PERTH (miningweekly.com) – ASX-listed Bowen Coking Coal has secured a $55-million debt financing package with financier Taurus Mining Finance Fund No. 2, shortly after starting mining at its Bluff opencut mine, in Queensland.
The new debt facility contemplated by the mandated documentation is proposed to be senior secured with an aggregate limit of $55-million, and the facility will be used for capital expenditure, general working capital and expenses incurred in recommissioning the Burton coal handling and preparation plant (CHPP), developing the Burton and Broadmeadow East projects and operating the Bluff mine.
The facility is proposed to be structured as an amortisable term loan with an initial term of 18 months. Bowen Coking Coal told shareholders that the facility proposes no financial maintenance covenants, thereby giving the company financial flexibility as it ramps up production across its development assets.
The facility is proposed to have a coupon rate of 8%, royalties in relation to the sale of coal production from Bluff and the Burton complex and establishment fees customary for a facility of this nature.
“The new debt facility will provide Bowen Coking Coal with an expedited pathway to develop its northern Bowen basin coking coal assets, including the Burton complex, following the successful commencement of mining at Bluff earlier this month,” said executive chairperson Nick Jorss.
“The funding to refurbish the CHPP will allow us to unlock significant value at the Burton mine which we are in the process of acquiring for a near-term startup. The centralised CHPP will have total processing capacity of up to five-million tonnes per annum and will provide us with an ideal location to wash coal from our other nearby coking coal projects.
“Taurus has a strong track record of supporting miners in the Bowen basin and we welcome them as financing partners for Bowen’s exciting projects.”
Completion of the financing is subject to final credit approval inclusive of satisfaction of material commercial conditions precedent and completion of detailed documentation.