TORONTO, Sept. 3, 2014 /CNW/ -Guyana Goldfields Inc. (TSX: GUY) ("GGI") and its wholly owned subsidiary, AGM Inc., (together, the "Company") are pleased to announce the signing of a common terms agreement (the "Credit Agreement") with International Finance Corporation, Export Development Canada, ING Capital LLC, Caterpillar Financial Services Corporation, and The Bank of Nova Scotia (collectively the "Senior Lenders") and other definitive documentation with respect to its previously announced credit approval for a US$185 Million (M) project finance facility (the "Project Loan Facility" or the "Facility") to fund the development and construction of, and general matters relating to, the 100%-owned Aurora Gold Project (the "Project") located in Guyana, South America (see press release dated June 9, 2014). With the completion of the Facility, the development of the Project is now fully financed, subject to the terms and conditions of the Facility.
The Project Loan Facility will consist of two tranches; a Tranche 1 facility of US$160M and a Tranche 2 cost overrun facility of US$25M. The maximum term of the Facility is eight years and advances under the Facility bear a weighted average interest rate of 3-month LIBOR plus 5.11% for Tranche 1 facility, and advances under the Tranche 2 facility would bear interest at the same average range of rates plus 0.5% (if drawn). There will be no gold hedging requirements or other similar provisions associated with the Facility.
As a condition of first disbursement, the Company is obligated to fund an additional US$33M which has been satisfied through a fully-subscribed, non-brokered private placement offering (see press release dated June 11, 2014). Management currently expects to obtain first drawdown of the Facility in September of this year.
The Honorable Robert M. Persaud, Minister of Natural Resources and the Environment for Guyana stated, "The Government of Guyana congratulates Guyana Goldfields Inc. in securing full financing for the wholly owned Aurora Gold Project. This level of investment from a large scale mining operation is important to the growth and development of the Guyanese economy. The Government of Guyana through the Ministry of Natural Resources and the Environment has been working with Guyana Goldfields to ensure that their undertaking is realized and will continue to work with this company throughout the lifetime of this project. The benefits for Guyana from this project such as local employment, contribution to national wealth, training and community development cannot be over-emphasized. In addition, Guyana's level of gold declaration is expected to double with the anticipated output from the Aurora project."
Scott A. Caldwell, President & CEO, stated, "We have been aggressively working on the construction of the Aurora Gold Project, which remains on schedule to achieve commercial production in mid-2015, and recently completed the largest single concrete pour for the SAG Mill base foundation. We would like to thank all parties involved throughout the Facility transaction."
The Company was advised by Endeavour Financial Limited (Cayman) (Financial Advisor), Cassels Brock & Blackwell LLP (Ontario Counsel), Allen & Overy LLP (US Counsel), Harridyal-Sodha & Associates (Barbados Counsel) and Luckhoo & Luckhoo (Guyanese Counsel). The Senior Lenders were advised by Shearman & Sterling LLP (US Counsel), Stikeman Elliott LLP (Ontario Counsel), Hughes, Fields & Stoby (Guyanese Counsel), Clarke Gittens Farmer (Barbados Counsel), JLT Specialty Limited (Insurance Consultant), Roscoe Postle Associates Inc. (Independent Engineer), and Golder Associates Ltd. (Independent Environmental and Social Consultants).
A copy of the Credit Agreement will be filed under Guyana Goldfields' profile on SEDAR.
About Guyana Goldfields Inc.
Guyana Goldfields Inc. is a Canadian based company, focused on the exploration and development of gold deposits in Guyana, South America. GGI is focused on the construction and development of the Aurora Gold Project scheduled for commercial production in mid-2015. The Aurora Gold Project has a total gold resource of 6.54 million ounces in the measured and indicated categories (62.83 million tonnes at 3.24 g/t Au) as well as an additional 1.82 million ounces in the inferred category (16.93 million tonnes at 3.34 g/t Au). For further details, please refer to the press release dated December 9, 2013 and the report entitled "NI 43-101 Technical Report, Updated Feasibility Study – Aurora Gold Project" dated January 29, 2013 available on SEDAR at www.sedar.com. GGI also holds a significant portfolio of attractive exploration properties and holds cash and cash equivalents of US$68M as of July 31, 2014.
This news release contains "forward-looking information" which may include, but is not limited to, statements with respect to the estimation of mineral resources. Often, but not always, forward-looking statements can be identified by the use of words and phrases such as "plans," "expects," "is expected," "budget," "scheduled," "estimates," "forecasts," "intends," "anticipates," or "believes" or variations (including negative variations) of such words and phrases, or state that certain actions, events or results "may," "could," "would," "might" or "will" be taken, occur or be achieved. Forward-looking statements are based on the opinions and estimates of management as of the date such statements are made and are based on various assumptions.
Forward-looking statements involve known and unknown risks, uncertainties and other factors which may cause the actual results, performance or achievements of the Company to be materially different from any future results, performance or achievements expressed or implied by the forward-looking statements. Such factors include, among others, the receipt of applicable regulatory approvals, the timing of the advance of the funds pursuant to the Facility, fulfilling all conditions precedent to the advance of funds pursuant to the Facility, general business, economic, competitive, political and social uncertainties; the actual results of exploration activities; changes in project parameters as plans continue to be refined; accidents, labour disputes and other risks of the mining industry; political instability; delays in obtaining governmental approvals or financing or in the completion of development or construction activities, as well as those factors discussed in the section entitled "Risk Factors" in the Company's annual information form. Although the Company has attempted to identify important factors that could cause actual actions, events or results to differ materially from those described in forward looking statements, there may be other factors that cause actions, events or results to differ from those anticipated, estimated or intended. Forward-looking statements contained herein are made as of the date of this news release and the Company disclaims any obligation to update any forward-looking statements, whether as a result of new information, future events or results, except as may be required by applicable securities laws. There can be no assurance that forward-looking statements will prove to be accurate, as actual results and future events could differ materially from those anticipated in such statements.
SOURCE Guyana Goldfields Inc.