Orla approves construction funding for Camino Rojo
The board of TSX-V-listed Orla Mining has approved the start of construction spending at the Camino Rojo oxide gold project, in Mexico, following the closing of a $125-million credit facility.
The $125-million facility was arranged by Trinity Capital and includes a syndicate of lenders led by Agnico Eagle Mines, Pierre Lassonde and Trinity Capital, creating key alignment between debt and equity holders.
The approval of construction spending will allow for the continuation of detailed engineering and the ordering of long-lead items, such as the crushing system. Orla also approved the start of project construction, subject to receipt of all required permits.
Further, Orla reported that the Mexican federal government environment department, known as Semarnat, had granted approval of the change of land use permit – one of the two key permits required for the development of the mine.
"Securing this $125-million credit facility and one of the key permits marks two more critical milestones in the evolution of Orla, allowing us to maintain our schedule for advancing Camino Rojo toward production in mid-2021. We have accomplished a great deal to get to this point in just two years since the acquisition of the project.
“With the continued support of local communities, various levels of government, shareholders and now lenders, we can advance toward production by initiating construction in the coming months once the final permit is received," stated CEO Jason Simpson.
The construction of Camino Rojo is expected to start during the first half of 2020, upon receipt of all required permits.
A June 2019 feasibility study estimated that Camino Rojo will produce an average of 97 000 oz/y of gold and 511 000 oz/y of silver, over 6.8 years. The study estimated initial capital expenditure of $123-million.
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