A gold loan will be used by International Corona Resources to repay its share of the financing of the David Bell mine in the Hemlo area of northern Ontario.
The company reports a wholly- owned subsidiary, Corona-Hemlo Inc., has entered into an agreement to borrow 106,000 oz gold, worth about $50 million(US), to be used for total repayment of Corona-Hemlo’s 50% portion ($42 million) of the mine’s financing. (Teck Corp. owns the other 50% of the mine.) Balance of the gold loan will be used for general corporate purposes.
The gold loan will be provided by a syndicate of banks with Chase Manhattan Bank of Canada as agent. The loan has a 10-year repayment term with the first principal instalment scheduled for the fourth year when equal quarterly repayment of the principal will commence. The interest rate could currently be set as low as 1.2% per year, the company reports.
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