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Thor Explorations Ltd (2)
Symbol C : THX
Shares Issued 370,682,965
Close 2019-04-15 C$ 0.16
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Thor to receive $78M (U.S.) Africa Finance investment

2019-04-15 09:34 ET - News Release

Mr. Segun Lawson reports

THOR SIGNS INVESTMENT COMMITTEE APPROVED TERM SHEET FOR US$78 MILLION FINANCING WITH AFRICA FINANCE CORPORATION FOR THE CONSTRUCTION OF THE SEGILOLA GOLD PROJECT

Thor Explorations Ltd. has received investment committee approval for, and the company has executed on, an agreed term sheet with the Africa Finance Corp. for a $78-million (U.S.) financing package for the construction and ramp-up of its 100-per-cent-owned Segilola gold project in Nigeria. This follows the completion of the project definitive feasibility study (DFS) announced on Feb. 4, 2019.

The financing is subject to mutually satisfactory documentation, AFC board approval, completion of due diligence and other customary conditions precedent, which are expected to be completed in May, 2019.

Highlights:

  • Total financing of $78-million (U.S.);
  • $54-million (U.S.) senior secured credit facility, a $9-million (U.S.) gold stream prepayment and a $15-million (U.S.) equity investment from AFC;
  • Introduction of a new strategic investor into Thor -- AFC, a pan-African multilateral development finance institution;
  • Thor to proceed with turnkey engineering procurement and construction (EPC) contract finalization and start of construction works with first production targeted within 18 months of EPC commencement.

For the company to be fully financed to production, including financing costs, cost overrun capacity, general corporate purposes and other exploration activities during the construction period, the company will also be seeking to raise an additional $18-million (U.S.) from debt or equity sources.

Segun Lawson, president and chief executive officer of Thor Explorations, stated: "This is an extremely significant milestone for Thor and for the mining sector of Nigeria. Our DFS demonstrated the robustness of the Segilola gold project, and now we are pleased and looking forward to partnering with AFC as both a lender and a long-term shareholder of Thor. Our vision for the Segilola project is aligned and we look forward to successfully implementing this landmark project in Nigeria."

Senior secured credit facility:

  • Five-year term from financial close;
  • 21-month moratorium after financial close on principal;
  • Interest rate of London Inter-bank Offered Rate plus 9.0 per cent;
  • Issue of 17,602,941 ordinary shares issued to AFC (subject to regulatory approvals);
  • The facility is secured against assets of Thor's wholly owned subsidiary, Segilola Resources Operating Ltd., and is guaranteed by Thor until fulfilment of certain milestones.

Gold stream agreement:

  • $9-million (U.S.) deposit;
  • The stream applies to 4.4 per cent of gold production where the company will receive 30 per cent of the prevailing market price up to a maximum of 2.25 times money multiple on the deposit amount.

Offtake agreement:

  • Applies to 95.6 per cent of gold production up to the maximum recoverable ounces at financial close.

Equity placement:

  • AFC to purchase 99.75 million of Thor's ordinary shares through a placement at a purchase price of 20 cents per share for $19.95-million (Canadian) ($15-million (U.S.)).

About Thor Explorations Ltd.

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. Thor holds a 100-per-cent interest in the Segilola gold project located in Osun state of Nigeria and a 70-per-cent interest in the Douta gold project located in southeastern Senegal. Thor also holds a 49-per-cent interest in the Central Hounde project located in Hounde greenstone belt in southwest Burkina Faso.

About Africa Finance Corp.

Africa Finance, an investment-grade multilateral finance institution, was established in 2007 with an equity capital base of $1-billion (U.S.) to be the catalyst for private-sector-led infrastructure investment across Africa. AFC has a current balance sheet size of approximately $4.5-billion (U.S.) and is the second-highest investment-grade-rated multilateral financial institution in Africa with an A3 (stable outlook) rating from Moody's Investors Service. AFC invests in high-quality infrastructure assets in Africa that provide essential services in the core infrastructure sectors of power, natural resources, heavy industry, transport and telecommunications.

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