ASX- and JSE-listed Resource Generation (Resgen) has reached an in-principle agreement with Noble Group to provide additional working capital to its partly owned subsidiary Ledjadja Coal.
The capital will be provided in the form of a further extension to the facility agreement reached in March 2014.
Resgen earlier in March announced that it was engaging with its secured creditor Noble Group for the purposes of securing access to additional working capital to finalise a strategic review of the company that was initiated in November last year.
The in-principle agreement extends the facility agreement by up to an additional $993 000, bringing the total facility to $51-million. The extension of funds will be made available in three instalments to cover an austerity operating budget for the period through to May 31.
During this period, Resgen will continue considering measures to ensure the continued solvency of the group and alternatives for progressing development of the Boikarabelo project.
Resgen is currently developing the Boikarebelo coal mine, in South Africa’s coal-rich Waterberg region.
The coal resources and reserves for the Boikarabelo mine are held through the operating subsidiary Ledjadja Coal and amount to 995-million tonnes and 267-million tonnes, respectively.
Stage 1 of the mine development targets saleable coal production of six-million tonnes a year.