PERTH (miningweekly.com) – Graphite developer Battery Minerals has secured a $30-million debt and equity package from Resources Capital Funds (RCF) to fund its Montepuez graphite project, in Mozambique.
The debt and equity package marked a significant milestone for the company, as it started the countdown to production and cash flow, MD David Flanagan said on Thursday.
“We are particularly pleased that an investor of the calibre and experience of RCF wished to invest in us and they had confidence in the team, as we strive to be producing graphite concentrate and generating substantial cash flow in less than a year.”
Under the terms of the transaction, Battery Minerals will borrow $25-million from RCF, at an interest rate of 10% a year. The company will pay an establishment fee of 2%, and subject to shareholder approval, will grant some 333-million, five-year options exercisable at 10c each.
RCF will also subscribe for $5-million worth of Battery Minerals fully paid ordinary shares at a price equal to the lowest price at which shares are issued between the execution of the term sheet and the completion of RCF’s equity subscription.
The Montepuez project is expected to start graphite flake concentrate shipments in the March quarter of 2019, at a rate of 45 000 t/y to 50 000 t/y. Battery Minerals has signed four binding offtake agreements for up to 41 000 t/y of graphite concentrate, representing over 80% of the project’s forecast yearly production.