PERTH (miningweekly.com) – ASX-listed Highfield Resources has secured credit approvals from a syndicate of four international finance institutions for up to €320.6-million of senior secured project financing facilities to fund the development of the Muga potash project, in Spain.
The senior facilities will comprise a €300-million senior debt facility to fund the construction and development of the project, and a €20.6-million cost overrun debt facility to be used, if required, in the construction and development of the project.
The term of the senior debt facility will be ten years and the term of the cost overrun debt facility will be five years. Closing of the senior facilities is subject to customary conditions, including the negotiation and settlement of definitive documentation.
"We are delighted to announce the credit approval of €320.6-million debt facilities from BNP Paribas, ING, Natixis CIB and Societe Generale. This milestone represents the conclusion of an intensive and extensive due diligence process which included site visits by the mandated lead arrangers and independent experts conducting environmental, social, technical, marketing and legal evaluations of the project,” said Highfield CEO Ignacio Salazar.
“With the preliminary works around the mine-gate getting finalised, securing project finance was an essential step to move the construction of the project forward.”
An updated feasibility study into the Muga-Vipasca potash project estimated a capital cost to develop the project of €607-million. Over its 30-year mine life, the project is expected to produce 27.5-million tonnes of muriate of potash, with Phase 1 of the operation producing 500 000 t/y and Phase 2 increasing production to one-million tonnes a year.