A consortium consisting of Standard Bank Plc, UniCredit Bank AG and the Finnish
state investment bank Finnvera (together the "Mandated Lead Arrangers" or
"MLAs") has approved a Senior Secured Loan Facility (the "Facility") totalling
€53 million to finance Nordic Mines' gold mine project in Laiva, near Raahe in
middle Finland.
"These commitments of the MLAs mean that we now have full funding for budgeted
investments and working capital in place to start gold mining in Laiva in
Finland. Work on the project is already progressing, with mine development,
installation of processing machinery, and the necessary infrastructure. We
expect to start operation of the mine in the summer of 2011," says Michael
Nilsson, CEO of Nordic Mines.
The gold deposit in Laiva is one of the largest in the Nordic region. The ore
reserves amount to 11.7 million tonnes with a gold content of 1.9 grams per
tonne. There are a further 4.9 million tonnes of measured and indicated resource
with an average gold content of 1.8 grams per tonne. Once the mine is fully in
operation, it is expected to generate approximately €100 million, corresponding
to approximately SEK1 billion, per year assuming current gold prices.
According to the feasibility study that was presented in March this year, the
total investment in the Laiva project will be € 70 million. There is also a
contingency of € 7 million for unforeseen costs.
"The Board and the Management of Nordic Mines are delighted that two reputable
international banks with extensive experience in mining have, after
comprehensive due diligence, committed to fund the project. This, together with
the € 30 million that Nordic Mines has already raised in two rights issues in
2008 and 2010, means that we are well placed to complete the investment in the
Laiva project," says Michael Nilsson.
The MLA's commitment provides Nordic Mines with a € 53 million Facility which is
available for drawing over a period of 24 months. € 10 million of cost overrun
funding will also be made available by way of a €6 million subordinated loan
from Finnvera and € 4 million from Nordic Mines AB. The term of the Facility is
five years with an option for early repayment. MLA Commitments are subject to
final documentation and completion of the remaining due diligence. In addition
to the Facility, Standard Bank and UniCredit will provide credit lines
to mitigate gold price, exchange rate and interest rate risk.
For further information:
Michael Nilsson, CEO Nordic Mines, +46 188 434 501, mille@nordicmines.se
Nordic Mines is a Nordic company whose operations are focused on exploring for
and mining gold. Its vision is to become one of the leading gold producers in
Europe as well as a role model in respecting the environment. Gold mining will
begin in Laiva in Finland in 2011. The gold deposit is one of the largest in the
Nordic region. Exploration is also in progress in other areas in Finland and
Sweden. Nordic Mines is based in Uppsala and its shares are traded on the Nasdaq
OMX Small Cap index. Read more at www.nordicmines.se
[HUG#1433572]
