Liberian gold is financially backed by South African banks
Aureus Mining Inc., a gold mining company with operations in West Africa, particularly in Liberia, has secured a significant debt finance facility from South African banks to fund its gold project. The financing, amounting to US$88 million, is provided by Nedbank and First Rand Bank.
The debt facility, backed by the Export Credit Insurance Corporation of South Africa (ECIC), has a term of six years with a two-year grace period. This financing comes as a result of Aureus Mining's high-quality asset and the strength of its management team, according to CEO, David Reading.
The gold project, with an operating cost of US$685 per ounce of gold, boasts a quick payback period of 2.2 years at an average gold price of US$1,400/oz. The project's bankable feasibility study has already been completed.
The debt finance is expected to help fund operational costs and development of the gold project, potentially enhancing its viability. It could also provide stability and reduce financial risk if managed effectively.
The debt facility is not the only source of funding for Aureus Mining. The company has also secured additional financing from First Rand Bank, amounting to US$12 million in subordinated debt.
Nedbank is also planning to streamline its Supply Chain Finance (SCF) offering with China Systems software. However, details about this aspect are not yet available.
Aureus Mining expects to begin producing gold in Q1 2015, with projections of producing 120,000 ounces of gold over the first four years and 93,000 ounces of gold over the last four years.
The debt finance facility is a significant development for Aureus Mining, providing it with the necessary funds to move forward with its gold project in Liberia. Further details about the company's financial health, strategic partnerships, and impact on its operations will likely be revealed in future financial reports and corporate announcements.
The debt finance facility, supported by the Export Credit Insurance Corporation of South Africa (ECIC), is contingent on credit insurance from an export credit agency, enhancing Aureus Mining's ability to secure financing from various sources within the industry. Proper management of this financing could potentially increase the industry's confidence in the viability of Aureus Mining's gold project, contributing to a stable financial position and reducing risks associated with the industry's finance sector.
