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White River-area gold miner Harte Gold has totally refinanced all of its debt and gotten the province's go-ahead to increase production at its Sugar Zone Mine.
BNP Paribas is providing a debt financing package of US$72.5 million, of which $52.5 million of that is a six-year term loan. The remaining US$20.0 million is a three-year revolving credit facility.The debt repayment kicks in when the mine is producing at full capacity on March 31, 2020.
Appian Natural Resources Fund is weighing in with US$10 million equity investment. The investment is at $0.27 per common share.
In a May 6 news release, Harte Gold president-CEO Stephen Roman said this restructuring puts them on solid footing and frees them up to continue exploration in and around the Sugar Zone Mine and their almost 80,000-hectare property, just north of White River.
"With a lower cost of debt and flexible repayment schedule, the company can focus on reinvesting free cash flow generated from the mine into property-wide exploration and development.”
The company also received provincial permits in early May to increase its processing mill throughput from 540 tonnes per day to 800. That translates to gold production increasing from 41,000 ounces per year to 65,000 ounces.
Roman said landing the permits to bump up production is a "major achievement" that accelerates their timeline to move to full production sooner than forecasted, will generate more cash flow, and allows their mill to run at maximum efficiency.
Harte Gold's Sugar Zone Mine began production last fall.
As of mid-February, the deposit has an indicated mineral resource of 4,243,000 tonnes grading 8.12 grams per tonne (g/t) with 1,108,000 ounces pof contained gold, and an inferred resource of 2,954,000 tonnes, grading 5.88 g/t with 558,000 ounces.
