Excelsior raises cash for Kalgoorlie North DFS
PERTH (miningweekly.com) – Gold hopeful Excelsior Gold has agreed to a A$4-million convertible loan facility with Macquarie Bank to fund the development of the definitive feasibility study (DFS) at its Kalgoorlie North gold project, in Western Australia.
The loan facility would be accessible in two equal tranches, with the first A$2-million available on the execution of final documentation, while the second tranche was subject to the completion of a A$3-million capital raising.
The facility would be repaid in full before the end of 2015, and would have a fee of 2.5% of the facility amount.
Excelsior MD David Hamlyn said on Tuesday that the facility recognised the technical and financial merits of the Kalgoorlie North project, and was well timed for the start of a DFS.
"The company has evaluated the relative commercial costs of the facility against other market-based capital-raising methods, such as rights issues or placements, and concluded that given the premium applied to the potential exercise price of the options, the weighted average cost to capital of the Macquarie facility is highly attractive when compared to the conventional market-based funding alternatives,” Hamlyn said.
The DFS of the Kalgoorlie North project would evaluate the construction of a standalone, one-million-tonne-a-year treatment plant, as well as other possible toll mining and joint venture scenarios.
A previously completed prefeasibility study estimated that Kalgoorlie North would require a capital investment of some A$76.7-million, and would produce 456 200 oz of gold over a seven-and-a-half-year mine life.
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