PERTH (miningweekly.com) – Dual-listed Coalspur has secured a senior debt facility for up to $350-million to fund the majority of the development for the company’s $445-million Vista coal project, in Canada.
The miner said on Thursday that the facility gave Coalspur access to funding, allowing the company to maintain its development schedule.
Construction was expected to start shortly after regulatory approval was obtained, with Stage 1 of the project producing some three-million tons a year of clean coal, starting in 2015.
“Coalspur has achieved a major milestone in entering into these agreements for the majority of funding for the first stage of Vista,” said CEO and president Gill Winckler.
“The increased level of the facility, as well as the flexibility that has been afforded the company by EIG Global Energy Partners, reflects their belief in Vista. EIG is an astute investment group with an excellent track record and their support for Vista, along with the continued support of our major shareholder, Borrowdale Park, will enable us to begin construction activities, as planned, in the coming months.”
Winckler noted that the company was in the final stages of its regulatory approvals process for the Vista project, and remained on schedule to move into construction shortly after a shareholders meeting to vote on the funding arrangement.
“It is expected that shareholders will be asked to approve these funding arrangements in June,” he said.
The debt facility would have a maturity date of eight years, and would have an interest rate of 8% a year in cash, as well as 3% a year which could be capitalized or paid in cash.
Subject to TSX and shareholder approval, EIG’s investment fund would be granted 120-million warrants with an exercise price of 55c each. These warrants would expire on the maturity date of the facility, or earlier, in certain circumstances.