Aphrodite Gold Limited announced today that Franco Nevara Corporation, the world’s largest buyer of gold royalties and stream, has advanced the Company $2,500,000 against a future royalty of 2.5% over production from the Aphrodite Gold Project near Kalgoorlie, Western Australia.
This advance, in addition to monies raised during the company’s recent share placement, will be used to help finance Aphrodite’s current pre-feasibility study on the site, which is expected to be completed by mid-2013.
Aphrodite will then begin a definitive feasibility study with a view to having production underway within the next 5 years.
Some of these funds will also be used to finance further exploration in the area, Aphrodite chairman Peter Buttigieg told Australian Mining.
According to the company this advance “bears no interest, requires no repayments for 5 years and which, provided production at the Project commences within that time, automatically converts to a 2.5% royalty.”
Aphrodite Gold Limited is one of the smaller players in the Australian mining industry, but has big ambitions to become one of our significant gold producers, and is attracting interest from foreign investors.
The involvement of a world-class company such as Franco Nevara is indicative of Aphrodite’s ability to compete effectively in this market, validating the commercial appeal of the project and assertions that Aphrodite is a company significantly undervalued by their peers.
“We are delighted at the involvement of Franco Nevada, which we see as a positive endorsement of the Project” Buttigieg said.
“Our management will keep them apprised of progress, and we will be pleased to offer them the opportunity to provide the required capital expenditure for production.”