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Marathon inks $185M indicative financing term sheet with Sprott for Valentine gold project

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(Kitco News) - Marathon Gold (TSX: MOZ) announced Tuesday that it has entered into an exclusive non-binding Indicative Term Sheet with Sprott Resource Lending for a senior secured project financing facility of US$185 million aimed to fund the construction of the Valentine Gold Project, located in the central region of Newfoundland and Labrador, Canada.

According to the company’s statement, the credit facility is structured as a term loan with a 6.5 year tenor. Conditions precedent to closing include the completion of technical, legal, and environmental and social due diligence, the receipt and review of the project’s final development budget and schedule, the completion of definitive documentation, and the receipt of applicable environmental permits, operating licences and regulatory approvals. Closing is scheduled for not later than March 31, 2022.

Matt Manson, President and CEO, commented, “We are very pleased to announce this significant milestone in our project financing efforts for the construction of the Valentine Gold Project. Sprott Resource Lending is an experienced and well regarded project finance partner to the mining industry, and we are excited to be working with them to develop what we anticipate will be Atlantic Canada’s largest gold mining operation.”

The company added that the detailed engineering, staffing and procurement for the Valentine Gold Project is underway, supported by its strong treasury. Construction is scheduled to commence in early 2022, subject to the timely receipt of all necessary permits and approvals.

Marathon said it recently published a Feasibility Study for the project demonstrating robust economics for a conventional open pit mining and milling operation with low initial capital cost and high rate of return. An Environmental Assessment is ongoing with federal and provincial regulators and is expected to be completed later this year.

Marathon is a Toronto based gold company advancing its 100%-owned Valentine Gold Project located in the central region of Newfoundland and Labrador, one of the top mining jurisdictions in the world. The Project comprises a series of five mineralized deposits along a 20-kilometre system. An April 2021 Feasibility Study outlined an open pit mining and conventional milling operation over a thirteen-year mine life with a 31.5% after-tax rate of return.

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