Restart structuring — stalled gold project, West Africa

Context

A mid-tier gold project in West Africa, with a published mineral resource and an advanced feasibility study, had been suspended after a prior financing process did not close. The sponsor — a privately held mining company — retained ISR to evaluate whether the project could be re-financed and on what structure.

The earlier process had failed for a combination of reasons: a capex envelope that lenders found under-contingent, an offtake structure that had not been signed at the time of investment committee, and a model whose grade and recovery assumptions had not been independently verified.

ISR's role

ISR was engaged as the sponsor's lead financial and technical advisor for the restart. The mandate covered:

• Technical re-evaluation of the resource and the metallurgical case, with independent QP review.
• Site visits by ISR principals and the engaged geotechnical specialist; review of mine planning and water-management assumptions.
• A rebuilt financial model anchored to current asset data and current capital and operating cost benchmarks.
• Capital structure design — a senior-debt layer, a development finance institution anchor, and a partial-risk guarantee — calibrated to the revised cashflow envelope.
• Re-engagement of the lender candidates who had previously declined the project, with revised materials prepared to IFC and ECA reporting standards.

Approach

The technical re-evaluation tightened the grade and recovery band, applied a higher contingency to capex in line with current EPC market conditions, and reduced the project's reliance on the previously assumed offtake structure by replacing it with a refinery-level commercial agreement priced against the LBMA reference.

The financial model was rebuilt with senior covenants stress-tested against three commodity-price scenarios and two execution scenarios. The capital stack added a development-finance-institution anchor at the senior level, which unlocked a commercial-bank tranche that would not have underwritten on a standalone basis.

Outcome

The project closed a financing round eleven months after the restart mandate was awarded. The senior-debt covenants were accepted by both the DFI anchor and the commercial-bank tranche. Construction commenced on a revised schedule.

Takeaway

A restart is not a reset. The capital that previously declined a project will only re-engage if the technical case and the structure have been visibly tightened — and if both can be cross-walked back to the original concerns the lenders raised.