Eastern signs $25m loan for Davyhurst work

Eastern Goldfields will immediately draw down on a new $25 million facility to fund refurbishment work at its Davyhurst gold project near Kalgoorlie.

Perth-based Eastern told the market today it had finalised terms for a $25 million debt facility with Investec Australia, comprising revolving loan, equity and gold hedging components.

Eastern expects to make its first drawdown on the revolving loan component of the facility, worth $15 million, within the next week.

“This $25 million debt finance commitment means that we are now fully funded to complete refurbishment of the Davyhurst processing plant and are firmly focused on producing first gold in Q1 2017,” Eastern executive chairman Michael Fotios said.

“Refurbishment works are well advanced with more than 100 contractors mobilised on site to accelerate the construction schedule in readiness for the commencement of mining in January and subsequent commissioning of the plant.”

Eastern said it would implement the mandatory portion of the hedging program under the facility agreement, but did not have current plans to draw down on the equity loan portion of the facility.

Perth-based GR Engineering was recently awarded a $12.5 million contract to bring the Davyhurst processing facility out of care and maintenance.

Shares in Eastern were unchanged at 20.5 cents each at 10:30am.