A 7-year silver loan worth US$40-million has been finalized by Consolidated TVX Mining (TSE) with Sharps Pixly & Co., a member of the Kleinwort Benson Group. TVX said it has sold forward seven million ounces of silver which will be delivered over a 5-year period beginning in mid-1992.
The interest rate on the loan has been fixed at 2.875% for the first three years, and the company said it doesn’t expect any significant changes in that rate during the remaining four years of the loan.
The forward sale represents about 20% of TVX’s share of the projected 70 million oz. expected to come from the La Coipa mine over the 7-year loan period. TVX has a 40% stake in the La Coipa mine, a large gold-silver producer situated high in the Andes mountains of northern Chile.
Nearly US$30 million worth of proceeds from the silver loan will be used to repay another loan to Placer Dome (TSE). The latter loan was related to the La Coipa acquisition, TVX said. The remainder of the proceeds will be used for general corporate purposes.
Placer Dome is operator and 50% owner of the La Coipa mine, expected to produce some 2.2 million oz. of gold and 114 million oz. of silver over its 12-year lifespan.
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