GOLD: Lake Shore repays $20M loan early

TORONTO – Lake Shore Gold will repay the $20-million balance on its standby line of credit on Dec. 31, 2014. The payment will include the balance plus $1.4 million in fees. The company says the early repayment will save it $2.4 million in interest over the remaining term of the loan. The original repayment date, as per the agreement with Sprott Resource Lending Partnership, was to be November 2016.

Once this debt is repaid, Lake Shore said it will have about $7 million of debt remaining with Sprott, all related to a gold linked note. The final payment on the note will be made in May 2015.

Earlier this year Lake Shore president and CEO Tony Makuch pledged to pay down $20 million to $25 million of debt, but with the most recent announcement that amount will be $45 million repaid in 2014. The company's cash and bullion holdings will stand at $60 million by year-end, up from $34 million at the beginning of 2014.

"Our increased financial strength is largely the result of a solid operating performance during the year, with the Company on track for record production of at least 180,000 oz of gold and both cash operating costs and all-in sustaining costs beating our full year 2014 targets," Makuch said in a news release.

Visit LSGold.com for details about the company's gold mines in northern Ontario.