TORONTO, ONTARIO–(Newsfile Corp. – May 31, 2023)- Minera Alamos Co., Ltd. (TSXV: Mai) (“Company” or “Minera Alamos”) is pleased to announce that it has concluded discussions with its lenders on a financing package tailored to the limited capital requirements associated with the proposed construction of the Cerro de Oro gold mine, which is currently scheduled to begin next year. increase. The Company has signed a US$15 million loan facility and US$10 million royalty term sheet, which is expected to close around July 14.th Subject to signing final documents and obtaining board and regulatory approvals.
“We are pleased to have signed this agreement which, upon successful receipt of the permit, will provide full funding to meet our planned new gold mine capital expenditure requirements. It will provide a single-source solution that will allow us to be more productive.” This has made it possible to consider lighter contract terms for greater flexibility before and during construction of the second mine. said Doug Ramshaw, president of Minera Alamos. “Furthermore, the termsheet will provide the ability to pull down a modest portion of the overall package prior to receipt of permits to support pre-construction activities planned for Cerro de Oro in 2023. This will allow our existing Treasury Department to continue to support operational activities” elsewhere, including in ongoing training campaigns and other corporate initiatives. “
Key aspects of the loan package are detailed below.
Financing package (US$15 million)
- Loan term – 3 years
- Loan Advance Fee – 2% at closing
- Loan Collateral – Consists of equity security interests in the operating subsidiaries of Cerro de Oro and La Fortuna.
- 1.25% monthly interest on loan withdrawals
- Interim Funds – US$5 million under the Loan Facility will be available for withdrawal shortly after closure to fund pre-licensing activities related to the Cerro de Oro Mine. The remaining US$10 million will be available once construction permits are granted.
Loyalty package (US$10 million)
- 2.75% of NSR of total metal production at the Cerro de Oro mine
- Royalty Redemption – Thirty months after the royalty expires, Minera may redeem 2% of the 2.75% NSR by surrendering a minimum of 3200 ounces of gold and a payment of US$6.3 million related to the NSR. If Minera exercises the Loyalty Buyback earlier than the expiration date (30 months from closing), it will be credited with 100 oz of gold per month against the minimum threshold.
- Royalty holders have an option to sell the remaining 0.75% to Minera for US$3.7 million.
- Minera and all of its operating subsidiaries will enter into purchase and sale agreements to sell at least 100% of their gold production at market prices for a period of no less than 36 months after closing.
Closing is subject to satisfactory completion of technical due diligence, completion of satisfactory documentation including but not limited to entry of security documentation, appropriate legal opinion and any other considerations that are standard for this type of facility. Subject to prerequisites.We plan to close on July 14th.thIn 2023, at that time, after receipt of authorization, interim funds may be drawn using the remaining credit and royalty facilities available to the Company.
Operational updates
The Company continued to focus development activity at Santana in the first quarter ahead of the transition to mining in the Nicho Main Zone. Some early material from the Nicho main zone has piled up on the pad, and further material from newer and much larger deposits is expected to supplement ounces from the Nicho Norte starter pit through the rest of the year. It has been. This initial material mined from the main zone pit was successfully utilized in a new series of fracturing system tests and blasting optimization studies that were very productive in the early stages of starter pit development.
The Company will continue to utilize existing pad capacity for increased mining, deposition and leaching activity pending approval of a permit amendment that will allow for substantially new pad usable areas for a strong second half of the year for gold production. I will continue. As the company prepares to expand its mining activities with its mining contractors, the company undertook a significant reduction in its accounts payable in the first quarter, reducing it to its lowest level since operations began.
Exploration drilling continues at Santana, and the first hole drilled at the previously identified Benjamin Hill target is currently documented, pending analysis. The company’s drill was relocated to the Zata target, which had never been drilled, despite several samplings of good gold grades on the surface. The company is currently conducting his second drilling operation at Zata, with further details and results to be published in a future company update.
Selected financial data
The following selected financial data are the Company’s unaudited condensed interim consolidated financial statements and related notes for the three months ended March 31, 2023 (the “Interim Financial Statements”) and management’s discussion and Summarized from analysis (“MD&A”). Three months ended March 31, 2023 (All figures are in Canadian dollars unless otherwise specified) Copies of financial statements and MD&A are available at SEDAR. www.sedar.com.
In conjunction with the adoption of International Accounting Standards (“IAS”) Amendment 16, Property, Plant and Equipment, Income Before Use, we are providing revenue and cost of sales for the period ending March 31, 2023. A detailed explanation of this new accounting rule is outlined in the financial statements (note that according to IFRS accounting rules, comparable prior year cost of goods sold for that treatment does not take into account depreciation) .
