Photo by: Bloomberg
PERTH (miningweekly.com) – Iron-ore miner Atlas Iron has repaid A$54-million in debt, following a strong December quarter, reducing its US term loan debt to A$118-million.
The miner said last week that it had completed the December quarter with some A$134-million cash on hand, as a result of the cash flow generated during the three-month period. This was up from the A$95-million cash on hand at the end of September 2016.
The miner noted that the significant increase in cash came after making principal and interest repayments of some A$20-million during the December quarter, and a A$3-million repayment to the Western Australian government in relation to the royalty relief programme.
Under cash sweeping arrangements with lenders, any cash on hand at the end of each quarter in excess of A$80-million will be paid to the lenders. As a result, Atlas has now repaid A$54-million in debt.
“Atlas is now on track to be in a net cash position by the middle of this year,” said interim MD Daniel Harris.
“This markedly stronger balance sheet will help make Atlas more resilient and better placed to capitalise on its opportunities, including the development of the Corunna Downs project.”
A December definitive feasibility study found that the project, in the Pilbara, could deliver some four-million tonnes a year of lump and fines direct shipping ore over an initial mine life of five to six years.
The project is expected to require a capital investment of between A$47-million and A$53-million, and the Atlas board is expected to take a development decision in March this year.