Steppe Gold (TSX:STGO) announced a major drawdown of US$9.6 million from a US$150 million financing package in October to accelerate the construction and development of Phase 2 of its producing ATO gold mine in Mongolia.
Steppe Gold Director and Executive VP Aneel Waraich considers it a big win and a significant endorsement for the company’s operating team in the country.
“(In) early summer, we put out a US$150 million financing announcement, which allows us to be fully funded for our Phase 2 expansion,” Waraich said. “We now reconfirmed by confirming we’ve drawn down on the first US$10 million of it. It shows how real that package is, and I think that may be what investors are looking for.”
Part of the funding was provided by the Trade and Development Bank of Mongolia through an initial US$50 million loan approved for equipment and long lead items. The payback period starts upon completion of the Phase 2 expansion, which is targeted for late 2025.
“What Phase 2 looks like today is a 12 year mine life at over 100,000 ounces per annum on a gold equivalent basis,” he said. “So that’s the real prize, the real production and cash machine for the company.”
Phase 1 heap leach operations currently produce approximately 30,000 ounces gold equivalent per year. Steppe Gold earlier announced it had passed the milestone of 100,000 ounces of gold produced at the ATO mine.
Watch the full interview with Steppe Gold Director and Executive Vice President Aneel Waraich above.
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