JOHANNESBURG (miningweekly.com) – Dual-listed Resource Generation (Resgen) has secured R5.52-billion to complete construction of the Boikarabelo coal mine, in Limpopo.

The emerging coal miner noted on Monday that Ledjadja Coal, a subsidiary of Resgen, had agreed on the commercial terms with a financing syndicate to secure the funding.

Resgen added that the funding from FirstRand Bank, the Industrial Development Corporation, State-owned Public Investment Corporation and Noble Resources International, was expected to provide the remainder of the total funds required to complete construction of the mine and to provide the necessary headroom for contingencies.

The proposed terms of the facility include a mix of dollar and rand loans; senior, mezzanine and quasi equity; realistic tenor and market-related margins; and Noble providing a cost overrun facility, in addition to a portion of the other debt.

Credit approval and financial close is targeted for end October, with construction expected to be completed by September 2018. First saleable production is due to take place in the last quarter of 2018.

Resgen CEO Rob Lowe highlighted this as an “extremely important” milestone in the construction and commissioning of the mine, which will be the second-largest mine in the Waterberg region and will have a “marked impact” on the opening up of the Waterberg coal field.

“The support that we have received has been very pleasing. Transnet Freight Rail has also worked supportively with us to develop a viable logistics solution for the transportation of our domestic and export coal production,” said Lowe, adding that this was a major contribution towards the realisation of strategic infrastructure projects under the National Infrastructure Plan, as it allows for the unlocking of the northern mineral belt using the Waterberg as a catalyst.

Resgen noted that it had also held discussions with the Export Finance and Insurance Corporation (Efic) with a view to have Efic join the financing syndicate.

Resgen has already started with its due diligence on the project.