African Barrick Gold gets funding for Bulyanhulu expansion

FTSE 250 gold miner African Barrick Gold (ABG) has completed the financing for the expansion of its Bulyanhulu process plant in Tanzania.

ABG announced Tuesday that it has concluded negotiations with a syndicate of commercial banks for the provision of an export credit-backed term loan facility of $142m.

This will be used to fund the bulk of the cost of the construction of a new 'Carbon in Leach' circuit at the Bulyanhulu plant, one of its key growth projects, the firm said.

The plant has the capacity to process an average of 3,300 tonnes of ore per day, which equates to around 1.1m tonnes per year, the company's website says.

"The debt financing of the Bulyanhulu Process Plant Expansion is a clear example of the focus we have placed on efficient capital allocation," said Chief Executive Greg Hawkins.

"Whilst we have sufficient cash on the balance sheet to fund the expansion, we have decided to utilise a cost effective form of project financing to ensure we maintain maximum flexibility as we look to drive improved returns from our asset base."

The facility has a term of seven years and, when drawn, the spread over LIBOR will be 250 basis points.