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Fortuna to fund Lindero project construction via US$120M facility, existing cash

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Fortuna to fund Lindero project construction via US$120M facility, existing cash

Fortuna Silver Mines Inc. intends to fund construction of its Lindero gold project in Argentina through existing cash reserves, cash flow from the mine, and an up-sized US$120 million credit facility.

The company said Dec. 21 that construction of the project is estimated to cost US$239 million, including US$200 million in 2018, and US$36.5 million in 2019.

Meanwhile, Fortuna is looking at non-recourse vendor financing of US$15 million to purchase mining equipment.

The construction of the leach pad is in the bidding process, and mass earth-moving activities will kick off in February 2018, with commissioning of the pad scheduled for March 2019.

The company is working to secure municipal approval from the town of Tolar Grande to start construction activities, and formal authorization is expected in January 2018.

Lindero has been designed as an 18,750 tonnes-per-day, owner-operated, open pit mine, with a pit life of 13 years, based on existing reserves.

In the first year of full production, Lindero is expected to push Fortuna's annual production to about 9 million ounces of silver and 190,000 ounces of gold, or 340,000 gold equivalent ounces.