WEST African Resources said today it had mandated Sprott Resource Lending Corporation and Coris Bank International to arrange loans for its Kiaka gold project in Burkina Faso.

The two institutions will finalise a $265m syndicated loan agreement that will contribute towards funding the $430m project. The balance of the pre-production capital will be sourced from existing cash and internal cash flow from West African’s operating mine Sanbrado, also in Burkina Faso.

Key elements of the mandate are that the loan be absent mandatory hedging. West African Resources forsaw a two tranche structure consisting of $165m and $100m with repayments two years after initial drawdown.

Early repayments must be permitted from three years after closing date. The loans will carry an average interest rate margin of 5.3% a year over the reference rate.

One completed, in the second half of 2025, Kiaka will take West African Resources to total production of 400,000 ounces a year. “Kiaka is one of the best gold projects in development globally. Construction is well-underway, and we look forward to completing the build at Kiaka and pouring first gold,” said Richard Hyde, CEO of West African.

West African said previously Kiaka will average all-in sustaining costs of $953/oz for the first five years and $1,052/oz over the life of mine, generating $2.4bn in pre-tax cash flow.

Kiaka is planned as an open pit mine using a simple process of a single stage crusher and carbon-in-leach extraction technology.

The company bought the project in 2021 from B2Gold, the Toronto-listed gold producer, and its partner, GAMS Mining F&I, a fund.