Akobo Minerals secures international funding for its Ethiopian gold mine project
OSLO, 09 November 2022: Akobo Minerals AB (Euronext Oslo – ticker “AKOBO”), the Scandinavian-based Ethiopian gold exploration and boutique mining company, today announced with reference to the stock exchange announcement of 10 August 2022, that it has successfully secured a US$ 8.5 million gold loan facility from US based Monetary Metals.
The net proceeds from the loan facility, secured through its wholly-owned subsidiary, Abyssinia Resources Development AS, will ensure that Akobo Minerals has the financial strength to accelerate the final phase of its mine development at Segele. Gold production is on-track to commence in early 2023.
Jørgen Evjen, CEO of Akobo Minerals, stated: “This financing agreement with Monetary Metals gives Akobo Minerals exactly what we were looking for – a loan facility that will take us through to completion of our mine and the start of gold production, while at the same time ensuring a minimal dilution of equity for our shareholders. We can now look forward to mining and production in the new year with renewed confidence.
“Furthermore, the deal with Monetary Metals shows a strong international endorsement of our gold exploration and mining project in Ethiopia. We have greatly enjoyed working with them through the process, which included taking them on a site visit to Segele to show them our developing mining operation.”
Keith Weiner, CEO of Monetary Metals, said: “Jørgen and Akobo’s management team presented us with a professional approach to running the business. Couple that with a remarkable gold deposit at Segele, and you have a very compelling economic proposition.”
The loan facility is structured as a gold loan, whereby Akobo Minerals borrows the principal amount of 5.000 ounces of gold, paid out in US$. The loan can be repaid in gold or the equivalent US$ cash amount using the applicable gold price at the time of repayment. As the loan is pegged to the gold price and also the value of the gold in the Segele deposit, it provides a natural hedge to gold price fluctuations.
The loan facility has a two-year maturity, with an annual interest rate of 22 percent. There are additional provisions regulating early repayment, which also includes a cash sweep of 50 percent of quarterly free cash flow. It is not expected that there will be any cash sweep before the second quarter of 2023. As compensation for arranging the loan facility, Monetary Metals will also be awarded warrants equal to two percent of Akobo’s equity, with a strike price of NOK 6.9 per share.
SpareBank 1 Markets is acting as financial advisor to Akobo Minerals in relation to the project financing, while Advokatfirmaet Schjødt is acting as legal advisor.
For more information, contact:
Jørgen Evjen, CEO Akobo Minerals
Mob: +47 92 80 40 14
Mail: [email protected]
LinkedIn: www.linkedin.com/company/akobominerals
Twitter: @akobominerals
Web: https://akobominerals.com
About Akobo Minerals
Akobo Minerals is a Scandinavia-based gold exploration and boutique mining company, currently holding an exploration license covering 182 km2 and with an ongoing mine development in the Gambela region and Dima Woreda, Ethiopia. The company has established itself as the leading gold exploration company in Ethiopia through more than 12 years of on-the-ground activity.
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.
Akobo Minerals has an excellent relationship with local communities all the way up to national authorities and it places environment, social and governance (ESG) at the heart of its activities - as demonstrated by an industry-leading community program.
Akobo Minerals has built a strong local foothold based upon the principles of sound ethics, transparency, and communication, and is ready to take on new opportunities and ventures as they arise. The company is uniquely positioned to become a major player in the future development of the very promising Ethiopian mining industry.
Akobo Minerals has a clear strategy aimed at building a portfolio of gold resources through high-impact exploration and mining, while adhering to a lean business operation. The company is headquartered in Oslo and is listed on the Euronext Growth Oslo Exchange under the ticker symbol AKOBO.
Akobo Minerals fully meets and complies with all parts of the JORC code, 2012. For further information, see https://www.jorc.org/
About Monetary Metals
Monetary Metals® is Unlocking the Productivity of Gold™ by offering a Yield on Gold, Paid in Gold® to investors, and Gold Financing, Simplified™ to gold-using businesses (mints, miners, refiners, jewelers, etc.). In addition, the company’s market analysis and proprietary charts, including the gold forward rate, are utilized by gold investors and gold-using businesses globally. The company’s research is widely syndicated on gold, alternative investing, and mainstream sites.
Contact:
Interested members of the press should view our media page and contact us at: [email protected] or: Joseph Finora & Associates at [email protected].
