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Kula extends working capital facility

14th August 2014

By: Esmarie Iannucci

Creamer Media Senior Deputy Editor: Australasia

  

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PERTH (miningweekly.com) – ASX-listed Kula gold has extended its existing A$3-million working capital facility with RMB Resources by 12 months.

The company said on Thursday that the debt extension agreement provided Kula with the option to extend the due date of the facility to the end of November 2015 and also reset the mandatory repayment trigger to A$10-million in aggregate equity raisings.

“The recent grant of the mining lease, the successful rights issue of A$2.1-million and now the extension of the debt facility enables Kula to focus on adding value for shareholders by demonstrating the excellent resource potential through infill drilling and moving the project towards development,” said Kula Gold CEO Stuart Pether.

He noted that the RMB facility would be closed-out as part of a project development funding package.

Kula’s Woodlark Island project would require a capital investment of $160-million, and would have a pre-tax net present value of $237-million and an internal rate of return of 34%.

A 2012 feasibility study revealed that the Woodlark Island project had a Joint Ore Reserves Committee-compliant resource of 2.1-million ounces and an ore reserve of 766 000 oz. The project was expected to deliver 1.8-million tonnes of ore a year, over a mine life of nine years.

First production has been scheduled for the first half of 2015.

Edited by Creamer Media Reporter

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