7-million for the final phase of the project is contemplated to be financed from additional debt and or equity.
Akobo says it is currently progressing its assessment of several financing alternatives.
“This convertible loan provides us with sufficient flexibility to explore the optimal financial structure for the overall project, benefitting the company and all of our shareholders.
“Supported by our major shareholders, in addition to a few new faces, I feel comfortable that we will reach a very good solution to see this project through to cash flow generation," says CEO Jørgen Evjen.
“In parallel to the financing, we continue to deliver on plan with work at site on schedule.
“The processing plant design and supply phases are well under way and we expect major parts to arrive in Ethiopia within a short period. Contract mining negotiations are very advanced and we expect to break ground in October,” he adds.
The contribution of said amount, primarily from major shareholders, is structured as a short-term loan, maturing 12 months after the date of disbursement, which will be converted into shares in Akobo subject to certain conditions being met.