Horizon Minerals Ltd (ASX:HRZ) has executed a binding term sheet agreement with Nebari Partners LLC for a US$5 million senior secured credit facility to progress the Cannon Gold Project in Kalgoorlie, Western Australia, toward development and production in 2023.
The credit facility comprises a two-tranche convertible loan facility with US$2 million in tranche 1 and US$3 million in tranche 2.
Proceeds from the facility will be used to settle the A$2.1 million deferred Cannon payment to Aurenne and to contribute to the upfront capital costs of the proposed Cannon underground mine.
“Production in 2023”
Horizon managing director Jon Price said: “It has been a pleasure to work with the team at Nebari who have worked rapidly to agree the transaction on highly competitive commercial terms enabling us to secure and advance the Cannon gold project into development and production in 2023.
“We also thank the team at Aurenne for agreeing to extend the deferred payment timing to fit in with the completion of the convertible loan facility and shareholder approval.”
Forward plan
The Cannon feasibility study demonstrated positive economic results under a contract mining and toll milling model.
Horizon continues to advance the project with regulatory approvals and tender review the main focus and a development decision is expected in the March quarter of 2023 once approvals are granted.
The company plans to utilise the contract mining and toll milling model to advance a sequence of underground developments with Cannon, Penny’s Find and Rose Hill.
Horizon aims to generate cash to support the large-scale exploration program and future mine developments across core assets in Kalgoorlie and Coolgardie.