Scandinavia-based Ethiopian gold exploration company Akobo Minerals has signed a mandate letter with an international debt arranger for a contemplated loan of up to $8-million.
Pursuant to the mandate letter, the intention is to complete all conditions precedent, including a customary due diligence, site visit and agreeing on relevant documentation prior to entering into the final loan agreement. Further, it is expected that Akobo Minerals will grant the lender warrants representing 2.0% of its equity, with a strike price equal to the Akobo Mineral's share price on the Mandate Letter signing date, where such warrants will vest immediately. The contemplated loan is expected to provide Akobo Minerals with sufficient funding to complete its mining development and start production in Q1 2023.
Akobo Minerals holds a 16 km2 mining license and is working to start up mining of its very promising Segele target. It has an Inferred and Indicated Mineral Resource yielding a world-class gold grade of 22.7 g/ton, combined with an estimated all-in sustaining cost (AISC) of 243 USD per ounce. Still open at depth, the gold mineralized zone continues to expand and will have a positive impact on future resource estimates and mine-life. The exploration license holds numerous promising exploration resource-building prospects in both the vicinity of Segele and in the wider license area.
