Guerrero Olivos counsels Rio2 on financing for Fenix Gold
Guerrero Olivos has counselled Rio2 Limited on the ‘Wheaton Financing’, comprising the arrangement of a financing package totalling approximately USD $150 million for the construction and general working capital of the company’s 100% owned Fenix Gold project in Chile.
The financing consisted of (i) a USD100 million flexible prepayment agreement (the ‘Flexible Prepayment Agreement’), (ii) a USD20 million contingent cost overrun facility in the form of a standby credit facility (the ‘Standby Credit Facility’) and (iii) Wheaton’s private placement of CAD5 million.
The transaction, completed on 21 October, involved the jurisdictions of Chile and Canada, DLA Piper (Canada) advised Rio2 on the public offering and private placement of Wheaton, while McMillan acted as Canadian counsel to Rio2 in respect of the Wheaton Financing.
This financing package marks a significant milestone in de-risking for Fenix Gold, and with all key sectoral permits for construction now in hand, Rio2 is in a position to fully execute the development, commissioning and operation of the Fenix Gold mine.
Concurrently with the Wheaton Financing, Rio2 and Wheaton have also agreed to an amendment (‘Gold Stream’) to the existing precious metals offtake agreement which was entered into on 15 November 2021.
This funding is vital to continue the execution of the Fenix Project and secure funding for the construction phase.
Guerrero Olivos’ team was led by partner Benjamín Pérez (pictured), with support from partner Pedro Lyon, and associates Antonia Melelli and Javiera Cid.
