MZI Resources (ASX: MZI) has revealed it is making "significant progress" towards completion of the debt funding arrangements for its Keysbrook mineral sands project in Western Australia.
This ensures MZI remains on track to secure credit approved offers from its two mandated Joint Lead Arranging banks.
The banks have requested additional information on offtake contracts struck for Keysbrook as well as construction arrangements.
With this, MZI said it is confident that it will complete these matters to the satisfaction of the JLAs and receive binding offers of debt finance.
More favourable terms and low OPEX
The slow down in construction activity in WA's resources sector has been a blessing as MZI is likely to achieve more favourable terms for Keysbrook, including the possibility of striking a fixed-price, lump-sum turn-key contract for the development of Keysbrook.
This would provide greater certainty in respect to development costs and schedules and more desirable security arrangements.
Importantly, the current market conditions could also reduce forecast operating costs for Keysbrook, it will conduct a formal tender process for an alternative Keysbrook contract mining strategy.
A Port Services Agreement with the Bunbury Port Authority and other project related commercial contracts are also being finalised.
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