PERTH (miningweekly.com) – ASX- and TSX-V listed Jervois Global has secured a $75-million loan facility with Mercuria Energy Trading, a wholly-owned subsidiary of Mercuria Energy Group.
The finance facility will have a maturity date of the end of December 2024, with annual interest payable on amounts drawn is Libor + 5%.
Jervois said on Friday that the facility will be used to fund working capital in Finland, where the company recently closed a $160-million buy of Finland-based Freeport Cobalt.
The business has contractual rights to about 40% of the Kokkola refinery capacity, thus it can toll refine 6.25-million tons a year of cobalt at cost until 2093. It also includes a downstream cobalt products manufacturing facility.
Jervois told shareholders that owing to current cobalt prices and buoyant market expectations, Jervois expects initial utilisation of $32.5-million to occur in November 2021, subject to satisfaction of customary conditions precedent, including those related to execution of security documentation over the assets of Jervois Finland.
Future drawdown proceeds may be used to fund higher working capital levels at Jervois Finland should cobalt prices continue to increase, and where required, funding of the group’s development activities, including the R$47.5-million cash acquisition payment for SMP nickel cobalt refinery that Jervois expects to fall due in the first quarter of 2022, in line with the anticipated closing.