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Petropavlovsk reports strong interest in bond offering

20th June 2019

By: Creamer Media Reporter

     

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Russian gold mining company Petropavlovsk on Thursday announced a new $125-million convertible bond to refinance an existing short-term $100-million bond with a coupon of 9%, using a long-dated instrument at a lower cost.

CEO Pavel Maslovskiy said in a statement that the new bond offering had been met with strong interest by the market, resulting in a “significantly oversubscribed book of demand from a range of investors”.

“The net proceeds from the issue of the bonds, after the buyback and any additional redemptions of the outstanding convertible bond have been completed, will be used to advance construction of a new flotation facility at the Pioneer mine, enabling us to grow our production by unlocking the value embedded in our refractory reserves via the pressure oxidation, or POX hub," he said.

The $25-million to $30-million Pioneer mine would comprise two flotation lines resulting in a total processing capacity of 3.6-million tonnes a year, with commissioning taking place in the fourth quarter of next year.

Once operational, Pioneer would supply refractory gold concentrate for processing into gold doré at the POX on the site of the former Pokrovskiy mine.

The company stated that the construction of a new flotation plant at Pioneer was a significant step towards unlocking the value of refractory gold at Pioneer, where 80% and 65%, respectively, of openpit and underground reserves are refractory.

Edited by Mariaan Webb
Creamer Media Senior Deputy Editor Online

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