By Foday Moriba Conteh
In a significant development for the mining sector in Sierra Leone, FG Gold Limited announced the signing of a Mezzanine Finance Facility worth US$55 million with the Africa Finance Corporation (AFC) and Engineering Procurement Construction Management (EPCM) Agreements with Lycopodium Minerals Canada Limited on Wednesday, December 20, 2023. The ceremony was held at the River Annex Hall at Radisson Blu Hotel in Freetown.
This strategic move aims to facilitate both the structural machinery and financial requirements for the operationalization of the Baomahun Gold site in Bo and Tonkolili Districts concurrently. The mezzanine financing from AFC builds on the existing US$45 million stream investment, resulting in a total quasi equity of US$100 million dedicated to the project.
The injection of funds allows FG Gold to accelerate construction activities and fulfill orders for essential equipment packages. Most notably, this financial boost ensures that FG Gold adheres to its schedule, with the goal of achieving the first gold pour by December 2025.
Lycopodium Minerals Canada Limited (“LMCL”) emerged as the preferred bidder during the competitive tender process initiated by FG Gold in August 2022. The process invited six potential bidders to submit quotations for the EPCM of the Baomahun Gold Project.
FG Gold, with a primary focus on the development of its flagship gold project, the Baomahun Gold mine in Sierra Leone, positions itself as one of the largest pre-production gold assets in Africa. The project, already underway with early infrastructure construction, is expected to witness its first gold pour in 2025.
Situated approximately 200km east of the capital Freetown, in the Valunia and Kunike Barina Chiefdoms of Bo and Tonkolili Districts, the Baomahun Gold Project holds full licenses and permits, emphasizing its commitment to responsible and regulated mining practices.
Executive Chairman of FG Gold, Oliver Tunde Andrews, expressed the company’s needs from partners, emphasizing the importance of timely mining plant construction, detailed design of the power plant, and ensuring quality and cost-effectiveness of equipment.
He affirmed the company’s commitment to compliance with Sierra Leone’s mining policies, international standards, and collaboration with local contractors for mining site facilitation.
Minister of Mines and Mineral Resources, Julius Mattai, underscored the importance of equipping young people with the necessary skills for competitiveness in the mining job market. He commended FG Gold for transparency, expressing confidence in their long-term commitment to Sierra Leone.
President of Lycopodium Minerals Canada Limited, Sohail Samdani, outlined their role in providing engineering procurement services, project management, material equipment supply, and technical support to FG Gold Limited.
Hon. Sao Lamina, Chairman of the Mines and Mineral Committee in Parliament, emphasized the expectation for FG Gold to comply with local mining policies and the provisions of the Local Content Act, underscoring the importance of responsible and beneficial mining practices for national development.
