TSX-listed copper developer Nevada Copper on Wednesday announced a range of financing agreements for the construction of its underground mine at Pumpkin Hollow, in the US, including a $115-million credit agreement from Germany’s KfW IPEX-Bank.
Other financing includes a $35-million working capital facility with Concord Resources and offtake agreements with Aurubis, Aurubis Bulgaria and Concord, as well as an announcement about plans to raise $30-million in a public offering and private placement.
Funding under the KfW IPEX-Bank facility will occur following the repayment of the existing senior debt facility from Red Kite Mine Finance. By replacing the existing senior debt facility from Red Kite with bank project finance, Nevada Copper said it would significantly reduce its debt service costs, extend its senior debt maturity, and substantially enhance its financial flexibility to manage construction and ramp-up of the underground project, which would enter into production later this year.
“This substantial new financing package marks an important further step in the growth of Nevada Copper. Not only does the replacement of the existing senior debt facility with lower cost bank project finance significantly reduce the company’s cost of capital and bring in a potential partner for the future development of the openpit, the facility provided by KfW IPEX-Bank and backed by a German government loan guarantee is also a major validation of the project’s quality and the robust plan being executed by the company,” said CEO Matthew Gili.
He reported that the underground project was progressing strongly.
Gili further said that Nevada Copper would accelerate is exploration programme, both at the openpit and its newly-defined targets around surface mineralisation contained in the recently expanded land position.