Guyana Goldfields secures $185m in debt to build Aurora project
TORONTO (miningweekly.com) – TSX-listed Guyana Goldfields on Monday reported that it had secured $185-million in secured debt to finance construction of its flagship Aurora gold project, in Guyana.
The lenders, comprising International Finance Corporation (IFC), Export Development Canada, ING Capital LLC, Caterpillar Financial Services Corporation and The Bank of Nova Scotia, had agreed to disburse the loan in two tranches.
Tranche 1 covers $160-million and the second tranche entails a cost-overrun facility of $25-million. Both tranches were still subject to negotiation and settling of definitive documentation.
The maximum term of the facility is eight years and the interest rate is based upon the three-month London Interbank Offered Rate, which, based on current parameters, would be 6.3% for the Tranche 1 facility and 6.8% for the Tranche 2 facility (if drawn). There would be no gold hedging requirements or other similar provisions associated with the facility.
The lenders had set a requirement for Guyana Goldfields to fund $33-million as a precondition for disbursing the first tranche, which the company intended to fund through a private placement of 20-million common shares.
“The approval of this facility from all lenders demonstrates the strong support and confidence in the project. Our more than six years of partnership with the IFC has helped us establish an environmental, health, safety and social management system that meets international best practices.
“The project remains on schedule to achieve commercial production in mid-2015. We expect the mine to produce well in excess of three-million ounces of gold based on current reserves with average life-of-mine operating cash costs below $600/oz,” president and CEO Scott Caldwell said.
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