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Wheaton has committed to acquire 19.5% of payable gold production from the Koné mine, until 400,000 ounces delivery, for a total upfront cash consideration of $625 million. The sum will be paid in four equal instalments during construction. Wheaton will then reduce the amount of gold to be purchased to 10.8% until 130 additional Koz, then 5.4% for the mine’s life.
Additionally, the company is providing Montage a $75 million secured debt facility for project costs.
“With essential permits in place coupled with its impressive scale, we believe the Koné Project stands out as one of the premier gold assets in Africa,” Wheaton Precious Metals president and chief executive officer Randy Smallwood said in a separate statement.
“Supported by strong shareholder backing from the Lundin Group and Zijin Mining, the Koné Project is expected to significantly boost Wheaton’s near-term annual gold production and further strengthen our peer-leading growth trajectory,” Smallwood noted.
Zijin Mining is providing Montage with $125 million in funding, comprised of a $50m loan facility with a 9-year tenure and a $75m fully redeemable subordinated gold stream.
“We are extremely pleased to have concluded our financing through the formation of strategic partnerships with both Wheaton and Zijin who share our vision of creating a premier African gold producer,” Montage CEO Martino De Ciccio said.
“With the financing milestone now achieved, we look forward to soon launching the construction of our Koné project, which is set to become West-Africa’s next sizable, long-life, low production-cost gold mine, and poised to unlock value for all stakeholders,” De Ciccio noted.
This is Montage’s third successful financing of 2024, following an upsized private placement of $180 million in August and a $35 million placement in March.
The Koné mine is expected to produce 300,000 ounces of gold annually in the first eight years, with production starting in early 2027. The estimated mine life of Koné has been pegged at 16 years.
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