By Adria Calatayud

London-listed shares in SolGold PLC rose Monday after the company said it has agreed to a funding package of $100 million with Franco-Nevada Corporation for its Alpala copper-gold project in Ecuador.

The copper and gold mining company said it has also entered into a $15 million bridge loan of immediately available funds with Franco-Nevada as an initial advance prior to closing the financing agreement. The advance provides SolGold with short-term funding at an interest rate of 12% a year for a four-month period, with an option to extend the maturity for another four months, and is repayable with interest upon closing of the larger funding package, it said.

Under the agreement, Franco-Nevada will receive a perpetual 1% net smelter return interest from SolGold, calculated with reference to net smelter returns from the Cascabel license in northern Ecuador where the Alpala project is located, it said. SolGold said it has an option to increase the size of the funding package by $50 million to a 1.5% net smelter return interest within eight months from the date of the agreement.

SolGold shares in London at 0802 GMT were up 9% at 27.95 pence, having earlier peaked at 30.25 pence.

Write to Adria Calatayud at adria.calatayud@dowjones.com

(END) Dow Jones Newswires

May 11, 2020 04:28 ET (08:28 GMT)

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