The company expects to achieve first production from the silver project in the second quarter of 2023
Adriatic Metals announced that its 100% owned Vares silver project in Bosnia & Herzegovina is now fully funded, following the signing of a $142.5m debt financing package with Orion Resource Partners (UK).
The financing package comprises $120m senior secured debt and $22.5m copper stream.
As per the 2021 project definitive feasibility study (DFS) taken up by Adriatic Metals, the Vares silver project will see a capital expenditure of $168m.
Adriatic Metals expects to achieve first production from the silver project in Q2 2023.
Adriatic Metals managing director and CEO Paul Cronin said: “Adriatic Metals has entered a new phase with the Vares Silver Project fully funded through to production.
“This significantly de-risks the Company and puts us in a strong position to become Europe’s next miner, providing the continent with locally sourced, strategic metals.
“We are delighted to have Orion on board and believe it’s a strong validation of the potential of the Vares Silver Project.”
According to Adriatic Metals, the first draw down of the debt package with Orion Resource Partners is anticipated to occur in Q2 2022 after the company meets customary conditions precedent to financial close.
Last October, Adriatic Metals raised $102m for the Vares silver project through institutional equity raise. Orion Resource Partners had subscribed for $50m worth shares in the institutional equity raise, to take a 9.1% stake in the UK-based precious and base metals developer.
Orion Resource Partners portfolio manager Michael Barton said: “We are delighted to have completed the project financing with Adriatic, which marks the culmination of a significant amount of work from both our respective teams.
“Since we were first introduced to the Project in 2018, we have been impressed by the Project’s potential. We very much look forward to developing our working relationship with the Company and assisting in realising that potential as Adriatic evolves.”
The 2021 DFS mine plan of Adriatic Metals focuses on mining the high-grade sections of the Rupice deposit and supplying consistent high-grade feed to the Vares processing plant.
Adriatic Metals has exploitation permits in place for both the Rupice underground deposit and the Veovaca open pit deposit.