K92 Mining, a Canadian gold producer, has recently announced that it has secured a $100 million loan from commodities trader Trafigura. This loan will not only strengthen the company’s financial position but also provide funds for general corporate purposes, working capital, and capital expenditures.
The loan, which will be secured by various assets of K92 Mining’s Papua New Guinea subsidiary and a pledge of shares, will have a four-year term starting from the date of the first advance of funds. It will come with competitive interest rates and include a one-year grace period for interest-only repayment.
In addition to the loan, K92 Mining has extended its off-take agreement with Trafigura. The agreement covers the production from K92’s Kainantu mine in Papua New Guinea. The extension will last for seven years, commencing in 2026 or until a minimum of 600,000 dry metric tons of concentrate have been delivered to Trafigura. As the off-take partner since the start of operations at the Kainantu gold mine, Trafigura will provide upfront payment upon delivery of concentrates to the port, as well as necessary shipping documents.
It is worth mentioning that as of June, K92 Mining had a cash position of $95.6 million and remained debt-free, indicating its strong financial position.
In conclusion, K92 Mining’s recent developments, including securing a substantial loan and amending its off-take agreement, highlight the company’s commitment to bolstering its financial standing and ensuring sustainable growth in the mining industry.