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Aya Gold & Silver, the Canada-based silver mining company has closed a $100 million funding deal to support the expansion of Morocco’s Zgounder Silver Mine project.
Aya Gold & Silver, the Canada-based silver mining company has closed a $100 million funding deal to support the expansion of Morocco’s Zgounder Silver Mine project. Six precious metal mining zones in Morocco, including the Zgounder mining zone, are operated by Aya Gold and Silver. Commercial production from the mine started in January 2019.
Zgounder is the second most important silver mine in the country and a joint venture between Aya Gold and Silver’s subsidiary Zgounder Millennium Silver Mining. Zgounder Millennium Silver Mining owns 85% and The Office National des Hydrocarbures et des Mines (ONHYM) of the Kingdom of Morocco owns 15%. An agreement was signed in September 2022, to acquire ONHYM’s 15% interest in the Zgounder project and five adjacent permits to the silver mine by Aya which will raise its ownership to 100% once the procedure is completed.
The project financing offers financial flexibility to Aya to undertake Zgounder Silver Mine expansion. The financing deal was reported in October 2022. The deal includes a $92 million loan from the European Bank for Reconstruction and Development (EBRD) and an $8 million tranche from the Clean Technology Fund. It has a six-year maturity with a two-year principal grace period and a 24-month availability period. It also has no strings attached like mandatory silver hedging, offtakes, production-linked payments, or equity issuances as part of the structure.
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On 25 October 2022, Zgounder Millenium Silver Mining secured a $100mn debt financing package for the expansion project. This includes a Senior Debt Facility of $92m from EBRD, while the Climate Investment Funds via its Clean Technology Fund (CTF) will provide $8m.
