Case study: Mining operations asset finance for expansion

Challenges

Specialised equipment financing challenge

• The mining company, which extracted gold from existing mine dumps and subsequently rehabilitated the environment after extraction, required additional plant assets to expand its operations
• The company had approached various other financial institutions, but faced challenges securing the required finance as a result of its high-risk operations

• Our client required financing of specialised plant equipment and machinery required for expansion of operations
• Due to the complexity of their processes in extracting gold from existing mine dumps and subsequent rehabilitation of the area, the company had been unsuccessful in securing asset financing
• As the extraction process was lengthy, the gold mining business also required working capital to bridge the gap between processing, refining and selling of the gold

Community development objectives

• Additionally, community development was a priority and the client required support with employee upliftment

Solutions

Specialised equipment financing

• Technical and financial experts from our natural resources team visited our client on site to gain an on-the-ground understanding of the complex systems involved in its gold extraction process
• The sustainability of the operation was assessed, including the volume of material that would be processed to ascertain the lifespan of the operation
• Based on this assessment, we were able to advise on the appropriate financing and repayment terms aligned to the lifespan of the project
• We also provided moratoriums based on when the mine could reach profitability

Community development solutions

• We were able to help our client deliver on its employee upliftment objectives by providing employer value banking solutions
• These included financial literacy programmes, assisting employees with pension-backed home loans and vehicle financing