Emerging miner Southern Cross Goldfields expects to secure the $25 million it needs to finance its Marda gold project early next year.
The explorer on Monday signed the formal sale agreement for the acquisition of the Sandstone gold project from South American-focused Troy Resources which now holds a strategic 15 per cent interest in Southern Cross.
The deal included a 600,000tpa processing plant and 100-person camp which should halve the capital costs of developing Marda, 150km north of Southern Cross, from $51m to $25m.
Managing director Glenn Jardine says the company has short-listed financiers which will now enter into a due diligence process to be completed in January, at which time final financing terms are expected.
Mr Jardine says Marda – on track to pour its first gold bar late next year – is projected to deliver initial production of 35,000ozpa at an average cash operating cost of $880/oz.The project should generate annual operating cash flows of about $25m. “It’s a good cash flow that we’re forecasting from operations and so there is a potential payback of one year,” Mr Jardine said.