Shanta Gold Limited Singida Financing Update (3806U)
March 29 2019 - 3:00AM
UK Regulatory
TIDMSHG
RNS Number : 3806U
Shanta Gold Limited
29 March 2019
29 March 2019
Shanta Gold Limited
("Shanta Gold", "Shanta" or the "Company")
Singida Financing Update
Shanta Gold (AIM: SHG), the East Africa-focused gold producer,
developer and explorer, is pleased to provide an update on its
plans to finance the Singida Gold Mining Project ("the Project") in
Tanzania.
Highlights:
-- Singida Resources Plc ("Singida") to proceed with a targeted
US$20 million ("m") minimum equity offering via an Initial Public
Offering ("IPO") on the Dar es Salaam Stock Exchange ("DSE");
-- The IPO is expected to take 6-12 months to complete and is
the result of encouraging feedback from recent investor roadshows
by management in Tanzania, Uganda and Kenya;
-- An IPO prospectus has been submitted to the Tanzanian Capital
Markets and Securities Authority ("CMSA") and the DSE;
-- Shanta Gold will retain at least 51 per cent ownership of
Singida and will operate the Project;
-- Proposed IPO proceeds would finance the upfront capital to
bring the Project into production and provide additional funds for
exploration targeting resource expansion; and,
-- Further updates will be provided as the IPO process progresses.
On December 5(th) 2018, Shanta Gold announced the Singida
Project's economics:
-- Average annual production from open pit mining of 26,000 oz for an initial six-year period;
-- Expected to increase Shanta Gold's total gold production to
over 100,000 oz pa from first full year of production;
-- Pre-production CAPEX requirement of US$16 m and US$3 m for working capital;
-- Net Present Value ("NPV") of US$31 m and IRR of 67%, at an 8%
discount rate and using the current gold forward curve (as at 5
December 2018);
-- Life of Project Cash Cost of US$794 /oz;
-- Project economics are based on internally prepared management
estimates produced by the Singida Internal Owners Team and have not
been independently verified;
-- Significant further upside potential through the inclusion of
substantial resources currently sitting outside the project
economics; and,
-- Most key infrastructure requirements in place including
water, Tanesco grid power, resettlement and an operating camp.
Eric Zurrin, Chief Executive Officer, commented:
"As previously communicated, we are focused on bringing Singida
into production through an asset-level financing that unlocks value
for Shanta Gold shareholders while also allowing the company to
retain a controlling interest in this valuable asset. I am pleased
with the initial feedback from institutional investors across East
Africa who are seeking US dollar linked investments in support of
industrialisation.
Additionally, we are pleased to show our continued support to
Tanzania, and hope that this IPO will offer Tanzanians a rare
investment opportunity within their own mining sector.
I look forward to providing further updates throughout 2019 as
this unique funding opportunity progresses."
Enquiries:
Shanta Gold Limited
Eric Zurrin (CEO) +255 (0) 22 292 5148
Luke Leslie (CFO)
Nominated Adviser and Broker
Numis Securities Limited
Paul Gillam / John Prior / James Black + 44 (0)20 7260 0000
Financial Public Relations
Tavistock
Charles Vivian / Barnaby Hayward / Gareth
Tredway +44 (0)20 7920 3150
About Shanta Gold
Shanta Gold is an East Africa-focused gold producer, developer
and explorer. It currently has defined ore resources on the New
Luika project in Tanzania and holds exploration licenses covering
approximately 1,500km(2) in the country. Shanta's flagship New
Luika Gold Mine commenced production in 2012 and produced 81,872
ounces in 2018. The Company has been admitted to trading on
London's AIM and has approximately 787 m shares in issue. For
further information please visit: www.shantagold.com .
This announcement contains inside information for the purposes
of Article 7 of Regulation 596/2014.
ENDS
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END
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