Gascoyne Resources has secured an agreement with Commonwealth Bank of Australia (CBA) and National Australia Bank (NAB) for $60 million in funding for its Dalgaranga gold project in Western Australia.
CBA and NAB will provide loans of $30 million each to Gascoyne for its $300 million contract project with contractor NRW Holdings ( $86 million in operating costs), which is expected to begin gold production in the second quarter of 2018.
The high-margin project has measured, indicated and inferred resources of 31.1 million tonnes at 1.3 grams of gold per tonne (1.16 million ounces total) and a proved and probable reserve of 581,000 ounces of gold.
“Finalising the debt facility with two tier one Australian lenders for the debt funding is a major step forward [and] significantly de-risks the project,” said Gascoyne managing director Mike Dunbar.
“The terms we have negotiated highlight the quality of the project and represents 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.”
The four-and-a-half year loan will begin in mid-December 2017, with an averaged hedged gold price of $1710 per ounce.