Mt. Labo Exploration and Development, a subsidiary of RTG Mining, has entered into a strategic partnership with Glencore International for stage one development of the high-grade Mabilo copper and gold project in the Philippines.
This binding term sheet includes offtake agreements and a financing package and will now proceed with long-form documentation.
The secured financing facility offers up to $30m in three tranches on favourable terms for stage one development and working capital needs.
Tranche A includes $3.5m for early funding flexibility to complete stage one land acquisition, with minimal conditions precedent.
Tranche B includes $21.5m for the remaining stage one development and any working capital requirements, while tranche C includes $5m for additional working capital, subject to mutual consent.
The financing facility is fully secured with guarantees from shareholders and first-ranking asset and share securities.
The offtake agreement covers 100% of the stage one products, namely gold oxide cap, copper/gold oxide skarn and supergene chalcocite.
RTG CEO Justine Magee said: “This is a very important and exciting step in the start-up of the high-grade Mabilo Copper-Gold Project and signals the transition of RTG from explorer/developer to producer.
“We are delighted to be partnering with Glencore to advance Mabilo, and the favourable finance and offtake terms also come with a strong counterparty and group that have been both active and successful themselves in the Philippines via the PASAR Refinery. We are very confident our partnership with Glencore will add significant value to Mt. Labo’s collective shareholder bases and the Philippines as a whole.”
The Mabilo Project is estimated to hold mineral resources of 12.76 million tonnes (mt) grading 1.9 grams per tonne (g/t) of gold, 1.8% copper and 40.5% iron, containing 226,800 tonnes (t) of copper and 762,500oz of gold.
Proven reserves at the project are estimated at 7.792mt, grading 2.04g/t of gold, 1.95% copper and 45.5% iron, and containing 151,900t of copper and 511,100oz of gold.
The project is due to be developed in two stages. Stage one, spanning approximately one year, will treat 578,048t of ore, producing 25,200t of copper and 52,900oz of gold.
Stage two, lasting around six years, will process 1.35mt per year, yielding 18,400t of copper, 66,800oz of gold and 346,700t of iron.
The initial steps in the development of the project involve finalising land acquisition and securing tree-cutting permits, which will pave the way for committing to the development schedule and project start-up.
