Horizon Minerals has secured debt and equity funding of A$6m ($3.6m) for its Boorara gold project in Kalgoorlie, Western Australia.

The package includes an A$4m ($2.4m) loan facility from a German investment company Sparta and an A$2m ($1.2m) equity placement.

The Boorara gold project involves the development of an open-pit mine and processing facility in the city of Kalgoorlie-Boulder, Western Australia.

The project comprises three deposits: Regal in the north, Royal in the south and Crown Jewel in the centre.

The working capital, combined with the company’s cash reserve of A$2.2m ($1.35m), will allow Horizon to accelerate the development of its Boorora gold project east to start gold production this year.

Commenting on the funding package, Horizon managing director Jon Price said: “A balance of debt and equity in these extremely volatile market conditions minimises dilution to our shareholders while enabling the Company to bring Boorara into production rapidly to capitalise on the high Australian dollar gold price, accelerate a resource growth and exploration drilling program and complete the Feasibility Study in 2020.”

“We welcome Sparta AG as a new international strategic financier and thank all other new and existing domestic and international institutions and sophisticated investors for their support as we move into a very exciting growth phase for the Company in a world-class gold producing region.”

The stage one feasibility study for the project was completed last month. The project is estimated to have a mine life of six months.

The project plan includes the development of three starter pits for open-pit and toll milling.

The Boorara gold mine is currently 100% owned by Horizon Minerals, which was formed by the merger of Intermin Resources and MacPhersons Resources in June 2019.