Orion Minerals expects first tranche of Glencore prepayment facility to be available end-Aug
Johannesburg- and Australia-listed Orion Minerals says substantive progress has been made towards satisfying the outstanding conditions precedent related to financing and offtake agreements entered into with diversified miner Glencore earlier this year and that the first tranche of funding should become available for drawdown by the end of August.
The company, which is developing the Prieska copper/zinc mine, in South Africa's Northern Cape province, in February announced that it had entered into a $250-million prepayment facility with Glencore, with the funds payable in two tranches. The first $40-million tranche would be used to fund the construction and startup of the Uppers development at Prieska, while the $210-million tranche two payment would be used to fund the construction and startup of the Deeps development at Prieska.
Settlement of the prepayment facility will occur through the sale and delivery of bulk copper and zinc concentrates from the Prieska mine in terms of linked offtake arrangements.
Orion says that, as part of the conditions precedent, it has now received approval from the South African Reserve Bank.
Further, an intercreditor agreement to be entered into between Glencore and Triple Flag Precious Metals is in an advanced form, subject to execution, while the offtake agreements to be entered into between Orion and Glencore are also in final form and subject to execution.
"We are pleased that the conditions precedent for drawdown of Tranche A under the Glencore financing agreement are nearing satisfaction, which will allow us to move into the execution of the Uppers at Prieska. This will be a major milestone in the life of Orion, and we look forward to becoming a producer, which on the current timetable is expected to occur 13 months after Tranche A of the financing closes," says Orion MD and CEO Tony Lennox.
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