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Aureus Mining obtains total of $100 million of project financing
By Lisa Kerner
Charlotte, N.C., Sept. 12 - Aureus Mining Inc. announced it will receive project financing totally $88 million from Nedbank Ltd. and Rand Merchant Bank for the development of the New Liberty Gold Project in the Republic of Liberia.
Of the total, $80 million will be used for construction and $8 million to fund potential cost overruns.
The financing will be backed by the Export Credit Insurance Corp. of South Africa Ltd., according to a company news release. Final approval by the ECIC is expected by the end of the month.
The project debt facility has a six-year loan term and an overall annual cost of funding of around 5% per annum, including Libor and political and commercial risk insurance coverage. It is contemplated that up to 100,000 ounces of gold may be hedged within the framework of an agreed hedging policy.
The first draw down on the loan is anticipated in the first half of 2014.
The banks will provide the project debt facility to Bea Mountain Mining Corp., the operator of the New Liberty Project.
$12 million facility
Also, RMB Resources, a division of FirstRand Bank Ltd. (London Branch) will arrange and provide a $12 million subordinated debt facility to be used to fund the project.
This facility will have a final maturity six months after the senior facility and will have a margin over Libor of 750 basis points.
The facility terms include the issuance of warrants, with the number to be determined, exercisable at a premium of 25% to Aureus' share price.
Aureus Mining is engaged in the exploration and development of gold deposits in highly prospective and underexplored areas of Liberia and Cameroon. The company is based in Toronto.
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