In addition Weatherly International has announced that debt repayments due to Orion Mine Finance Fund I LP have been rescheduled.
Investigations continue into whether or not leach rates can be accelerated to match those predicted in the 2012 Bankable Feasibility Study (BFS) by varying site operating parameters.
In the meantime, mining and stacking rates have been accelerated to compensate and production rates have improved in May and June as expected, such that full year copper production guidance is unchanged at 14 500 to 15 000 tons.
Capital construction of the stage two leach pads is underway and permanent loss of recoverable copper metal by sealing and over-stacking of partially leached ore is expected to be minimised as a result.
Weatherly International is unable to generate sufficient surplus cash at current copper prices to fund the pad construction capital plus the additional working capital required for accelerated mining and stacking of slower-leaching ore as well as all loan repayments to Orion when due.
Weatherly International believes it will need US$10 million additional funding to construct the new pads and deal with the working capital issues that have arisen from the slower leaching at Tschudi.
Orion has agreed to further amendments to the terms of its funding arrangements as described below and have also agreed to enter into a new uncommitted US$10m facility to cover the additional funding requirement, the terms for which are at an advanced stage of discussion.
Details of the new facility will be announced when it is executed.
Feature image credit: Weatherly International