Northland Resources secures short-term funding to maintain operations
TORONTO (miningweekly.com) – Junior iron-ore producer Northland Resources on Friday said it had received approval from its bondholders and major suppliers for additional short-term funding to maintain the company’s current operations.
The company in February filed for creditor protection, the same month it shipped the first iron-ore from its Kaunisvaara mine, in Sweden.
The company said it had secured short-term financing totalling $20-million, of which $10-million would come from the debt service account of the bond trustee, and $10-million would be provided as a bridge facility by its significant suppliers.
The short-term financing would be disbursed at defined milestones during the period up until mid-April.
Northland said it expected the funding would allow it to continue its operations at the present level to continue its work on the logistics chain as scheduled. The company believed it would realistically be able to resolve its long-term financing solution during April.
“The assessment is that this re-phasing will not have any material impact on the company’s long-term production plan,” the company said in a statement.
Northland said it was using temporary port-terminal facilities, until the new ore terminal at Narvik, was operational.
The company said it planned to produce 1.5-million dry tons of iron-ore this year, ramping up to production capacity of four-million dry tons of iron-ore a year in 2014. As at Thursday, the company had produced more than 123 000 t of iron-ore concentrate.
The company was last week Friday delisted from the TSX, but maintains a listing on the Oslo Stock Exchange.
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