China Gold International Resources intends to use the RMB3.98 billion (about US$627 million) proceeds from a newly arranged loan facility for development of the Jiama Copper-Gold Polymetallic Project in the Tibet Autonomous Region of China.
China Gold’s wholly-owned subsidiary Tibet Huatailong Mining Development has entered into a loan facility agreement with a syndicate of banks led by Bank of China as lead manager and including the Agricultural Bank of China, China Construction Bank and Bank of Tibet.
The timing and the amount of the drawdowns from the loan facility will be determined by the company according to its actual needs. The facility is repayable in full by Tibet Huatailong to the lenders on November 2029 and repayments will commence in May 2019.
The drawdowns from the loan facility bear a floating rate of interest which is currently at 2.83% per annum. The People’s Bank of China Lhasa Center Branch’s interest rate serves as a benchmark for the interest on the drawdowns. The bank’s interest rate is then discounted by 0.07% to calculate the interest on the drawdowns.
The loan facility is secured by the Jiama mine’s mining rights and is subject to customary covenants for a transaction of this nature, including covenants with respect to overall indebtedness of Tibet Huatailong.
China Gold’s CEO and executive director Bing Liu says, “This financing will enable us to successfully pursue the development of the Jiama mine. Despite challenging market conditions, we are capable of raising sizable financing at low interest rates due to our impeccable reputation in the Chinese mining industry and the support of the company’s largest shareholder, China National Gold Group Corporation.”
China Gold International Resources is based in Vancouver, BC, Canada and operates profitable and growing mines - the CSH Gold Mine in Inner Mongolia and the Jiama property. The company is listed on the Toronto Stock Exchange and the Main Board of The Stock Exchange of Hong Kong Limited.