TSX: ASO
AIM: ASO
TORONTO, Feb. 21, 2018
/CNW/ - Avesoro Resources Inc. ("Avesoro" or the "Company"), the
TSX and AIM listed West African gold producer, is pleased to
announce that further to the Company's news announcement dated
December 12, 2017, its wholly owned
subsidiary Bea Mountain Mining Corporation ("BMMC") has entered
into further equipment finance facility agreements ("Finance
Agreements") with Mapa İnşaat ve Ticaret A.Ş. ("Mapa"), a related
party of the Company, to facilitate the purchase of heavy mining
equipment ("HME") and additional auxiliary equipment totalling
approximately US$10.3 million, as
anticipated in the recently updated life of mine schedule announced
on October 11, 2017.
Equipment to be purchased
The Finance Agreements totalling approximately US$10.3 million, relate to the purchase of two
Komatsu PC1250 excavators, eight Komatsu HD785 haul trucks and
auxiliary support equipment including a Komatsu GD655 grader and
Komatsu D155A 6R dozer. Delivery to New Liberty is expected to
occur throughout the remainder of Q1 2018.
Financing terms
The loan principal of these agreements includes a mark-up of
2.5% over the cost incurred by Mapa in procuring the equipment. The
equipment finance loans under each of the Finance Agreements are
unsecured, with interest charged at 6.5% per annum. The loans are
repayable in cash in eight equal semi-annual instalments, the first
of which will fall due six months after utilisation of the
loan.
Novation of US$35 million loan
facility
BMMC has agreed to novate to Avesoro Resources Inc. the
previously announced US$35 million
loan agreement with Avesoro Jersey Limited, the Company's majority
shareholder, dated July 13, 2017. All
terms of the loan facility remain as previously announced, namely
that the Company may draw down up to the full US$35 million in multiple tranches at the
Company's discretion before 31 December
2020, with funds available for general working capital
purposes. To date, US$18.8 million of
this loan facility has been drawn. The facility is unsecured and
ranks subordinated to the Company's existing
facilities. Interest will be charged on drawn amounts at a
fixed rate of 3.75% per annum. The facility is due to repaid in
full no later than 31 December 2022
and has no early repayment penalty.
Opinion of the Independent Directors
The independent directors of the Company, consisting of Mr.
Loudon Owen, Mr. David Netherway and Mr. Jean-Guy Martin consider, having consulted with
the Company's Nominated Adviser, that the terms of the transactions
are fair and reasonable insofar as its shareholders are
concerned.
Disclosure of other related party transactions
Further to the Company's announcement dated December 12, 2017, in accordance with the AIM
Rules, the Company discloses, at this time, the following smaller
related party transactions that it has entered into during the past
two months with entities within the MNG Group:
Technical and managerial services provided to Avesoro
Jersey Limited ("AJL") by the Company and
Avesoro Services (UK) Limited ("ASUL")
Over the last two months, the Company and ASUL have provided
technical and managerial services to AJL to support the other gold
mines operated by Avesoro Jersey, the Youga Gold Mine and Balogo
Gold Mine (prior to the acquisition by the Company on December 18, 2017) and the Kokoya Gold
Mine. These services are recharged to AJL on a monthly basis
at a mark-up of 5% over the cost incurred by the Company and ASUL
in providing these services. The total value of these
services provided over the last two months is approximately
US$114,000, payable in cash.
Drilling services provided to Burkina Mining Company SA
("BMC"), Netiana Mining Company SA ("NMC") and MNG Gold Burkina
SARL ("MNGGB") by Faso Drilling Company SA
Since the acquisition of the Youga Gold Mine and Balogo Gold
Mine on December 18, 2017, BMC, NMC
and MNGGB have incurred costs of US$1.2
million (which will be paid in cash) for 18,500 metres of
diamond drilling with Faso Drilling Company SARL, a related party
to the Company.
Charter plane services provided to BMMC by MNG Gold Liberia
Inc.
Over the last two months, BMMC has chartered flights from MNG
Gold Liberia Inc. ("MNGGL"), a member of the MNG Group of
companies. BMMC undertook a benchmarking exercise and agreed
an hourly rate to be paid to MNGGL in respect of these services and
is charged US$3,000 per flying
hour. The total value of these services provided over the
last two months is approximately US$60,000, payable in cash.
About Avesoro Resources Inc.
Avesoro Resources is a West
Africa focused gold producer and development company that
operates three gold mines across West
Africa and is listed on the Toronto Stock Exchange ("TSX")
and the AIM market operated by the London Stock Exchange ("AIM").
The Company's assets include the New Liberty Gold Mine in
Liberia (the "New Liberty Gold
Mine" or "New Liberty") and the Youga and Balogo Gold mines in
Burkina Faso ("Youga" and
"Balogo").
New Liberty has an estimated proven and probable mineral reserve
of 7.4Mt with 717,000 ounces of gold grading 3.03g/t and an
estimated measured and indicated mineral resource of 9.6Mt with
985,000 ounces of gold grading 3.2g/t and an estimated inferred
mineral resource of 6.4Mt with 620,000 ounces of gold grading
3.0g/t. The foregoing Mineral Reserve and Mineral Resource
estimates and additional information in connection therewith is set
out in an NI 43-101 compliant Technical Report dated November 1, 2017 and entitled "New Liberty Gold
Mine, Bea Mountain Mining Licence Southern Block, Liberia, West
Africa" and is available on SEDAR at www.sedar.com.
Ndablama has an estimated indicated mineral resource of 7.6Mt
with 386,000 ounces of gold grading 1.6 g/t and inferred mineral
resource of 9.6Mt with 515,000 ounces of gold grading 1.7
g/t. Weaju has an inferred mineral resource of 2.7Mt
with178,000 ounces of gold grading 2.1 g/t. The foregoing Mineral
Resource estimates and additional information in connection
therewith is set out in an NI 43-101 compliant Technical Report
dated December 1, 2014 and entitled
"Ndablama and Weaju Gold Projects, Bea Mountain Mining Licence
Northern Block, Liberia,
West Africa" and is available on
SEDAR at www.sedar.com.
Youga and Balogo have a combined estimated proven and probable
mineral reserve of 9.3Mt with 513,000 ounces of gold grading 1.7g/t
and a combined estimated indicated mineral resource of 16.05Mt with
801,600 ounces of gold grading 1.55g/t and a combined inferred
mineral resource of 13Mt with 655,000 ounces of gold grading
1.57g/t. The foregoing Mineral Reserve and Mineral Resource
estimates and additional information in connection therewith is set
out in two NI 43-101 compliant Technical Reports, dated
June 16, 2017 entitled "Mineral
Resource and Mineral Reserve Update for the Balogo Project" and
dated June 19, 2017 and entitled
"Mineral Resource and Mineral Reserve Update for the Youga and
Ouaré Projects" and are available on SEDAR at www.sedar.com.
For more information, please visit www.avesoro.com
Qualified Persons
The Company's Qualified Person is Mark
J. Pryor, who holds a BSc (Hons) in Geology & Mineralogy
from Aberdeen University, United Kingdom and is a Fellow of the
Geological Society of London, a
Fellow of the Society of Economic Geologists and a registered
Professional Natural Scientist (Pr.Sci.Nat) of the South African
Council for Natural Scientific Professions. Mark Pryor is an independent technical
consultant with over 25 years of global experience in exploration,
mining and mine development and is a "Qualified Person" as defined
in National Instrument 43 -101 "Standards of Disclosure for Mineral
Projects" of the Canadian Securities Administrators and has
reviewed and approved the scientific and technical disclosures
contained in this announcement.
SOURCE Avesoro Resources Inc.