West Red Lake Gold Mines has secured more than C$68 million ($49.34 million) in funding to restart production at its Madsen gold mine in the Red Lake region of Ontario, Canada.
The package includes a $35 million financing facility and a $20 million stock purchase from Nebari Natural Resources Credit Fund II.
The financing facility, which carries interest at SOFR (Secured Overnight Financing Rate) plus 8% for 42 months, is subject to final documentation and due diligence.
The offering, led by Raymond James, includes approximately 29 million shares to be sold at a price of C$0.69 per share, with each unit consisting of a common share and a purchase warrant.
Proceeds from this offering will support Madsen Mine restart plans, along with working capital and corporate objectives.
Acquired in June 2023, the Madsen mine project saw West Red Lake Gold complete 40,000 meters of definition drilling, significant engineering, and exploration to support the pre-feasibility study.
The company’s test mining program has been extended through the first quarter of 2025 and precedes the transition to mining production.
The operating mill processes stockpiled bulk samples and allows adjustment of estimated and milled gold grades. The mine is expected to be operational in 2025.
“Based on our detailed internal mine plan, this financing package will provide the anticipated funding for the restart of the Madsen mine,” said Shane Williams, president and CEO. Ta.
“Upon completion of this C$68 million package, together with existing cash on hand, we will complete Madsen’s pre-feasibility study, ongoing test mining program and active capital projects underway at the mine site. We anticipate that we will be well-positioned to undertake the restart and ramp-up of the mine, including working capital and corporate requirements.
“We are working closely with our partners to address the balance of capital required for Madsen, currently estimated in our detailed in-house mine plan, and to secure the capital needs of Madsen for West Red Lake Gold shareholders. We have developed a financial package that maintains strong upside potential.”
“West Red Lake secures $49 million in financing to restart Canadian gold mine” was originally created and published by Mining Technology, a brand owned by GlobalData.
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