JOHANNESBURG (miningweekly.com) – ASX- and JSE-listed Resource Generation (Resgen) on Thursday said construction activities at its $630-million Boikarabelo coal mine, in Limpopo, had started, in line with earlier announcements.
Initial construction activities would encompass site infrastructure, road works and water and power connections. Further geotechnical boreholes were also being drilled across the initial mining area.
The Boikarabelo mine would be developed in two phases, the first of which would deliver about 12-million tons of coal a year, which would equate to about six-million tons of product coal.
Phase 2, planned for 2018, would see production ramp up to 20-million tons of product coal.
Meanwhile, Resgen noted in a statement to shareholders that independent technical, market, legal and other consultants engaged on behalf of financiers, had completed due diligence investigations.
“Those investigations confirmed the company’s view that there are no material issues affecting the development or financing of the Boikarabelo mine. The company continues to assist the financiers with respect to enquiries arising out of their approval processes,” the company stated.
At the end of 2012, the company had awarded a mandate to six South African and global banks, as well as other financiers to provide project debt finance for the construction of the mine.
The financiers were Absa Capital, Caterpillar Financial Services, Rand Merchant Bank, Hong Kong & Shanghai Banking Corporation, Nedbank Capital and Standard Chartered Bank.
Resgen reported last month that a credit-submissible terms sheet was agreed with the financing syndicate at the end of the December 2012 quarter and that the financiers were processing their credit submissions to obtain formal credit approvals for the facility.