(Kitco News) - Eldorado Gold (TSX: ELD) (NYSE: EGO) announced today that its wholly-owned subsidiary has entered into a €680 million project financing facility for the development of the Skouries project in Northern Greece with National Bank of Greece and Piraeus Bank as lead arrangers.
According to a press release, consistent with the company's previous disclosure, this term facility will provide 80% of the expected future funding required to complete the project, which is approximately half-built.
The company said that the term facility is non-recourse to Eldorado and the collateral securing the term facility covers the Skouries project and the Hellas operating assets, adding that the remaining 20% of project funding is expected to be fully covered by Eldorado's existing cash and future cash flow from operations.
Eldorado also announced that its Board of Directors has approved, conditional upon the initial drawdown of the term facility, the investment decision and full re-start of construction at Skouries.
"We are proud to be announcing the signing of this financing and the restart of construction at Skouries," commented President and CEO George Burns. "Our focus now shifts to project execution, with first production expected in the second half of 2025, followed by a ramp-up as we optimize facilities."
Eldorado noted it remains confident in the capital cost estimate of $845 million to bring the Skouries project into commercial production, and believes it is well-positioned to execute.
Skouries is located within the Halkidiki Peninsula of Northern Greece. It is a gold-copper porphyry deposit to be mined using a combination of conventional open pit and underground mining techniques. Based on the feasibility study, Skouries is expected to produce, on average, 140,000 ounces of gold and 67 million pounds of copper annually over its initial 20-year mine life.
The company said that the Skouries project has robust economics, with a 19% after-tax IRR and $1.3 billion after-tax NPV(5%), based on long-term prices of $1,500 per ounce gold and $3.85 per pound copper.
The project is expected to generate, on average, $215 million of free cash flow per year for the first five years. Eldorado noted that overall, the Skouries project has the potential to increase the company's production profile and lower its cash cost per ounce.
Eldorado is a gold and base metals producer with mining, development and exploration operations in Turkiye, Canada and Greece.
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