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Greatland Gold shares jump on $235 million funding for Havieron

Havieron is located 45 km east of Newcrest’s Telfer gold-copper mine, and 500 km east of rail and port infrastructure at Port Hedland. (Image courtesy of Greatland Gold.)

Greatland Gold (LSE: GGP) has secured funding of up to A$340 million ($235m) for the development of its Havieron gold-copper deposit in Australia. The project is currently held under a joint venture with Newcrest — Australia’s largest gold producer. The proceeds will be used to fund Greatland’s 30% share of development.

The latest financing for Greatland includes commitments for seven-year debt facilities totalling A$220 million from three international banks: HSBC, Australia and New Zealand Banking Group (ANZ) and ING Bank (Australia), prior to the finalization of the Havieron feasibility study later this year.

The financing package also includes an initial equity subscription of A$60 million from Wyloo Metals, a privately owned company that invests in critical minerals, with potential for an additional A$60 million.

“The significant size of each bank’s commitment together with the strategic support from Wyloo highlights the long-term confidence in the Havieron gold-copper project and the strength of this world class asset,” Greatland Gold managing director Shaun Day said in a news release.

“The selection of ANZ, HSBC and ING as our banking partners reflects their quality as financial institutions, commitment to supporting high-quality asset development and their strong relationship commitment throughout the banking process,” he added.

Shares in Greatland Gold surged 8.7% on the London Stock Exchange’s Alternative Investment Market (AIM) following the announcement. This gives the company a market value of about £402 million ($470m).

A generational discovery by Greatland in 2018, Havieron is considered one of the biggest long-life gold-copper deposits in development worldwide, with an estimated value of over $1.2 billion.

In 2019, Greatland and Newcrest signed a four-stage $65 million farm-in agreement on the Havieron project, granting the latter the right earn a 70% interest. This partnership was expanded into a fully termed JV in 2020.

In December 2020, Newcrest announced an initial inferred mineral resource estimate for the Havieron project of 3.4 million oz. of gold and 160,000 tonnes of copper. A prefeasibility study delivered in the following year gave the project a post-tax net present value of A$706 million and 27% internal rate of return. The payback period is 3 years.

The Havieron property is located 45 km from Newcrest’s Telfer mine, which has the largest processing facility in the Paterson province and has sufficient capacity and capability to process other discoveries in this region.