Tolu Minerals Secures A$30M Debt Facility, Fully Funded to Restart Tolukuma Gold Mine by Q1 2027
Tolu Minerals has locked in a K95 million (approx. A$30 million) debt facility from a Papua New Guinea bank, complementing its A$50 million cash reserves to fully fund the restart of its Tolukuma Gold Mine. Production is targeted for the first quarter of 2027, with an updated Mineral Resource Estimate due imminently.
- K95 million debt facility from National Banking Corporation
- Fully funded to reach production by Q1 2027
- Underground development and plant refurbishment underway
- Updated Mineral Resource Estimate expected within 14 days
- Debt facility carries 9.60% interest over five years
Significant Funding Milestone Achieved
Tolu Minerals (ASX:TOK) has secured a K95 million (approximately A$30 million) debt facility from Papua New Guinea's National Banking Corporation Limited, a move that, combined with its existing cash reserves of about A$50 million, fully finances the restart of the Tolukuma Gold Mine (TGM). This capital injection is earmarked for critical infrastructure including access roads, underground tailings facilities, and power upgrades, setting the stage for production to resume in the first quarter of 2027.
Restart Progress and Operational Plans
Underground development has recommenced on the 1560 Level, with early sampling returning impressive intervals exceeding 30 grams per tonne of gold. Meanwhile, refurbishment of the processing plant is substantially complete, supporting a staged restart that aims to ramp up throughput to roughly 500 tonnes per day by the end of 2027. Camp expansions and hydro plant upgrades are also underway, reflecting a comprehensive approach to reviving the mine’s operational capacity.
Mineral Resource Estimate Update Looms
An updated Mineral Resource Estimate (MRE), prepared by independent consultants H&S Consultants, is expected within the next two weeks. This will be the most thorough review of Tolukuma’s resources to date, incorporating the largest and most intensive drilling program in the mine’s history, including all historical and recent data into a validated geological model. The new MRE will underpin revised mine plans across multiple zones, potentially reshaping the project's economic outlook.
Debt Terms and Future Contracts
The five-year debt facility carries an interest rate of 9.60% per annum and is secured against the company’s assets. Tolu expects to meet customary conditions precedent, including registration of security, ahead of drawdown in September 2026. Announcements regarding contracts for the major infrastructure project and hydro plant upgrades are anticipated in the fourth quarter of 2026, signaling ongoing progress in the mine’s redevelopment.
Transitioning from Explorer to Producer
With funding secured and operational milestones advancing, Tolu is poised to transition from an explorer to a gold producer within months. The company’s ongoing 75,000+ metre drilling campaign continues to deliver assay results that will feed into future resource updates and mine planning. The coming weeks will be critical to confirm the resource base and execute the remaining capital works necessary to restart production.
Bottom Line?
Tolu Minerals has cleared a major funding hurdle, but the imminent Mineral Resource Estimate and execution of infrastructure contracts will be pivotal to validate the restart plan and its production targets.
Questions in the middle?
- Will the updated Mineral Resource Estimate confirm sufficient resources to support the planned ramp-up to 500 tonnes per day?
- How will the 9.60% interest rate on the debt facility impact the company’s financial flexibility during the production ramp-up?
- What timelines and costs will be disclosed in upcoming contract announcements for the major infrastructure and hydro projects?
