PERTH (miningweekly.com) – ASX-listed Blackthorn Resources has secured an additional $80-million in equity funding from joint venture (JV) partner Glencore to complete the construction and commissioning of its Perkoa zinc project, in Burkina Faso.
Earlier this year, Blackthorn announced that the price tag on the Perkoa project had increased to some $260-million, following a revised cost estimate by Glencore.
To date, the JV partner had provided some $140-million in funding for the project, including $50-million in direct project equity, $70-million in project loans, and $20-million in working capital facilities.
Blackthorn said on Wednesday that the additional $80-million funding would be used to cover the increased construction and commissioning costs, and to cover working capital and additional capital requirements until the end of this calendar year.
Meanwhile, Blackthorn had also taken the decision not to fund its $35-million share of the capital requirement, but was instead undertaking a strategic sell-down of its interest in the project from 39.9% to 27.3%.
“We are extremely please to have reached this position with our JV partner Glencore in a prompt and commercial fashion,” said Blackthorn MD Scott Lowe.
“The terms on which Blackthorn Resources’ economic interest in the Perkoa JV will be adjusted through the strategic sell-down or dilution reflects an agreed fair market valuation of what is a high-quality near-production zinc/lead/silver asset,” he added.
Lowe noted that, over the past year and a half, the exploration success Blackthorn had enjoyed at the Mumbwa copper/gold project has resulted in that project becoming the company’s flagship asset.
“The capital raising we undertook last year was designed to allow us to accelerate our study work and ongoing exploration around this exciting copper project.
“The commercial outcome we have reached with Glencore will allow us to continue to develop the Mumbwa project while we maintain a meaningful equity position in the Perkoa project. For a company of Blackthorn’s size and profile, we believe this is an appropriate balance to maintain.”