LUNDIN GOLD SECURES CREDIT APPROVAL FOR US$300 MILLION SENIOR DEBT
FACILITY FOR FRUTA DEL NORTE
January 22, 2018 (Vancouver, Canada) Lundin
Gold Inc. ("Lundin Gold" or the "Company") (TSX: LUG, Nasdaq
Stockholm: LUG) is pleased to announce that it has received
commitments from a syndicate of five senior lenders (the “Lenders”)
for a senior secured project finance facility (the “Facility”) of
$300 million to fund the development and construction of its Fruta
del Norte gold project in Ecuador (“Fruta del Norte” or the
“Project”). All amounts in this release are in U.S. dollars
unless otherwise indicated.
The Lenders are ING Capital LLC, Société
Générale, Caterpillar Financial Services Corporation (Cat
Financial), The Bank of Nova Scotia and KfW IPEX-Bank
GmbH.
“Together with the project financing package
from Orion Mine Finance Group and Blackstone Tactical
Opportunities, this Facility further reflects a strong endorsement
of the Project and confidence in the Lundin Gold team,” said Ron
Hochstein, President and CEO of Lundin Gold. “We look forward
to working with this supportive group of lenders as we continue to
develop Fruta del Norte. The Project remains on schedule and
on budget to achieve first gold production by the end of 2019.”
The Facility will include two tranches:
Tranche A of $100 million, to be guaranteed by an export
credit agency (“ECA”) satisfactory to the Lenders, and Tranche B of
$200 million. The term of the Facility will be eight and a
half years. There are no mandatory requirements for gold
hedging associated with the Facility.
The Facility is subject to completion of
definitive documentation, which will include customary project
finance terms, fees and conditions, a comprehensive intercreditor
agreement and completion of ongoing due diligence.
The Company is being advised on the debt
financing by Endeavour Financial. Norton Rose Fulbright
Canada LLP is acting as legal counsel to the Company with support
from the Lexim Abogados law firm in Ecuador.
About Lundin Gold
Lundin Gold, headquartered in Vancouver, Canada,
is developing its wholly-owned Fruta del Norte gold project in
southeast Ecuador. Fruta del Norte is one of the largest,
highest-grade gold projects currently under construction. The
Company’s board and management team have extensive expertise in
mine construction and operations, and are dedicated to advancing
this project through to first gold production in 2019.
The Company operates with transparency and in
accordance with international best practices. Lundin Gold is
committed to delivering value to its shareholders, while
simultaneously providing economic and social benefits to impacted
communities, fostering a healthy and safe workplace and minimizing
the environmental impact. The Company believes that the value
created through the development of Fruta del Norte will benefit its
shareholders, the Government and the people of Ecuador.
Additional Information
The information in this release is subject to
the disclosure requirements of Lundin Gold under the EU Market
Abuse Regulation and the Swedish Securities Markets Act. This
information was publicly communicated at 5:00 am Pacific Time on
January 22, 2018
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Caution Regarding Forward-Looking Information
and Statements
Certain of the information and statements in
this press release are considered “forward-looking information” or
“forward-looking statements” as those terms are defined under
Canadian securities laws (collectively referred to as
“forward-looking statements”). Any statements that express or
involve discussions with respect to predictions, expectations,
beliefs, plans, projections, objectives, assumptions or future
events or performance (often, but not always, identified by words
or phrases such as “believes”, “anticipates”, “expects”, “is
expected”, “scheduled”, “estimates”, “pending”, “intends”, “plans”,
“forecasts”, “targets”, or “hopes”, or variations of such words and
phrases or statements that certain actions, events or results
“may”, “could”, “would”, “will”, “should” “might”, “will be taken”,
or “occur” and similar expressions) are not statements of
historical fact and may be forward-looking statements.
By their nature, forward-looking statements and
information involve assumptions, inherent risks and uncertainties,
many of which are difficult to predict, and are usually beyond the
control of management, that could cause actual results to be
materially different from those expressed by these forward-looking
statements and information. Lundin Gold believes that the
expectations reflected in this forward-looking information are
reasonable, but no assurance can be given that these expectations
will prove to be correct. Forward-looking information should
not be unduly relied upon. This information speaks only as of
the date of this press release, and the Company will not
necessarily update this information, unless required to do so by
securities laws.
This press release contains forward-looking
information in a number of places, such as in statements pertaining
to: the anticipated timing of production, the negotiation and
settlement of the Facility, the anticipated terms of the Facility,
the ability of the Company to satisfy the conditions precedent to
the Facility and the planned use of proceeds from the
Facility.
Lundin Gold’s actual results could differ
materially from those anticipated. Management has identified
the following risk factors which could have a material impact on
the Company or the trading price of its shares: the ability to
arrange financing and the risk to shareholders of dilution from
future equity financings; risks related to carrying on business in
an emerging market such as possible government instability and
civil turmoil and economic instability; volatility in the price of
gold; the timely receipt of regulatory approvals, permits and
licenses; risks associated with the performance of the Company’s
contractors; risks inherent in the development of an underground
mine; deficient or vulnerable title to mining concessions and
surface rights; shortages of resources, such as labour, and the
dependence on key personnel; risks associated with the Company’s
community relationships; unreliable infrastructure and local
opposition to mining; volatility in the market price of the
Company’s shares; uncertainty with the tax regime in Ecuador;
measures required to protect endangered species; difficulty
complying with changing government regulations and policies,
including without limitation, compliance with environment, health
and safety regulations, and the cost of compliance or failure to
comply with applicable laws; exploration and development risks; the
accuracy of the Mineral Reserve and Resource estimates for FDN and
the Company’s reliance on one project; liabilities; the Company’s
lack of operating history in Ecuador; illegal mining; uncertainty
as to reclamation and decommissioning; adverse global economic
conditions; risks associated with the Company’s information
systems; the inadequacy of insurance; risks of bribery or
corruption; the potential for litigation; limits of disclosure and
internal controls; and the potential influence of the Company’s
largest shareholders.
There can be no assurance that such statements
will prove to be accurate, as Lundin Gold's actual results and
future events could differ materially from those anticipated in
this forward-looking information as a result of the factors
discussed in the "Risk Factors" section in Lundin Gold's Annual
Information Form for the financial year ended December 2016 and the
Prospectus dated December 21, 2017, both of which are available on
SEDAR at www.sedar.com.
http://prlibrary-eu.nasdaq.com/Resource/Download/5e87dc2e-9e78-48ca-a51e-0bc2ce497a52
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