Adriatic Metals PLC (LSE:ADT1, ASX:ADT, OTCQX:ADMLF) said its Vares Silver Project in Bosnia & Herzegovina is now fully funded to production after the company completed a US$142.5mln debt financing package with Orion Resource Partners (UK) LLP, comprising US$120mln of senior secured debt and US$22.5mln copper stream.
In addition to the Orion loan, the Vares Silver Project financing includes an institutional equity raise of US$102mln, in which Orion subscribed for US$50mln, giving it a 9.1% stake in Adriatic.
First production from Vares is expected in the second quarter of 2023, Adriatic said in a statement.
It added that the project finance debt package includes a donation by Orion to the Adriatic Foundation of US$100,000 a year to support the communities around the Vares Silver Project, with a focus on improving local education, healthcare and environmental protection.
Paul Cronin, Adriatic’s managing director and CEO, commented: “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.”
Michael Barton, portfolio manager at Orion, added: “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.”
Adriatic shares rose 2.31% to 133p in early trade.