January 15, 2023 – Freetown, Sierra Leone – FG Gold Limited (“FG Gold”), currently developing and constructing the Baomahun Gold Project (“Baomahun” or “Project”) in Sierra Leone, is pleased to announce it has signed a US$55 million mezzanine financing agreement (“the agreement”) with Africa Finance Corporation (“AFC”). This agreement, which was signed in December 2023, provides financing support for Baomahun during its construction phase and most importantly, along with the Engineering, Procurement and Construction Management and Commissioning Services Agreement (“EPCM”) executed with Lycopodium Minerals Canada Ltd (“Lycopodium”) in December 2023 enables FG Gold to commence major construction activities in Q1 2024.
This mezzanine financing will enable FG Gold to complete the order of key equipment packages, mobilize resources under its recently executed EPCM agreement with Lycopodium Minerals Canada Ltd, and ramp up construction of key project infrastructure. This agreement follows on from AFC’s US$45 million gold stream investment in FG Gold, making a total of US$100 million of investment in the development of Baomahun by a legacy funding partner to date. This continued partnership illustrates AFC’s commitment to supporting the sustainable development of Africa’s resources and fostering the economic growth of African countries such as Sierra Leone.
Upon completion, the Baomahun Gold Project will be a significant contributor to the economic and social development of the nation. During operations, Baomahun will account for c.10% of Sierra Leone’s gross domestic product (“GDP”), provide direct and indirect employment for up to 900 Sierra Leoneans, and stimulate local content through development of its supply chain ecosystem. In addition to the royalty and corporate income taxes which shall accrue to the Government of Sierra Leone, 1% of gross revenues shall be invested in a Community Development Fund to boost the development and growth of project affected communities through initiatives focused on social enterprise development, healthcare, water, agriculture and infrastructure. To date, FG Gold has already completed upgrade of the 66km Matotoka site access road, providing market linkages for boosting local trade; construction of the St. Joseph Bakhita Primary School; and renovation of the Baomahun Health Center.
Oliver Andrews, Executive Chairman, stated
“We would like to thank AFC for their continued unwavering support of FG Gold. This mezzanine financing is a landmark for the continued development of Baomahun and our commitment to transforming this Project into a world-class asset. As an Africa focused operator, we are particularly pleased to have partnered with one of Africa’s leading institutions as we work towards advancing the economic and social growth of Sierra Leone.”
About Africa Finance Corporation
AFC was established in 2007 to be the catalyst for private sector-led infrastructure investment across Africa. AFC’s approach combines specialist industry expertise with a focus on financial and technical advisory, project structuring, project development, and risk capital to address Africa’s infrastructure development needs and drive sustainable economic growth.
Sixteen years on, AFC has developed a track record as the partner of choice in Africa for investing and delivering on instrumental, high-quality infrastructure assets that provide essential services in the core infrastructure sectors of power, natural resources, heavy industry, transport, and telecommunications. AFC has 42 member countries and has invested US$12.7 billion across Africa since inception.
About FG Gold Limited
FG Gold is a gold development company based focused on constructing and operating the Baomahun Gold Project located in Sierra Leone. Baomahun is one of the largest deposits under development in Africa and will become Sierra Leone’s first large scale commercial gold mine. Upon operations, the Project is expected to deliver an average annual gold production of ~147,000 ounces per year over a 12.5-year mine life peaking at 234,000 ounces.
For further information, please contact:
Head of Corporate Finance & Corporate Development: Nicola Asgill | nicola.asgill@fg-gold.com