Resgen evaluates contractor mining as means to lower Boikarabelo costs
South-Africa focused Resgen, which is developing the Boikarabelo coal mine, is seeking quotations from mining contractors as it considers whether a contract-mining model will lower the mine’s costs and capital requirements.
The evaluation of the contract-mining model was requested by a club of financiers with which the ASX-listed company has been negotiating a potential multi- layered funding package. The financiers are hoping that the adoption of a contract-mining model will lower gearing levels.
Resgen pointed out last week that the finalisation of negotiations had been hampered by a weakened API4 coal price forecast. Resgen had been trying to secure $400-million in financing to complete the mine construction and related infrastructure for the past three years.
“The aim has been to fund construction through debt to avoid issuing additional equity and diluting shareholders’ interest in the project. This has proved to be difficult due to changing macroeconomic factors resulting in changes to the financiers’ requirements,” the company said in a statement.
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