Adriatic Metals PLC (LSE:ADT1, ASX:ADT, OTCQX:ADMLF) chief executive Paul Cronin has hailed “another critical step” forward in de-risking the Vares silver project, as the company announced the first drawdown of project financing.
The company, in a statement, told investors it had received the first tranche of US$30mln from its US$142.5mln debt financing package with Orion Resource Partners, with the remaining funds expected to be drawn in January 2023.
The injection of funds will support the construction of Vares, in Bosnia & Herzegovina, where the mine is already more than 50% complete.
Vares, now fully funded, is slated to see first concentrate production in the third quarter of Q3 2023.
"I am delighted that Adriatic has completed all conditions precedent to draw down the first tranche of the Orion Debt Package. The funds will be used to continue the construction of the world-class Vares Silver Project, which is already over 50% complete,” Paul Cronin said.
"This is another critical step towards de-risking the project, and we remain on track to deliver first concentrates in Q3 2023.
"In the Orion team we have a professional finance partner that has a detailed understanding of the Vares silver project.”
Adriatic secured an institutional equity raise of US$102mln, in October 2022, as part of the package bringing the total Vares project financing to US$244.5m. Orion subscribed for US$50m of the shares issued in the institutional equity raise, giving the financing partner an 8.9% shareholding in Adriatic.
The debt financing package includes a donation of $100,000 from Orion to the Adriatic Foundation, which will be used to support community and environmental initiatives in Vares & Kakanj.
“Orion are aligned with our commitment to responsible mining and sustainability, via a $100,000 donation to the Adriatic Foundation, which will support valued community and environmental initiatives in Vares & Kakanj,"Cronin added.