US$35 Million Loan Facility Approved for Theta Gold’s TGME Project

Funding Breakthrough for TGME Project

The ASX-listed Theta Gold Mines Limited (ASX – TGM) has announced a significant step forward in financing its flagship TGME Underground Gold Mine Project in South Africa. The company secured a US$35 million (approximately A$53.8 million) loan facility agreement from the Industrial Development Corporation of South Africa (IDC), a state-owned development finance institution. This funding approval follows comprehensive legal, technical, and environmental due diligence, underscoring the project’s viability and the IDC’s confidence in its economic potential.

The loan facility carries a seven-year term from the first drawdown, including an initial 18-month moratorium on both capital and interest repayments. This structure provides Theta Gold with breathing room to advance construction and development without immediate debt servicing pressures, a crucial advantage for a project at this stage.

Strategic Mining Rights Renewal

Alongside the loan announcement, Theta Gold confirmed the renewal of its mining rights (MR83) for the Beta, CDM, and Frankfort mines through to 2038. These mines represent over 75% of the current mine schedule, and securing this renewal removes a major hurdle for project financing. The company’s subsidiary has held this ground for more than 130 years, highlighting a deep-rooted presence in South Africa’s Eastern Transvaal goldfields.

Looking Ahead – Updated Feasibility and Additional Funding

The company is currently updating its Definitive Feasibility Study (DFS), originally released in July 2022, with results expected in the third quarter of 2025. Given the current gold price hovering around US$3,324 per ounce, significantly higher than the previous DFS assumption of US$1,642 per ounce, the updated study is anticipated to show markedly improved project economics. This could enhance the project’s valuation and attractiveness to further investors.

Theta Gold is also in ongoing discussions with other potential lenders to complete the overall project debt funding package. Finalisation of the IDC loan facility remains subject to standard conditions, including satisfactory security sharing terms with co-lenders, completion of Theta Gold’s equity funding contribution, and final legal documentation.

Implications for Theta Gold and Investors

Chairman Bill Guy emphasized the IDC’s role as a strong partner with a proven track record of backing early-stage African mining successes. The IDC’s involvement not only provides capital but also signals confidence in the TGME project’s sustainable growth potential. For investors, this milestone reduces financing risk and sets the stage for the company to progress toward production, targeting an output of 160,000 ounces per annum over the next five years.

While the loan agreement and mining rights renewal clear significant obstacles, the project’s ultimate success will hinge on the updated DFS outcomes and securing the remaining financing. The next few months will be critical as Theta Gold navigates these final steps toward unlocking value from its extensive South African gold assets.