- First quarter financials reflected the decision to prioritize waste and development activities (See news release dated January 31cent2023 and May 2nd2023). Total sales were $6,784,379 and cost of sales was $3,954,831. In comparison, his Q1 2022 sales were $5,160,026 and cost of sales was $2,255,305 (Note: Revenue reflects deferred revenue of $5,514,069 from the quarter ending December 31.cent 2022. A total of $2,460,659 in quarterly revenue from the first quarter of 2023 will be treated as deferred revenue and will be included in the second quarter of 2023 financials.).
- Net income for the quarter was $1,485,884, compared to $1,067,853, or $0.002 per share, for the corresponding quarter in 2022, at $0.003 per share.
- Total cash and cash equivalents were $10,200,029 and $6,106,610 as of March 31.cent 2022 (S13,153,828 on Dec 31)cent 2022).
- Accounts payable decreased $2,315,849 from the prior year to $1,623,036 as of March 31.cent 2023 ($3,699,024 as of December 31)cent 2022).
- Total working capital was $19,890,807, compared to $15,456,020 as of March 31.cent 2022 ($18,284,236 as of December 31)cent 2022).
Minera Alamos CEO Darren Koningen, Doctor of Engineering, is responsible for the technical content of this press release based on National Instrument 43-101.
For more information, please contact us at:
Minera Alamos Co., Ltd.
Doug Ramshaw, President Viktoria Vargas de Charzynski, Vice President of Investor Relations
Phone: 604-600-4423 Phone: 289-242-3599
Email: This email address is being protected from spambots. JavaScript must be enabled to view. Email: This email address is being protected from spambots. JavaScript must be enabled to view.
Website: www.mineralalamos.com
About Minera Alamos Co., Ltd.
Minera Alamos is a gold production and development company in the process of commissioning its first gold mine with first gold production in October 2021. The company’s 100% owned Santana open pit, Heapreach mine in Sonora, is currently ramping up operations. The 100% owned Cerro de Oro gold oxide project north of Zacatecas has completed significant drilling and metallurgical work in the past and plans to enter the permitting process. Durango’s La Fortuna Open Pit Gold Project (100% owned) has completed a robust and positive Preliminary Economic Assessment (PEA) and has received major federal permits. Minera Alamos is built around an operating team that has brought three successful mines together in Mexico over the past 13 years.
Our strategy is to expand our project resources and continue to make complementary strategic acquisitions while developing very low capital investment assets.
Cautionary Note Regarding Forward-Looking Statements
This news release may contain forward-looking information and Minera Alamos acknowledges that forward-looking information is based on certain assumptions and risk factors and that actual results are not included in this news release. Readers are cautioned that they may differ materially from Alamos’ expectations. This news release contains certain “forward-looking statements” that are often, but not always, can be identified by the use of words such as “”, “may”, “”. “can”, “will”, “will”, or “plan”. These statements are based on information currently available to Minera Alamos and Minera Alamos does not provide any assurance that actual results will meet management’s expectations. Forward-looking statements include estimates and statements regarding Minera Alamos’ future plans for projects, objectives or objectives. This includes Minera Alamos’ or management’s expectation that the stated conditions or outcomes will occur and the expected timing of the release of the plan. Estimates of project resources and reserves. Forward-looking statements are based on assumptions and address future events or circumstances and, therefore, are inherently subject to risks and uncertainties. In particular, the results of exploration, the economics of treatment methods, project development, landfill and capital costs of Minera Alamos mineral properties, and the ability to complete a preliminary economic evaluation to support the technical and economic viability of the mineral. For a number of reasons, production could differ materially from those currently anticipated in such statements. Minera Alamos’ financial condition and prospects may differ materially from those currently anticipated in such statements for a number of reasons, including: and/or inability to complete updated resource and reserves estimates and preliminary economic evaluations to support technical and economic viability. mineral production. changes in general economic and financial market conditions; Changes in mineral demand and prices. litigation, legislation, environmental and other judicial, regulatory, political and competitive developments; technical and operational difficulties encountered in connection with Minera Alamos activities; Other matters discussed in this news release and filings with securities regulators. This list is not an exhaustive list of factors that may affect Minera Alamos’ forward-looking statements. These and other factors should be considered carefully, and readers should not place undue reliance on Minera Alamos’ forward-looking statements. Minera Alamos undertakes no obligation to update any forward-looking statements made from time to time by or on behalf of Minera Alamos, except in accordance with applicable securities laws.
The Company has not conducted mineral reserve feasibility studies demonstrating the economic and technical viability of the Santana Project and, as a result, whether it will achieve a specified level of mineral recovery or the cost of such recovery. uncertainty may increase. This includes the increased risks associated with developing commercially minable deposits. Historically, such projects have a much higher risk of financial and technical failure. Our inability to commence production could have a material adverse effect on our ability to generate revenues and the cash flows that fund our operations.
NEITHER TSX VENTURE EXCHANGE NOR ITS REGULATORY SERVICE PROVIDERS (AS THAT TERM IS DEFINED IN THE TSX VENTURE EXCHANGE POLICY) ARE RESPONSIBLE FOR THE SUITABILITY OR ACCURACY OF THIS RELEASE.
