FG Gold Secures $330M for Sierra Leone Gold Mine in Largest Project Finance Deal
FG Gold has closed a $330 million project finance package to develop the Baomahun Gold Project in Sierra Leone, marking the largest mining transaction in the country’s history, according to African Business.
Breaking Down the $330M Financing Structure
The deal was led by African Finance Corporation (AFC), which provided $175 million, and African Export–Import Bank (Afreximbank) with a $75 million contribution. Singapore-based Trafigura added $105 million through an offtake financing arrangement. Other key elements included $60 million in hybrid power investment from CrossBoundary Energy and $20 million from Fundo Soberano de Angola, making it the Sovereign Wealth Fund’s first foray into Sierra Leone.
FG Gold CEO Oliver Andrews, who spearheaded the project, highlighted the innovative financial structure as critical to overcoming the challenges inherent in financing mining projects in developing markets. The project taps into Sierra Leone’s rich gold resources, aligning with the country’s mineral development goals.
Why This Matters to Industry and Investors
This transaction sets a benchmark for mining finance in Africa and signals confidence in Sierra Leone’s regulatory and operational framework. Industry analysts point out that the hybrid financing model addresses key risks – political, market, and operational – making it an example for frontier markets seeking to secure sustainable resource financing.
Moreover, the Baomahun Gold Project could significantly contribute to Sierra Leone’s GDP, potentially adding 10% to its economic output. The project is also expected to create hundreds of jobs and improved community infrastructure, including schools and clinics, as part of FG Gold’s commitment to sustainability and local engagement.
Future Outlook: A New Model for African Mining Financing?
With first gold expected to be mined this year, market watchers see this as a blueprint for responsibly harnessing African mineral resources. The innovative use of hybrid project finance could signal a shift toward greater local ownership and long-term value generation from Africa’s natural resources.
Will other frontier economies and mining projects replicate this model? That could determine if this deal is truly transformative for the industry.
