Australia-listed Emerald Resources NL (Emerald) has achieved closure on a $60 million Okvau Debt Facility put together by Sprott Private Resource Lending II LP (Sprott), a leading financier to the global mining sector, to finance Emerald’s gold project in the region, Sprott said in a press release on Tuesday.
It said the financial close is a result of satisfying all conditions, which included extensive technical and legal due diligence. The debt project will allow Emerald to draw down on the funds with the first $10 million available immediately.
The staged drawdown of the debt facility has been scheduled to meet the project development timeline milestones.
Additionally and as a further measure of support, Sprott will purchase $3.5 million in Emerald shares at the same issue price as the recent $75 million placement on a post-consolidation basis.
The placement to Sprott was approved by shareholders on March 13. The Okvau Debt Facility has also provided access to a $100 million acquisition and development facility provided by Sprott to fund future development and acquisition opportunities as previously announced on June 26.
Managing director Morgan Hart said: “We are extremely pleased to have met another significant milestone along the development pathway for the Okvau Gold Project following the execution of all facility documentation and obtaining perfection of security for the Okvau Debt Facility.
“Additionally, Sprott’s equity commitment alongside existing shareholders serves to further strengthen the company’s financial position during current volatile market conditions related to the ongoing coronavirus.
“Significantly, Emerald has now commenced the construction of its fully funded, 100 per cent owned Okvau Gold Project and expects to achieve its stated plan of extracting its first gold from the project in the second quarter of next year,” he said.
Speaking at a press briefing on goal setting and action plans last week, General Department of Mineral Resources director general Yos Monirath said the development of the Okvau project is running smoothly despite the Covid-19 pandemic.
He said the company has finished construction on a road to the project as it works to achieve its aim of extracting its first gold. It is also building a refinery.
“We estimate that the project will be able to refine one million ounces of gold,” he said. “The ministry will continue to promote additional gold exploration licences in the area around the Okvau project and increase its business.”
Monirath said the ministry has issued 40 copper exploration licences to private companies to conduct exploration in the Kingdom.
Cambodia collected $21 million in non-tax revenue from the mining sector last year, up five per cent from 2018, Monirath said.