Dual-listed West African gold company Teranga Gold has made its first drawdown under the secured development finance facility with Taurus Funds Management to be used towards funding the development of the Wahgnion gold project in Burkina Faso.
The Taurus Funds Management finance facility is comprised of $165 million (the PF Tranche) to be used towards funding the development of Wahgnion and to repay all of the company’s current outstanding bank debt totaling $15 million drawn on its revolving credit facility with Société Générale. The facility also includes $25 million (the GH Tranche) to be used toward future advancement of a feasibility study for the Golden Hill project.
The first drawdown under the PF Tranche was $70 million, $15 million of which was used to close out its revolving credit facility with Société Générale.
At Wahgnion, all critical long-lead equipment and key contracts have been awarded and bulk earthworks are underway with concrete installation for the mill foundation on schedule to begin in May.
“The next key pillar in our growth strategy is Wahgnion,” says Teranga Gold president and CEO Richard Young.
“With first drawdown, we are now well on our way to building our second mine, with first gold pour expected by the end of 2019. Wahgnion is expected to increase companywide production by 50% in 2020 to between 300 000 and 350 000 oz of gold.”
The facility includes a $10 million dollar carve out for equipment financing, which the Teranga Gold is pursuing and anticipates having in place prior to year-end.
All subsequent drawdowns of funds under the facility remain subject to satisfaction of customary conditions precedent. Timing of drawdowns under the GH Tranche are dependent on future drilling results from the Golden Hill project; however, there is no guarantee that all necessary conditions precedent will be satisfied or that subsequent drawdowns will occur as and when anticipate.