RE:Can we help you Matt?Event This morning, Marathon provided an update on certain project financing arrangements for its Valentine Gold Project (100%) in central Newfoundland.
Impact: NEUTRAL Marathon reported that it has extended its right to repurchase 0.5% of the 2% NSR royalty (on Valentine) from Franco Nevada (FNV-T) for US$7mm to January 31, 2023 (from December 31, 2022).
As a reminder, on March 31, Marathon announced the closing of a US$185mm credit facility from a non-bank lender, subject to certain conditions. An initial advance of US$125mm of the Facility was funded into a debt proceeds account (DPA) upon close. These funds remain undrawn from the DPA.
The company and its non-bank lender have negotiated adjusting the effective date for certain terms and conditions of the credit facility to January 31, 2023 from December 31, 2022 (Marathon is trying to increase the Facility).
As a reminder, on December 7 (see Flash Note), Marathon released the highlights of an updated Feasibility Study (FS) for its Valentine Gold Project. The updated FS contemplates average annual production of 179 koz/year at AISC of US$1,046/ oz. Pre-production capital expenditures were estimated at C$463mm
Management previously reported that it expects mobilization for principal civil works to commence in January 2023, with first gold anticipated in Q1/25.
As at September 30, the company had C$164mm of cash and no debt. The company previously announced that it has a US$81mm commitment letter with Caterpillar Financial Services Limited for equipment lease finan