The recent visits to SEMAFO-owned Mana and Boungou mines by Macquarie Bank were key conditions for drawing down the incremental $60 million.
The credit facility is repayable in eight equal quarterly instalments of $15 million, commencing 31 March, 2019. Accessing the additional funds allows SEMAFO to maintain a high level of financial flexibility.
In addition, SEMAFO has announced receipt of the mining convention for the future Boungou mine (Natougou gold project) from the Council of Ministers of the Government of Burkina Faso, which follows receipt of the mining permit in December 2016.
The convention is valid for the seven-year mine life of the initial mineral reserves at Natougou and can be renewed for additional periods of five years.
In January 2017 SEMAFO received its mining permit for the Natougou gold project.
SEMAFO said at the time that this enabled the company to develop the project on schedule. Construction activities at the project, located in south-eastern Burkina Faso, started weeks later and the first gold pour will take place in the second half of 2018.
The company announced a positive feasibility study for Natougou in February 2016, which confirmed the economic viability of an open-pit, carbon-in-pulp project delivering an after-tax IRR of 48% at a gold price of $1 100/oz.
The company describes Natougou as a “key component of its growth platform”, while it also operates the Mana mine in Burkina Faso.
At the advanced gold deposit of Natougou, SEMAFO estimates annual average gold production will be over 226 000 over the first three years, at a total cash cost of $283/oz and an all-in sustaining cost of $374/oz.