Cerrado Gold Reports Oversubscribed Project Financing Tender

Press Release Highlights

  • Financing tender completed quickly and was oversubscribed
  • Debt package expected to cover 70% of total project capital expenditures, limiting equity needs.
  • Closing expected in 2Q 2024 after due diligence, allowing project to remain on schedule with first production expected in 2025 from Brazilian project.

Cerrado Gold Inc. (TSX.V:CERT)(OTCQX:CRDOF) is pleased to announce that it has completed the tender process for its Export Credit Agency (“ECA”) Supported Non-Recourse Project Financing, and expects to complete the on-boarding and appointment process within the next few weeks. The Company has chosen two international banks to act as MLAs; one for the Monte Do Carmo Project (“MDC”) and another as MLA for its Mont Sorcier Project (“MS”) in Quebec.

As announced on September 5th, the Company together with its advisors, SD Capital Advisory Ltd and GKB Ventures Ltd (“S&G”), initiated a tender process to solicit interest from a number of global Project Finance Banks to act as MLA for the Company’s ECA Supported Non-Recourse Project Financing, supported by the UK Export Finance agency (“UKEF”). As a result of this process the company received several compelling bids and have evaluated the bids based on experience, execution capabilities and financial terms. The institutions selected have extensive experience in ECA financing, a longstanding relationship with UKEF and presented competitive terms for the financing. The Company is currently undertaking a review of formal engagement letters with each Bank and will announce the banks and their terms once signed.

As outlined previously, UKEF has expressed an interest to provide support for up to US$190 million for the MDC Project and up to US$420 million for the MS Project, representing 70% of total capital expenditure, interest payable during construction, political risk insurance premium as well as other approved expenditures for each project.

The appointment of the MLAs is a significant milestone for the project financing requirements for both the MDC and MS Projects. The next phase of the process will comprise a formal due diligence period before final binding offers and documentation which are expected to be completed in 2Q 2024. This process is expected to start immediately in the case of MDC but will not be initiated at MS for a period of 6 months, to align more closely with the completion of the planned feasibility study.

After a robust tender process, we are very pleased to have been in a position to generate the support of two very strong Project Financing Institutions to lead our Project Financings. We view the early commitment of the ECA’s and the MLAs as a testament to the robust financial strength of the MDC and MS projects. With the completion of the MDC Feasibility Study imminent, we are excited to bring the first of these two great projects towards a fully funded project development decision during Q2/2024.Mark Brennan, CEO and Chairman

About Cerrado

Cerrado Gold is a Toronto-based gold production, development, and exploration company focused on gold projects in South America. The Company is the 100% owner of both the producing Minera Don Nicolás and Las Calandrias mine in Santa Cruz province, Argentina, and the highly prospective Monte Do Carmo development project, located in Tocantins State, Brazil. In Canada, Cerrado Gold is developing it’s 100% owned Mont Sorcier Iron Ore and Vanadium project located outside of Chibougamou, Quebec.

In Argentina, Cerrado is maximizing asset value at its Minera Don Nicolas operation through continued operational optimization and is growing production through its operations at the Las Calandrias Heap Leach project. An extensive campaign of exploration is ongoing to further unlock potential resources in our highly prospective land package in the heart of the Deseado Masiff.

In Brazil, Cerrado is rapidly advancing the Serra Alta deposit at its Monte Do Carmo Project, through feasibility and into production. Serra Alta is expected to be a high-margin and high-return project with significant exploration potential on an extensive and highly prospective 82,542 hectare land package.

In Canada, Cerrado holds a 100% interest in the Mont Sorcier Iron Ore and Vanadium Project, which has the potential to produce a premium iron ore concentrate over a long mine life at low operating costs and low capital intensity. Furthermore, its high grade and high purity product facilitates the migration of steel producers from blast furnaces to electric arc furnaces contributing to the decarbonisation of the industry and the achievement of SDG goals.

For more information about Cerrado please visit our website at: www.cerradogold.com.

The opinions provided in this article are those of the author and do not constitute investment advice. Readers should assume that the author and/or employees of Capital 10X hold positions in the company or companies mentioned in the article. For more information, please see our Content Disclaimer.

Duane Hope is a Partner at Capital 10X, he brings over 15 years of communications and research experience to the firm. His research and writing have appeared in publications for North American, European and Asian audiences.

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