Osisko Development has secured a $450m credit facility from strategic partner Appian Capital Advisory to advance its Cariboo gold project in British Columbia, Canada.
In a statement issued on 21 July, Osisko said it has sealed a credit agreement with funds advised by Appian regarding this “senior secured project loan credit facility”.
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The facility, structured in two tranches, will offer “strategic” capital and enhance financial flexibility as the company moves towards fully funding the construction of Cariboo.
The initial $100m draw has been completed and will fund a variety of pre-construction activities.
These include a 13km infill drilling campaign, the repayment of an existing $25m debt with the National Bank of Canada and the fulfilment of general working capital needs at the project.
The subsequent draws, totalling $350m, are available following a final investment decision up to 36 months after the initial draw, contingent on achieving certain project milestones.
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By GlobalDataOsisko chairman and CEO Sean Roosen said: “Having recently completed an updated feasibility study for the project, the $450m facility represents a key financing commitment and allows us to maintain momentum towards a formal investment decision.
“The facility is structured to provide us with financial flexibility as we continue to push forward on pre-construction and construction activities and seek to fully fund the project for construction.”
The facility has a maturity date of 21 July 2033, or eight years from closing. However, if no subsequent draws are made, the maturity will be three years from the closing date of the initial draw.
Additionally, the agreement includes customary representations, warranties, covenants and fees.
For the credit facility, Osisko will issue Appian 5.6 million non-transferable common share purchase warrants, with each warrant allowing the purchase of one common share at C$4.43 ($3.2), valid until 21 July 2028.
The company may repurchase the warrants at their Black–Scholes valuation.
GenCap Mining Advisory, Maxit Capital and Bennett Jones are advising Osisko on this transaction, while Torys is legal counsel to Appian.
Appian founder and CEO Michael W. Scherb said: “The Cariboo gold project perfectly aligns with Appian’s disciplined, technically driven investment strategy. It is situated in a stable jurisdiction, boasts a robust existing minerals base with clear upside potential and is being led by an experienced management team. The project also holds permits that will enable near-term progress to production.”
In December 2024, Osisko received Environmental Management Act permits for its Cariboo project.
