
Steppe Gold Ltd. (TSX: STGO) (OTCQX: STPGF) (FSE: 2J9) is very pleased to announce it has signed a binding term sheet to provide up to US$150 million in financing to fully fund the construction and completion of the Phase 2 Expansion at the ATO Gold Mine.
ATO Phase 2 Expansion Highlights:
This significant milestone is the culmination of two years of collaborative efforts with our key stakeholders in Mongolia as we successfully move forward with the Phase 2 expansion. Since our listing in 2018, the Company has been dedicated to establishing a strong social license for our sustainable mining project, aiming to create lasting value for the people of Dornod and Mongolia. The secured financing will spur employment and investment during the upcoming construction phase and sustain these benefits until at least 2036.
Recognizing the untapped economic potential within the expansive +5,500-hectare license area, the Company remains committed to an active exploration program to fully leverage its value.
The terms of the financing comprise three tranches of US$50 million each for a total of US$150 million, to be funded in line with the planned construction phase of the Phase 2 Expansion.
Financing Details
Conditions and Next Steps
Steppe Gold Chairman and CEO, Mr. Bataa Tumur-Ochir commented, “This is a significant milestone for Steppe Gold and secures the future of the ATO Gold mine for the next 14 years. It has been a challenging yet rewarding 5 years since we listed on the TSX, and the Company has been working towards unlocking the full potential of the ATO Gold Mine through the Phase 2 expansion. Most importantly, it allows the Company to move forward with all our stakeholders in Mongolia with a long-term and sustainable project in the region, with secure employment opportunities and positive economic outcomes.”
Steppe Gold Chairman and CEO, Mr. Bataa Tumur-Ochir expressed immense pride in this collaboration with TDB, its long-time banking partner and extended his gratitude to the entire TDB Group for their partnership and unwavering support in realizing their vision of developing Mongolia’s mining industry and boosting export revenues for the country.
The secured funding package will enable Steppe Gold to expedite the Phase 2 Expansion with confidence, ensuring that their objective of initiating concentrate sales in 2025 is met. During the construction phase of the expansion, the Company will maintain its production of gold and silver from the current oxide phase for a period of three years.
Jeremy South, Steppe Gold Senior Vice President and Chief Financial Officer noted, “We are very pleased to have reached agreement on a competitive lending package in a very difficult market for mine development financing. It underscores the strong fundamentals of the ATO Gold Mine and it represents a strong vote of confidence in Mongolia and in the Steppe Gold team. Importantly, it builds in flexibility in debt service and aligns the repayment schedule with the project cash flows, as well as limiting dilution in tough equity markets.”
Goh Way Chuan, Director of TDB Capital commented, “We are delighted to announce the extension of our long-standing partnership with Steppe Gold. The team at Steppe Gold has delivered on its promises and we are excited to partner with them on the Phase 2 Expansion with a flexible capital solution that matches risk and reward.”
Shaun Usmar, CEO of Triple Flag Mine Finance also commented, “As a founder investor in Steppe Gold and one of our initial stream partners, we congratulate Steppe Gold on this landmark financing for the Phase 2 Expansion at the ATO Gold Mine. We are excited to partner with TDB and Steppe Gold as they embark on this significant project.”
About Trade and Development Bank of Mongolia:
Trade and Development Bank of Mongolia is Mongolia’s oldest and leading corporate bank. The Bank acts as a primary lender to most of the Mongolian leading corporations, foreign corporations, and foreign representative offices across all major industrial and commercial sectors.
About TDB Capital
TDB Capital is an investment management company with well-diversified assets in various sectors and roots in the financial industry.
Steppe Gold Ltd.
Steppe Gold is Mongolia’s premier precious metals company.
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