JOHANNESBURG (miningweekly.com) - JSE-listed Metorex has reduced the Ruashi project debt by a further $16-million to $84,9-million, the company reported on Tuesday.

Metorex CEO Terence Goodlace said the voluntary prepayment was done to ringfence the Ruashi debt and to derisk the Metorex company balance sheet.

The payment was funded from the recently completed capital raising through a claw back offer in which the company gained R586-million in March, which triggered a new Ruashi debt agreement.

Under the agreement, repayments of debt were reduced from $22-million to $16-million every six months and the company had a debt holiday until January 1, 2011. The Ruashi debt would become a non-recourse to Metorex when the outstanding balance was reduced to below $85-million.

Thus, following this prepayment, the non-recourse conditions had been met and the Ruashi debt was now entirely ringfenced to the Ruashi legal entity.

Metorex had reduced the Ruashi debt by $101-million, or 55%, since December.

Goodlace said that the non-recourse event provided Metorex with financial flexibility and optionality in terms of its growth projects' funding strategy.

"Currently, our potential development projects include Kinsenda, Lubembe and Musonoi in the Democratic Republic of the Congo," he concluded.