Gascoyne Resources is set to receive a loan of up to $60 million from Commonwealth Bank of Australia (CBA) and National Australia Bank (NAB) to fund the development of the Dalgaranga gold project in Western Australia.
Gascoyne Resources, through its subsidiary GNT Resources, agreed to arrange a debt facility with the banks on 50:50 basis.
The Dalgaranga project is located around 65km north west of Mt Magnet in the Murchison gold mining region and covers the majority of the Dalgaranga greenstone belt. It has a proved and probable ore reserve of 581,000 ounces of gold.
The project has an initial mine life of six years, producing an average of around 100kozpa at an average life of mine all in sustaining costs of around $1000/oz.
After completing the feasibility study, Gascoyne noted the potential to extend the mine life through near mine discoveries such as the Sly Fox resource.
Gascoyne managing director Mike Dunbar said, “Mandating tier 1 Australian lenders CBA and NAB for the debt funding required for the development of the Dalgaranga project is a strong vote of confidence in the project and the work undertaken by the Gascoyne team since we finished the Feasibility Study in November last year.
“With the mandate completed, construction will continue on schedule towards production in Q2 of next year.”
Earlier this year, Gascoyne awarded GR Engineering a $66.5 million engineering, procurement and construction (EPC) contract for the project.