Rio2 has announced a funding package totalling around $150m to fund the mine construction and operational development of its fully owned Fenix gold project in Chile.
The funding enables the mining company, which now holds all the necessary sectorial permits to proceed with the project’s construction. Rio2 will also fully execute the development, ramp-up and operation of the Chilean gold mine.
Rio2’s financing package includes a $120m agreement with Wheaton Precious Metals International and a public offering of common shares aimed at raising up to C$40m ($29m).
The Wheaton package involves a $100m prepay arrangement, divided into two $50m tranches, and a $20m standby loan facility designed to cover potential cost overruns. Additionally, Wheaton will participate in a private placement worth C$5m ($3.6m).
The first $50m tranche is expected in early 2025, with the second tranche scheduled for Q3 2025.
In addition, Rio2 and Wheaton have amended their existing precious metals purchase agreement.
Under the terms of the agreement, Rio2 will deliver 95,000 ounces of gold to Wheaton, representing less than 8% of the mine’s projected gold production.
Rio2 plans to use the proceeds from the public offering and private placement to fund the construction, development, operation, commissioning and ramp-up, and general working capital for the Fenix gold project.
Located in the Atacama region, in the Copiapo province, the Fenix gold project is said to be the largest undeveloped gold heap leach project in the Americas.
Rio2 executive chairman Alex Black said: “This financing package is the result of a competitive and comprehensive process undertaken by the Company, with the assistance of Endeavour Financial as its advisor, to secure the optimal financing solution for the construction of our Fenix Gold mine.
“Wheaton’s expanding commitment to us validates the quality of our Fenix project, and their continued backing as a cornerstone financial partner, in addition to the support of our shareholders, has put Rio2 in a position of certainty to fund Fenix to production.”
