Thor Explorations Ltd (TSX-V:THX, AIM:THX, OTC:THXPF) told investors that it has amended and restated the terms of the balance of a $54 million senior debt facility its subsidiary Segilola Resources Operating Limited (SROL) entered into with Africa Finance Corporation (AFC) close to three years ago for the construction of the Segilola gold mine in Nigeria’s Osun State.
The company noted that Segilola started ramping up production in the fourth quarter of 2021 and achieved full commercial production at the beginning of 2022, with total annual production of 98,008 ounces (oz) of gold in the full year 2022. By 31 December 2022, SROL had repaid or cancelled $25.6 million of the Project Facility, reducing the facility outstanding to $28.4 million.
Following SROL's successful transition from project to operations, Thor said the parties engaged in discussions to revise the Project Facility to support the growth strategy of the company.
READ: Thor Explorations achieves 2022 production at top end of guidance as Segilola ramps up
Thor said the amendments under the revised agreement entered on January 31, 2023, primarily relate to the removal or relaxation of the more restrictive terms and conditions of the Project Facility, resulting in more flexibility.
The amended facility removes the project finance cash sweep requirement, releases restrictions on bank accounts and allows for free distributions from SROL (subject to a 20% distribution sweep to the Project Facility), as well as releasing the company from restrictions regarding acquisitions, distribution of dividends and certain indebtedness covenants, Thor added.
In addition, it said the amortization schedule of the facility has been re-scheduled to reduce debt repayments in 2023, so that free cashflow generated from Segilola can be used to fund growth opportunities, including advancing the company's Douta project, accelerating exploration and new business opportunities. The repayment schedule is weighted to 2024, the company said.
"We are pleased to have restated our senior debt facility which frees up Segilola's cash flow for the company to continue to implement its growth strategy and deliver value to its shareholders,” Thor president and CEO Segun Lawson said in a statement. “I would like to thank the AFC for their continued strong support of Thor. The amended facility provides a stable enabling environment for us and is aligned with the next stage of our growth strategy, and I look forward to updating the market on our progress in the coming weeks.”
Thor Explorations is a Canadian mineral exploration company engaged in the acquisition, exploration and development of mineral properties located in Nigeria, Senegal and Burkina Faso.
The company holds a 100% interest in the Segilola Gold Project and a 70% interest in the Douta Gold Project located in south-eastern Senegal.
Contact the author at stephen.gunnion@proactiveinvestors.com