US$110M Debt Facilities For Galena’s Abra Project

HIGHLIGHTS:

• US$110M in Taurus Funds Management debt facilities for Abra Base Metals Project:
  • US$100M term loan; and
  • US$10M cost overrun facility
• Galena’s project partner Toho supports the facilities and their A$60M additional equity investment into Abra will be released alongside facility milestones
• A$20M expenditure (~12%) has already been completed on the Project and Abra site is prepared for deployment of the EPC and other key development contractors

GALENA MINING LTD. (“Galena” or the “Company”) (ASX:G1A) announces that Abra Mining Pty Limited (“AMPL”), the joint-venture company for the Abra Base Metals Project (“Abra” or the “Project”) has mandated Taurus Funds Management Pty Ltd (“Taurus”) to provide US$110 million in project financing debt facilities to be provided by its Taurus Mining Finance Fund No2 L.P. (“Lender”), made up of: a US$100 million term loan (“Project Finance Facility”); plus a US$10 million cost overrun loan (“Cost Overrun Facility”) (together, the “Taurus Debt Facilities”). Furthermore, the Taurus Debt Facilities have been approved by Galena’s co-shareholder in AMPL, Toho Zinc Co., Ltd. (“Toho”), thereby allowing the release of their final A$60 million equity investment tranche into AMPL once the facilities are in place and drawdown conditions are met.

Managing Director, Alex Molyneux commented, “The US$110 million of debt funding, together with the final A$60 million investment to be received from Toho on implementation of the facilities provides an efficient and fulsome funding package to bring the outstanding Abra base and precious metals project to fruition in a way that provides robust shareholder returns.”

TAURUS DEBT FACILITIES

The Project Finance Facility consists of a US$100 million, 69-month term loan primarily to fund capital expenditures for the development of Abra. Key terms include:

• Fixed interest of 8.0% per annum on drawn amounts, payable quarterly in arrears.
• Arrangement fee of 2.5% and commitment fee of 2.0% on undrawn amounts.
• No mandatory hedging.
• Early repayment allowed without penalty.
• US$30 million drawable until the previously announced infill drilling is complete (see Galena ASX announcement of 8 July 2020). The remainder will be drawable once the infill drilling is incorporated into the cash flow model and the model continues forecast compliance with lock up financial ratios.

Read the full press release here.

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