Photo by: Bloomberg
PERTH (miningweekly.com) – Copper developer CuDeco has secured a $3-million investment from its cornerstone investors, who have also called for the resignation of director Wayne McCrea.
CuDeco on Friday lifted a trading halt, revealing that the company had secured short-term loans of $1-million from each of its cornerstone investors China Oceanwide International Investment, Sinosteel Equipment & Engineering and New Apex Asia Investment.
The short-term funding was granted after CuDeco shareholders failed to support a A$50-million investment from Chinese investment group Focus Sun Holdings, which would have seen the Chinese firm acquire an 18% stake in CuDeco.
The $3-million would give CuDeco some breathing room to secure longer-term funding solutions to complete the construction of the $300-million Rocklands minerals processing facility.
However, the major shareholders have urged McCrea to hand in his resignation, saying they no longer had confidence in his ability to successfully manage CuDeco’s development. The shareholders said his resignation would assist the process of negotiating a longer-term funding agreement.
Without commenting on the calls for McCrea’s resignation, CuDeco on Friday told shareholders that the company had made plans to increase its existing loan facility with the Minsheng Bank to the originally approved $100-million.
The bank has indicated that it would be prepared to consider this increase if OceanWide and Sinosteel provided letters of support to the bank. Both have indicated that they were prepared to comply.
Sinosteel had also indicated that it would accept deferred payment for the balance of contract sums owed to the company for the completion of its construction contract at the Rocklands project.
Meanwhile, CuDeco further announced cost savings of some A$500 000 a week at the Rocklands project, as the mining crew at the site had been reduced to one shift, working on a seven-day on, seven-day off roster.
While waiting for the delivery of a process plant by Sinosteel, CuDeco had stockpiled more than 2.2-million tonnes of ore to be processed, which the company said would be sufficient to meet its existing requirements.
CuDeco would not add to the current stockpile, as mining was now being done from sulphide ores, which would be subject to oxidation if stockpiled for too long, which could affect plant recoveries.
The Rocklands project includes a three-million-tonne-a-year processing plant, and will produce 480 000 t/y of copper/gold/pyrite/cobalt and magnetite concentrate at full production.