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West African’s Sanbrado Gold Project Funded to Production
Dec. 05, 2018 01:30PM PST
West African Resources has received a financing package that will fund its Sanbrado gold project all the way through to production.
West African Resources (ASX:WAF,TSXV:AU) has received a financing package that will fund its Sanbrado gold project in Burkina Faso all the way through to production.
The company had a AU$278-million (US$200-million) finance facility approved with Taurus Funds Management on Tuesday (December 4); key terms of the facility include competitive interest rates and an ability to distribute and use free cash.
“We have worked for the past five months to get the best debt terms for shareholders. The award of the US$200 million debt mandate to Taurus follows a thorough competitive process involving technical due diligence, site visits and detailed negotiations,” West African Managing Director Richard Hyde said.
“We have one of the best undeveloped gold projects globally, an experienced project build team and we now are now fully funded and looking forward to getting Sanbrado into production in the second half of 2020,” he added.
Alongside the finance facility, West African plans to conduct an underwritten placement to raise AU$43.17 million. The placement will consist of a single tranche with 172.7 million shares in West African being issued, underwritten at AU$0.25 per share.
Finally, the company will be executing a non-underwritten share purchase plan (SPP). Eligible shareholders will be able to invest up to AU$15,000 each in the SPP, with an overall cap of AU$5 million.
The money made from the finance facility and underwritten placement will go towards funding Sanbrado’s development costs, pre-production mining costs, project financing costs and Burkina Faso taxes associated with constructing Sanbrado, along with exploration and corporate costs.
Sanbrado, the company’s flagship project, is set to see average annual production of 211,000 ounces of gold over the first five years of its anticipated 11-year mine life. Probable mineral reserves at the project stand at 20.4 million tonnes at 2.4 grams per tonne gold, containing 1.57 million ounces of gold.
West African expects the project to see first gold production in 2020’s September quarter.
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Securities Disclosure: I, Olivia Da Silva, hold no direct investment interest in any company mentioned in this article.
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