Vancouver, BC – TheNewswire - January 6, 2025 – Sponsored content disseminated on behalf of West Red Lake Gold. On January 2, 2025, West Red Lake Gold Mines (TSXV: WRLG) (OTCQB: WRLGF) announced that it has closed a USD $35 million loan agreement ($55 million Canadian dollars) with Nebari Natural Resources Credit Fund II LP (Nebari).

“Closing this transaction with Nebari is a major de-risking step and gives West Red Lake access to up to USD$35M of non-dilutive capital, at highly favorable repayment terms which offers us solid operational flexibility going forward and allows the Company to sustain the momentum as we push to restart the Madsen project,” stated WRLG President and CEO Shane Williams.

The January 2 press release included arcane financial terms like “fixed straight-line amortization” “loan bonus warrants” and “perfected first priority senior security interest”.

In the January 3, 2024 “explainer” video below, Gwen Preston, VP of Communications at WRLG, cut through the technical jargon to reveal the PR’s major plot points.

“Today West Red Lake Gold announced the close of the US$35-million credit facility with Nebari Natural Resources,” stated Preston. “We announced this as a term sheet in October and after several months of technical and legal review the company and Nebari now have a completed loan agreement in place – and the first US$15 million of that loan is in West Red Lake’s hands.”

“It takes immense due diligence to complete a deal like this. Nebari had to understand our data and plans at Madsen almost as well as we do.

Here are the three key takeaways from the January 2, 2025 PR.

First: the Madsen project held up against all that questioning, which is an endorsement: Nebari agrees with us that this mine makes sense in this gold environment.

Second: The Nebari capital has West Red Lake Gold well funded to put the Madsen mine back into production. We are already mining, on a small scale to build up some bulk samples and to get our crews operating accurately, efficiently, and safely.

Third: this is a good debt deal. The cost of capital is reasonable and the terms are designed to support success, such as no capital repayment for 15 months and half of capital not repaid until a bullet payment at maturity.”

“We are very excited to have accomplished this key restart requirement,” concluded Preston in the explainer video. “For those waiting for the Pre-Feasibility Study: it is coming soon”.

Given the complexity of the Nebari deal, some investors might wonder why WRLG didn’t just book an appointment with the Small Cap Metals Division at the local bank.  There’s a simple reason: that division does not exist.

Major banks do not have the expertise to assess the geological, metallurgical and political risks of explorers or developers.   “If we make a bad loan to a one mine company, we own the mine,” said David Scott, of CIBC Capital Markets in a Financial Post interview, “and we don’t want to own mines.”

The reticence of big banks to participate in the junior mining sector has created a business opportunity for commercial lenders who do understand the mining sector.

The Nebari Team has owned and operated mining assets around the world. Its deep mining expertise makes Nebari a preferred financing partner for companies like West Red Lake Gold. Based in New York, Nabari’s team of partners and consultants work globally in Anchorage, Denver, Toronto, London, Madrid, Zug and Perth.

“Nebari is excited to partner with West Red Lake Gold to support the restart of the Madsen project,” stated Richard Gaze, Managing Director of Nebari. “We have high confidence in the dedication and professionalism of the West Red Lake Gold team and look forward to the successful restart of commercial gold production at Madsen.”

The funds will be used to complete the remaining capital projects to restart the Madsen Mine, and pay for other corporate, exploration and working capital expenses.

Previous financing announcements:

In April 2024 WRLG closed a CND$37 million placement of gold linked notes. The notes represent unsecured obligations of WRLG, bearing a 12% per annum coupon, and will mature on December 31, 2029.

In May 2024, WRLG raised CND$33 million by issuing ≈31.9 million units and 11.2 million charity-flow through units priced at C$0.72 per Unit.

In October 2024 WRLG raised CND$28.7 million by issuing ≈41.6 million shares at C$0.69 per share.

“After gaining nearly 30% in 2024 – outperforming every commodity and all but a handful of assets – gold prices are still inspiring confidence among many industry experts, while most retail traders see the yellow metal breaking above $3,000 per ounce in 2025,” reports Kitco.com.

“We believe gold’s positive momentum will continue in the short to medium term,” wrote ING commodities strategist Ewa Manthey. “The macro backdrop will likely remain favourable for the precious metal as interest rates decline and foreign-reserve diversification continues amid geopolitical tensions, creating a perfect storm for gold.”

The Madsen Mine deposit presently hosts an NI 43-101 Indicated resource of 1.65 million ounces of gold grading 7.4 g/t gold and an Inferred resource of 0.37 Moz of gold grading 6.3 g/t gold. [1.] [2.] [3.]

The technical information presented in this news release has been reviewed and approved by Will Robinson, P.Geo., Vice President of Exploration for West Red Lake Gold and the Qualified Person for exploration at the West Red Lake Project, as defined by NI 43-101 “Standards of Disclosure for Mineral Projects”.

Contact: guy.bennett@globalstocksnews.com

Disclaimer: West Red Lake Gold paid Global Stocks News (GSN) $1,500 for the research, writing and dissemination of this content.

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References:

1. SRK Consulting. (2021). Independent NI 43-101 Technical Report and Updated Mineral Resource Estimate for the PureGold Mine, Canada (West Red Lake Gold Mines, Ed.) [Review of Independent NI 43-101 Technical Report and Updated Mineral Resource Estimate for the PureGold Mine, Canada. 

2. Mineral resources are estimated at a cut-off grade of 3.38 g/t Au and a gold price of US1,800/oz. Please refer to the technical report entitled “Independent NI 43-101 Technical Report and Updated Mineral Resource Estimate for the PureGold Mine, Canada”, prepared by SRK Consulting (Canada) Inc., and dated June 16, 2023, and amended April 24, 2024. A full copy of the SRK report is available on the Company’s website and on SEDAR+ at www.sedarplus.ca 

3. Mineral resources that are not mineral reserves do not have demonstrated economic viability. Please refer to the technical report entitled “Independent NI 43-101 Technical Report and Updated Mineral Resource Estimate for the PureGold Mine, Canada”, prepared by SRK Consulting (Canada) Inc., and dated June 16, 2023, and amended April 24, 2024. The Madsen Resource Estimate has an effective date of December 31, 2021 and excludes depletion of mining activity during the period from January 1, 2022 to the mine closure on October 24, 2022 as it has been deemed immaterial and not relevant for the updated report. A full copy of the SRK report is available on the Company’s website and on SEDAR+ at www.sedarplus.ca 

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