Ghana Ghana-focused gold mining company Golden Star Resources announced on Wednesday that it has successfully closed the $150 million financing with Royal Gold and its wholly-owned subsidiary RGLD Gold (RGLD), announced on 7 May 2015.

Funds received will facilitate development of Wassa and Prestea underground mines, which are expected to be in production by late 2016.

Golden Star says work on both of these projects is progressing well.

Golden Star Resources' headgear infrastructure at Prestea
Golden Star Resources’ headgear infrastructure at Prestea

The $150 million financing consists of a $130 million stream transaction with RGLD and a further $20 million term loan from Royal Gold.

Golden Star Resources received the initial upfront payment of $40 million from RGLD in relation to the stream and a further $20 million from Royal Gold in a term loan.

Golden Star Resources will immediately retire the full outstanding $38 million on its Ecobank loan I, once funds have been received from Royal Gold and RGLD.

The initial upfront payment was reduced from $55 million to $40 million as Golden Star drew down $15 million on its existing $25 million Ecobank loan II in advance of the conclusion of the financing.

The full amount of the stream transaction remains $130 million and the effective date remains 1 April 2015.

The remaining finance from the stream transaction is expected to be received incrementally as the projects’ construction advances.

Golden Star Resources expects to receive the remaining $90 million in quarterly payments between September 2015 and September 2016.

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