West Wits Mining Ltd (ASX:WWI, OTCQB:WMWWF) advises that the Industrial Development Corporation of South Africa (IDC) has commenced its due diligence process for the Qala Shallows Project near Johannesburg — essential for finalising funding terms, mobilising resources and initiating operations.
The Qala Shallows project, within the 4.28-million-ounce gold Witwatersrand Basin Project, is supported by a comprehensive definitive feasibility study (DFS).
It is expected to produce nearly 1 million ounces of gold over a 17-year lifespan, with a steady state annual output of more than 70,000 ounces at a cost below $900 per ounce.
Development funding progresses
The IDC has started work to complete its due diligence investigation as part of its proposed ZAR300 million (A$24.2 million) debt facility to fund development capital for Qala Shallows.
West Wits chairman Michael Quinert said, “The commencement of work by the IDC team to complete the due diligence represents a significant milestone towards finalisation of funding for Qala Shallows.
“Not only does it move IDC closer to providing final terms but will also provide comfort and validation for other potential funders who invariably respect and take heed of the IDC’s process.
“I am confident the significant work our team has done to demonstrate the project’s robust economics and technical merit will ensure a successful outcome for this due diligence program.”
Upon the successful completion of due diligence, the IDC will approach its executive credit committee for approval of final terms and conditions. The completion of the due diligence is essential for finalising funding terms, mobilising resources, and initiating operations.
Further funding sources
West Wits notes that the IDC’s decision to initiate work to complete its due diligence investigation was motivated by the progress the company has made in identifying other potential funding sources. This includes the previously announced US$10 million debt facility from Wingfield Partners, LLC, and advanced proposals from other third parties.
Concurrently with the IDC's review, West Wits is advancing discussions with other funding sources, finalising proposed terms with parties at advanced negotiation stages and engaging with various investors following the company’s participation in the recent Mining Indaba Conference in Cape Town, South Africa.