"Full speed ahead with construction"
Shares in Lundin Gold declined Tuesday after the company announced a $400–$450 million project financing package for its 100%-owned Fruta Del Norte project in Ecuador. After a jump at the start of trading, in afternoon dealings on the TSX the Vancouver-based company was exchanging hands for $6.16 down 1%, amid a generally lacklustre day on the gold market. Lundin Gold is worth $736.7 million after a 17% year to date gain reports Mining News.
In a statement Lundin Gold said the project finance package agreed with private equity groups Orion Mine Finance and Blackstone Tactical Opportunities is a sign of "growing support for mining investment in Ecuador."
According to Lundin Gold the financing is comprised of a gold prepay credit facility for $150 million, a stream loan credit facility of $150 million and committed participation of $100 to $150 million to future equity financings required to fund the project. The streaming deal is repayable in variable monthly principal and interest instalments equivalent to the delivery of 7.75% of gold production and 100% of the silver production starting in December 2020, up to a maximum of 350,000 oz of gold and six million oz of silver according to the statement.
Lundin Gold President and CEO Ron Hochstein said the agreement "confirms the strength of this project and gives us the ability to move full speed ahead with construction."
