PERTH (miningweekly.com) – ASX-listed Heron Resources has started a strategic process for its Woodlawn zinc/copper project, in New South Wales, to explore various options for the mine, including refinancing, joint venture and either a partial or complete divestment.
Operations at Woodlawn were suspended in March this year at the emergence of the Covid-19 pandemic, as travel restrictions came into effect and the company moved to safeguard its financial position.
“It has been a challenging time for Heron since taking the difficult, but right decision to suspend operations at Woodlawn in March this year, and we acknowledge the patience and support of our creditors during this period,” said CEO Tim Dobson on Friday.
In support of the strategic process, the company has received a further 12-month extension of its senior facilities waivers, until August 2021, subject to a number of conditions, including the continuation of the strategic process and Heron implementing recommendations of the strategic process committee.
“It is pleasing that Heron’s key stakeholders have agreed to provide a clear runway and financial support to execute the strategic process over the next 12 months,” said Dobson.
He told shareholders that the company believed there was inherent value in the Woodlawn project, and that the primary objective of the strategic process would be to maximise the value for all stakeholders.
Woodlawn will remain on care and maintenance until the strategic process concludes, or as Heron and its stakeholders agree upon.
Heron on Friday announced that to support the strategic process, the company has secured a A$3.5-million debt facility from Castlelake, which will be funded in a single tranche. The loan will have an interest rate of 15% a year and will mature at the earlier of 12 months after execution or the end of the strategic process.
Repayment from the loan will be made from any proceeds from the strategic process.