Guyana Goldfields of Toronto has signed a credit agreement that gives it US$185 million with which to complete its Aurora gold mine on the Cuyuni River. The project is now fully funded.
The loan will consist of two tranches, US$160 million followed by an overrun facility of US$25 million, repayable over a maximum of eight years. The first tranche carries a three-month LIBOR plus 5.11% rate. Any funds advanced under the second tranche will carry the same interest plus 0.5%. Guyana completed a recent US$33 million private placement as required for release of the first tranche, and the first drawdown is expected this month.
The Aurora project contains 62.83 million measured and indicated tonnes grading 3.24 g/t Au containing 6.54 million oz of gold, plus 16.93 million inferred tonnes grading 3.34 g/t Au containing 1.82 million oz of gold. Average annual gold output is expected to be 194,000 oz over the 17-year mine life.
As a condition of first disbursement, the Company is obligated to fund an additional US$33M which has been satisfied through a fully-subscribed, non-brokered private placement offering (see press release dated June 11, 2014). Management currently expects to obtain first drawdown of the Facility in September of this year.
The Honorable Robert M. Persaud, Minister of Natural Resources and the Environment for Guyana stated, “The Government ofGuyana congratulates Guyana Goldfields Inc. in securing full financing for the wholly owned Aurora Gold Project. This level of investment from a large scale mining operation is important to the growth and development of the Guyanese economy. The Government of Guyana through the Ministry of Natural Resources and the Environment has been working with Guyana Goldfields to ensure that their undertaking is realized and will continue to work with this company throughout the lifetime of this project. The benefits for Guyana from this project such as local employment, contribution to national wealth, training and community development cannot be over-emphasized. In addition, Guyana’s level of gold declaration is expected to double with the anticipated output from the Aurora project.”
Scott A. Caldwell, President & CEO, stated, “We have been aggressively working on the construction of the Aurora Gold Project, which remains on schedule to achieve commercial production in mid-2015, and recently completed the largest single concrete pour for the SAG Mill base foundation. We would like to thank all parties involved throughout the Facility transaction.”
The Company was advised by Endeavour Financial Limited (Cayman) (Financial Advisor), Cassels Brock & Blackwell LLP (Ontario Counsel), Allen & Overy LLP (US Counsel), Harridyal-Sodha & Associates (Barbados Counsel) and Luckhoo & Luckhoo (Guyanese Counsel). The Senior Lenders were advised by Shearman & Sterling LLP (US Counsel), Stikeman Elliott LLP (Ontario Counsel), Hughes, Fields & Stoby (Guyanese Counsel), Clarke Gittens Farmer (Barbados Counsel), JLT Specialty Limited (Insurance Consultant), Roscoe Postle Associates Inc. (Independent Engineer), and Golder Associates Ltd. (Independent Environmental and Social Consultants).