Finnish ECA backs big mine equipment purchase

Canada’s Troilus Mining Corp has secured up to US$132 million of Finnish export credit agency backing for a large equipment supply contract at its proposed circa-$1.4 billion Troilus gold-copper project in Quebec.

The C$1.3 billion TSX-listed company said this week it was buying US$155 million of mill equipment and services from Finnish manufacturer Metso for Troilus. Finnvera, Finland’s official ECA, could guarantee up to 85% of the value of the Metso deal under a letter of interest Troilus said it received from the agency.

Troilus, in Quebec’s Eeyou Istchee James Bay region, is planned to produce an average 244,600 ounces of gold and 17.3 million pounds of copper a year for more than 20 years from the end of this decade.

Troilus MC says it is advancing a senior secured project financing mandate of up to US$1.2 billion with lead arrangers Societe Generale, KfW IPEX-Bank and Export Development Canada alongside support from Canadian and European ECAs.

“The Finnvera LOI adds a positive dimension to the Metso procurement and represents an important advancement in our broader project financing strategy,” Troilus CEO Justin Reid said.

“The potential for up to approximately $132 million in export credit support provides another attractive financing avenue as we continue advancing Troilus toward construction.

“Finnvera is already participating in our broader project financing process and we are very pleased to see the potential scope of that relationship expand alongside our advancing procurement program.”

Toronto investment firm Red Cloud Securities said securing long lead-time capital equipment was essential to allow detailed engineering to advance and preserve Troilus’ overall development schedule.

“While non-binding and subject to due diligence the LOI represents a key step in assembling the circa-US$1.4B construction package we model,” the firm said.