PERTH (miningweekly.com) – Gold miner Doray Minerals has rescheduled its debt repayments for its Andy Well gold project, in Western Australia, freeing up about A$12-million in cash flow.

Under the previous payment schedule with the Commonwealth Bank of Australia, Doray was required to repay A$27-million and reserve an additional A$28-million by the end of September this year, meaning that the total debt of A$55-million would effectively have been repaid 13 months after the start of production.

The debt repayments between September 2014 and September 2015 would have been funded from the debt service reserve account.

Under the new schedule, there was no change to the end date of the facility, but Doray noted that the cash reserving would cease from June this year, effectively freeing up A$12-million of cash flow from Andy Well in the six months between March and September.

Those repayments would be delayed until the second year.

MD Allan Kelly said on Tuesday that Doray was pleased that the Commonwealth Bank of Australia had recognised the strong performance of the Andy Well gold project to date.

“The new repayment schedule recognises the bank’s increased confidence level in the project and importantly, provides the company with increased access to project cash flows without any increase in the debt level or extension on the term of the loan.”

Kelly said that along with the recently completed capital raising, the new debt repayment schedule and hedging programme put Doray in a strong financial position.

Doray has put in place hedging for an additional 39 651 oz of gold, at A$1 505/oz, which would be delivered between October this year and September 2015. The period of the new hedging matched the end date of the facility and accounted for around 45% of forecast production during this time.

The Andy Well mine started production in August last year, and since that time, Doray’s net debt has been reduced from A$55-million to A$28-million at the end of March.