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Macquarie joins Cape Hardy port plans

24th September 2020

By: Esmarie Iannucci

Creamer Media Senior Deputy Editor: Australasia

     

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PERTH (miningweekly.com) – ASX-listed Iron Road on Thursday announced that Macquarie Capital had entered into a joint development agreement to advance the development and financing plans for the proposed A$250-million Cape Hardy Stage 1 multi-user, multi-commodity port facility.

Iron Road, Macquarie and the Eyre Peninsula Co-operative Bulk Handling (EPCBH) will now work to establish a project vehicle and to formally start the first phase of a development plan, targeting financial close of the project by the third quarter of 2021.

The joint development agreement defines steps for securing equity and debt capital for the port development, and includes the usual rights of termination, Iron Road told shareholders.

“Iron Road has been working closely with key stakeholders on the Cape Hardy port development since 2012 as part of the wider Central Eyre iron project. We are pleased that Macquarie Capital share our vision of the near-term benefits and future opportunities this vital infrastructure unlocks for the Eyre Peninsula communities,” said Iron Road CEO Larry Ingle.

‘A major partnership milestone with Macquarie Capital and EPCBH represents a key step forward in de-risking his important project for South Australia.”

The planned export facility at Cape Hardy is designed to be South Australia’s first Capesize capable port, and will be developed over a number of stages. The Stage 1 port will be predominantly used for grain export, with third party access for the import and export of various other commodities.


The port is planned to have an initial shiploader capacity of 70-million tonnes a year.

It is hoped that the port would ultimately integrate to the Australian National Rail Network, providing the basis for a multi-user bulk shipment port which could service central and southern regional Australia.

In addition to the joint development agreement, Iron Road and Macquarie have also entered into a second agreement, which will see 40-million Iron Road warrants being issued, with vesting contingent on financial close and commercial operations being achieved.

An initial 25-million tranche is exercisable from financial close, with the second 15-million tranche exercisable from the commercial operations date. The warrants will have an exercise price of 7.5c, which is equivalent to Iron Road’s last issue offer price, and will expire 24 months after the commercial operations date.

Iron Road has also granted Macquarie the right to participate in up to 20% of any share placement conducted by the company for a period of up to 12 months, starting in the lead up to financial close.

Edited by Creamer Media Reporter

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