K92 Holdings International Limited will use more than US$2 million received as part of a gold prepayment agreement to assist with a restart of operations at the Kainantu Gold Project in Papua New Guinea. The proposed work includes underground mine development and refurbishment of on-site processing facilities.
The funds amounting to US$2,063,132 were received from CRH Funding II Pte Ltd and represent CRH’s third tranche advance pursuant to the prepayment agreement entered into between K92 and CRH.
The financing agreement between K92 and CRH involved a US$4.8 million gold prepayment investment and a C$3.5 million equity investment.
CRH is an affiliate of Cartesian Royalty Holdings and Cartesian Capital Group, a global private equity fund managing in excess of US$2 billion in assets.
The restart budget for the Kainantu project has been developed in partnership between K92 and CRH, including their technical consultants.
K92’s chief executive officer Ian Stalker said, “Significant progress has been made in Papua New Guinea both operationally on site and corporately, evidenced by the conditions now achieved for this third tranche advance.
“I commend our management team and staff in Papua New Guinea for this continued operational progress and at the same time, we sincerely thank the local communities for their ongoing strong support of K92’s work towards restart. K92’s progress is creating valuable jobs for the local communities and bringing investment to the region.”
In addition to K92’s experienced board and management team led by R Stuart (Tookie) Angus (chairman), Ian Stalker (CEO), and John Lewins (chief operating officer), the project has also attracted advisors familiar with this particular geological setting and the opportunity for expansion and discovery, including Barrick Gold’s former executive vice president, exploration and corporate development Alex Davidson, and Ivanhoe Mines’ former executive vice president, exploration Douglas Kirwin.
The CRH funding is in addition to a US$7,487,763 private placement conducted by Otterburn Resources in conjunction with its acquisition of K92 Mining International Limited. Otterburn advanced the net subscription proceeds realized from the sale of majority of the subscription receipts to K92 upon closing of the RTO as loans for financing its PNG operations.