Financing for the Refugio gold project in Chile is finally in hand for joint owners Bema Gold (TSE) and Amax Gold (NYSE).
Bema has been looking for financing to develop Refugio since early 1991, with Amax entering the picture in late 1992 when it purchased a 50% interest in Refugio from a Chilean company.
The Canadian Imperial Bank of Commerce, Credit Lyonnais Canada, Deutsche Bank and NM Rothschild & Sons will lend the joint venture US$80 million, subject to closing documentation, final technical due diligence and equity requirements.
The capital cost to develop Refugio is estimated at US$120 million and the joint venture expects to begin construction this October, with the first gold pour in early 1996.
Minable reserves for the initial 9.4 years of the project have been calculated at 112 million tons grading 0.03 oz. gold per ton, with a strip ratio of about 1-to-1.
At a production rate of 33,000 tons per day, the mine will produce an estimated 233,000 oz. of gold annually at a cash operating cost averaging about US$175 per oz. during the 9.4-year period. Total reserves of 204 million tons grading 0.026 oz. will extend the mine life to a total of 17.2 years.
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