TSX-listed True Gold Mining has entered into a US$100 million stream agreement with Franco-Nevada Corporation and Sandstorm Gold, which is anticipated to provide sufficient funding to complete the construction of the Karma project in Burkina Faso, West Africa.
The US$100 million Agreement requires True Gold to purchase and deliver 100,000 ounces of gold over five years, and thereafter 6.5% of equivalent production at Karma. In addition, True Gold holds the sole option to increase funding by up to US$20 million during the next 18 months. If the Increase Option is exercised in full, True Gold would deliver an additional 30,000 ounces of gold on a fixed payment schedule.
“It is a pleasure to welcome Franco-Nevada and Sandstorm and their high-calibre management teams as our newest partners on the Karma Project,” said Mark O’Dea, Executive Chairman of True Gold. “Their participation provides a strong endorsement of the project and the quality of our team. We feel this is a highly attractive funding package that is well aligned with our development plans and we look forward to working together.”
“I would also like to thank our cornerstone investors, Liberty Metals and Mining and Teck Resources, for their leadership roles in supporting the advancement of Karma over the past year. Since May 2013, during one of the toughest financing environments in recent history, True Gold has arranged approximately $200 million in funding,” said O’Dea.
“We are pleased to be partnering with both True Gold and Sandstorm in supporting the development of Karma, a robust project with low capital and operating costs on a property that has excellent exploration potential,” said Paul Brink, Senior Vice President, Business Development of Franco-Nevada. “True Gold has assembled an excellent operational team to build and operate Karma, in one of the fastest growing gold jurisdictions in the world today.”
With permits secured to build the mine envisioned in the Feasibility Study and development fully funded, True Gold’s Board of Directors has approved a construction decision and is targeting first gold pour for the end of 2015. Karma will be the seventh mine built in Burkina Faso within the past five years.
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