Aspiring gold miner Kin Mining has secured a $35 million debt facility with Canada’s Sprott Private Resources Lending, completing the funding for its 1Moz Leonora gold project.

Under the terms of the three-year senior secured debt facility, Kin will make its first payment 18 months after first drawdown. The loan has an annual interest rate of eight per cent plus the greater of the US 12-month LIBOR or one per cent.

Kin Managing Director Don Harper said the facility would allow the company to immediately begin development of the $35.4 million Leonora project and set itself on a clear pathway to gold production and cashflow.

“Sprott is known to be well-versed in determining the viability of resource projects and making astute investment decisions,” he said.

Under the terms of the facility, Kin will issue 3.5 million new shares to Sprott and a 1.5 per cent net smelter royalty on the first 100,000oz of gold produced.

The facility will have no mandatory hedging requirement, no cashflow sweep and no cost overrun facility requirement.
Kin is targeting gold production in the second half of next year, at an average production rate of 55,000ozpa for an initial seven-year minelife.

Leonora is based on three open-pit mining centres delivering ore to a centrally located 1.5mtpa carbon-in-leach processing plant.

A definitive feasibility study announced in October showed Leonora would generate forecast revenue of $596.1 million over its life and surplus operating cashflow of $167.9 million, based on a gold price of $1600/oz and all-in sustaining costs of $1038/oz.

Image: Kalgoorlie Miner/  Kin Mining Chairman Trevor Dixon and Chief Executive Don Harper