WPG Resources Ltd.'s wholly owned unit Challenger Gold Operations Pty. Ltd. entered a A$20 million secured debt facility with Byrnecut Group, the mining contractor at the Challenger gold mine.
The loans will provide funds necessary to continue operations at the South Australian mine.
The two-year facility carries an interest rate of about 20% per annum and will be amortized monthly over the length of the loan.
The drawdown is expected to start before the end of December.
The company will work with the lender to deliver a mine plan focused on near term development into the Challenger Deeps area, it noted.
WPG is facing an A$8.7 million lawsuit from former mining contractor Pybar Mining Services Pty. Ltd. after the company terminated the contract.