Guyana Goldfields (TSE:GUY) has said that its board has approved the production plan for its Aurora Gold project, signing off on $238 million in capital expenditures.
"This is an extremely significant milestone for the project and for the company. We are excited to be moving the Aurora Gold Project forward and have engaged an excellent team whose strengths complement each other," said president and CEO Scott A. Caldwell.
The company, in a statement released earlier today, said it signed a heads of agreement and term sheet with joint venture partners for the full engineering, procurement and construction (EPC) contract of the processing facility and power plant at the Guyanese project.
The capex is contingent on project financing and other approvals, which are expected to be finalized by the second quarter of next year. It recently signed a mandate letter with the International Finance Corp of the World Bank Group for a US$165 million debt facility.
An additional unsecured debt funding offer is being considered, the company said. It had a cash balance of US$109 million as at the end of October.
In the statement, the company said management is confident that it will be able to get all the project financing necessary, and is closely monitoring its commitments to synchronize spending with the debt financing timeframe.
So far, it has spent $11 million of the $249 million required to get the project to commercial production, with Guyana Goldfields also looking at ways to reduce the capex, including contract mining, and third party operation of the power plant.
In addition, the company said it is reviewing the potential of extending open pit production and deferring the capital required for the planned underground expansion.
After tax, using a US$1,300 an ounce gold price, the project is estimated to have a net present value of $735 million, and an IRR of 31% with a 4.4 years payback period.
Construction is expected to take 18 months, with commissioning of the mill beginning in the first quarter of 2015 and commercial gold production anticipated by mid-2015.
Shares of the South American-focused company were up 4.4% within the last minutes of trading on Monday, at $1.67. So far this year, the stock has lost 47%. Reported by Proactive Investors 1 day ago.
"This is an extremely significant milestone for the project and for the company. We are excited to be moving the Aurora Gold Project forward and have engaged an excellent team whose strengths complement each other," said president and CEO Scott A. Caldwell.
The company, in a statement released earlier today, said it signed a heads of agreement and term sheet with joint venture partners for the full engineering, procurement and construction (EPC) contract of the processing facility and power plant at the Guyanese project.
The capex is contingent on project financing and other approvals, which are expected to be finalized by the second quarter of next year. It recently signed a mandate letter with the International Finance Corp of the World Bank Group for a US$165 million debt facility.
An additional unsecured debt funding offer is being considered, the company said. It had a cash balance of US$109 million as at the end of October.
In the statement, the company said management is confident that it will be able to get all the project financing necessary, and is closely monitoring its commitments to synchronize spending with the debt financing timeframe.
So far, it has spent $11 million of the $249 million required to get the project to commercial production, with Guyana Goldfields also looking at ways to reduce the capex, including contract mining, and third party operation of the power plant.
In addition, the company said it is reviewing the potential of extending open pit production and deferring the capital required for the planned underground expansion.
After tax, using a US$1,300 an ounce gold price, the project is estimated to have a net present value of $735 million, and an IRR of 31% with a 4.4 years payback period.
Construction is expected to take 18 months, with commissioning of the mill beginning in the first quarter of 2015 and commercial gold production anticipated by mid-2015.
Shares of the South American-focused company were up 4.4% within the last minutes of trading on Monday, at $1.67. So far this year, the stock has lost 47%. Reported by Proactive Investors 1 day ago.