Proactive Investor's  Instablog

Proactive Investor
Send Message
Proactiveinvestors is a leading multimedia news organization, investor portal and events management business with offices in New York, Sydney, Toronto and London. Proactiveinvestors operates five financial websites in four languages providing breaking news, comment and analysis on hundreds of... More
My company:
My blog:
  • Resource Generation Provides Update On Boikarabelo Mine Financing 0 comments
    Mar 18, 2013 7:15 PM

    Resource Generation (ASX:RES) has revealed it is considering alternative sources of funding to construct its Boikarabelo mine on one of South Africa's largest remaining coal deposits.

    This was after receiving credit-approved offers of project finance that deviate from the agreed terms sheet the company said today.

    The credit approvals received from Resource Generation's mandated debt financiers included commercial conditions which were unacceptable to the company.

    Negotiations on these conditions are continuing; meanwhile, parallel discussions are at an advanced stage with existing and potential customers which have expressed interest in providing equity funding to enable major construction to begin.

    Paul Jury, managing director of Resource Generation, said: "Without contingencies and costs associated with debt funding, capital expenditure is estimated at $530 million, which includes $100 million for mobile equipment.

    If we secure finance from alternative sources to part-fund this expenditure, the company will have flexibility to raise the remaining capital required to complete construction of the mine by way of equity or debt at a later time.

    The due diligence conducted by independent experts on behalf of the financiers identified no material issues and I believe the credit-approved offers of finance confirm Boikarabelo's viability and potential.

    All regulatory approvals have been received, the land for the mine and rail link has been acquired, and we have contracts providing rail haulage and port access.

    In addition, we have three significant export contracts for thermal coal with major Indian customers and the global trader Noble Group."

    Significantly, with construction of site infrastructure, roadworks, and water and power connections beginning, and the site is now classified as an operating mine site.

    The Boikarabelo mine in the Waterberg region of South Africa has probable reserves of 744.8 million tonnes of coal on 35% of the company's tenements.

    Proactive Investors Australia is the market leader in producing news, articles and research reports on ASX "Small and Mid-cap" stocks with distribution in Australia, UK, North America and Hong Kong / China.

Back To Proactive Investor's Instablog HomePage »

Instablogs are blogs which are instantly set up and networked within the Seeking Alpha community. Instablog posts are not selected, edited or screened by Seeking Alpha editors, in contrast to contributors' articles.

Comments (0)
Track new comments
Be the first to comment
Full index of posts »
Latest Followers


More »

Latest Comments

Instablogs are Seeking Alpha's free blogging platform customized for finance, with instant set up and exposure to millions of readers interested in the financial markets. Publish your own instablog in minutes.