Lundin Gold Announces Early Repayment of Gold Prepay Facility

2023-01-05 15:10:03

VANCOUVER, BC, Jan. 5, 2023 /CNW/ – Lundin Gold Inc. (TSX: LUG) (Nasdaq Stockholm: LUG) (OTCQX: LUGDF) (“Lundin Gold” or the “Company”) is pleased to announce the early repayment in full of its gold prepay credit facility (the “Gold Prepay Facility“). All amounts are in U.S. dollars unless otherwise indicated.

Pursuant to the terms of the agreement, Lundin Gold elected to prepay in full the ten remaining quarterly instalments of its Gold Prepay Facility based on the price of gold near the end of December, through the payment of $207.5 million, inclusive of applicable taxes. The Gold Prepay Facility was part of the original project financing package provided by Orion Mine Finance Group and Blackstone Tactical Opportunities in 2017 to finance the construction of Lundin Gold’s Fruta del Norte (“FDN“) gold mine in Ecuador. It was acquired by Newcrest Mining Limited, through one of its subsidiaries, in April 2020.   

Ron Hochstein, President and CEO, commented, “We believe that, combined with the strong financial performance of our operations, the early repayment of the Gold Prepay Facility gives Lundin Gold the flexibility to pursue operational and strategic opportunities for the benefit of the Company and our shareholders. This is a first step in the Company’s debt consolidation strategy, made possible by our strong treasury position and operating cash flows from the first two and a half years of operations at FDN. Going forward, it will result in increased net cash flows and will allow Lundin Gold to benefit from forecast high gold prices. We believe Lundin Gold is well positioned for a strong year ahead.”

About Lundin Gold

Lundin Gold, headquartered in Vancouver, Canada, owns the Fruta del Norte gold mine in southeast Ecuador. Fruta del Norte is among the highest-grade operating gold mines in the world.

The Company’s board and management team have extensive expertise in mine operations and are dedicated to operating Fruta del Norte responsibly. The Company operates with transparency and in accordance with international best practices. Lundin Gold is committed to delivering value to its shareholders, while simultaneously providing economic and social benefits to impacted communities, fostering a healthy and safe workplace and minimizing the environmental impact. The Company believes that the value created through the development of Fruta del Norte will benefit its shareholders, the Government and the citizens of Ecuador.

Additional Information

The information in this release is subject to the disclosure requirements of Lundin Gold under the EU Market Abuse Regulation. This information was publicly communicated on January 5, 2023 at 2:00 p.m. Pacific Time through the contact persons set out below.

Caution Regarding Forward-Looking Information and Statements

Certain of the information and statements in this press release are considered “forward-looking information” or “forward-looking statements” as those terms are defined under Canadian securities laws (collectively referred to as “forward-looking statements”). Any statements that express or involve discussions with respect to predictions, expectations, beliefs, plans, projections, objectives, assumptions or future events or performance (often, but not always, identified by words or phrases such as “believes”, “anticipates”, “expects”, “is expected”, “scheduled”, “estimates”, “pending”, “intends”, “plans”, “forecasts”, “targets”, or “hopes”, or variations of such words and phrases or statements that certain actions, events or results “may”, “could”, “would”, “will”, “should” “might”, “will be taken”, or “occur” and similar expressions) are not statements of historical fact and may be forward-looking statements. By their nature, forward-looking statements and information involve assumptions, inherent risks and uncertainties, many of which are difficult to predict, and are usually beyond the control of management, that could cause actual results to be materially different from those expressed by these forward-looking statements and information. Lundin Gold believes that the expectations reflected in this forward-looking information are reasonable, but no assurance can be given that these expectations will prove to be correct. Forward-looking information should not be unduly relied upon. This information speaks only as of the date of this press release, and the Company will not necessarily update this information, unless required to do so by securities laws.

This press release contains forward-looking information in a number of places, such as in statements pertaining to the benefits to be derived from the repayment of the Gold Prepay Facility, the outlook for gold prices and the Company’s ability to seize strategic opportunities. There can be no assurance that such statements will prove to be accurate, as Lundin Gold’s actual results and future events could differ materially from those anticipated in this forward-looking information as a result of the factors discussed in the “Risk Factors” section in Lundin Gold’s Annual Information Form dated March 21, 2022, which is available at www.lundingold.com or on SEDAR.

Lundin Gold’s actual results could differ materially from those anticipated. Factors that could cause actual results to differ materially from any forward-looking statement or that could have a material impact on the Company or the trading price of its shares include: risks associated with the Company’s community relationships; risks related to political and economic instability in Ecuador; risks related to estimates of production, cash flows and costs; the impacts of a pandemic virus outbreak; risks inherent to mining operations; failure of the Company to maintain its obligations under its debt facilities; shortages of critical supplies; control of the Company’s largest shareholders; risks related to Lundin Gold’s compliance with environmental laws and liability for environmental contamination; the lack of availability of infrastructure; the Company’s reliance on one mine; exploration and development risks; risks related to the Company’s ability to obtain, maintain or renew regulatory approvals, permits and licenses; uncertainty with the tax regime in Ecuador; risks related to the Company’s workforce and its labour relations; volatility in the price of gold; the reliance of the Company on its information systems and the risk of cyber-attacks on those systems; deficient or vulnerable title to concessions, easements and surface rights; inherent safety hazards and risk to the health and safety of the Company’s employees and contractors; the imprecision of Mineral Reserve and Resource estimates; key talent recruitment and retention of key personnel; volatility in the market price of the Company’s shares; measures to protect endangered species and critical habitats; social media and reputation; the cost of non-compliance and compliance costs; risks related to illegal mining; the adequacy of the Company’s insurance; risks relating to the declaration of dividends; uncertainty as to reclamation and decommissioning; the ability of Lundin Gold to ensure compliance with anti-bribery and anti-corruption laws; the uncertainty regarding risks posed by climate change; limits of disclosure and internal controls; security risks to the Company, its assets and its personnel; the potential for litigation; and risks due to conflicts of interest.

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