PERTH (miningweekly.com) – Coal developer Paringa Resources has completed a bookbuild to raise A$53-million to complete the financing of its Poplar Grove mine, in Western Kentucky’s Illinois basin.
The company on Tuesday told shareholders that it had received commitments for the placement of 102-million shares, at an issue price of 52c each, to institutional and sophisticated investors.
The placement will be completed in two tranches, with the first 44.6-million shares to be issued under the company’s placement capacity. The issue of the remaining 57.3-million shares will be subject to shareholder approval.
The share placement is in addition to the recent five-year $20-million debt facility secured from Macquarie Bank to assist in funding the Poplar Grove mine.
“This successful capital raising completes the funding required for the development of the Poplar Grove coal mine, starting in July 2017. We now have a strong financial position to deliver on our plan to become a 6.6-million-tonne-a-year Illinois basin producer, starting with construction of the low cost and high margin Poplar Grove mine, and then followed by the fully permitted, high margin Cypress mine,” said Paringa MD and CEO Todd Hannigan.
A recently expanded bankable feasibility study into the Poplar Grove mine estimated that for a capital investment of $44.7-million, the Poplar Grove mine could be developed into a 2.8-million-tonne-a-year operation, with all-in operating capital estimated at $29.24/t.
The project is expected to have a mine life of 25 years and will deliver average yearly earnings before interest, taxes, deprecation and amortisation of $67-million.