Golden Star Resources amended and upsized its existing senior secured credit facility with Macquarie Bank Limited to $70 million.

The credit facility is upsized from $50 million to $70 million, allowing the company to redraw the two $5 million repayments that were made in June and September 2020 as well as an additional $10 million of new capacity, which will be made available in conjunction with the redemption of the convertible debentures maturing in August 2021.

As a condition of amending the facility, Golden Star extended its gold price protection hedging program into 2021 and 2022 by entering into zero cost collars with Macquarie Bank Limited on a total of an additional 87,500 ounces with a floor price of $1,600 per ounce and a ceiling of $2,176 per ounce in 2021 and $2,188 per ounce in 2022. These additional positions will mature at a rate of 10,937.5 ounces per quarter from January 2021 to December 2022.

The interest charge remains unchanged at LIBOR plus 4.5%.

“The amendments to the credit facility and the recently announced completion of the sale of the Bogoso-Prestea operation combine to further strengthen our balance sheet. The restructuring of the credit facility creates $35 million of incremental liquidity which, combined with the $15 million of proceeds from the sale of the Bogoso-Prestea operations due to be received by July 2021, results in $50 million of additional liquidity. Should it be required, this provides us with the solution to satisfy the repayment of the convertible debentures on maturity in August next year. In turn, our current cash position and ongoing cash flow generation from Wassa enable us to focus on stepping up our investment in drilling and development at Wassa together with a broader exploration program on a number of targets on the highly prospective Ashanti belt. The extension of the gold price protection program to the end of 2022 secures an attractive floor and ceiling price for the period, further de-risking the company’s ability to deliver on its financial obligations while also looking to explore the options to capitalize on the large resource and latent mill capacity at Wassa.” Andrew Wray, president and CEO of Golden Star, said.