AIM-quoted BlueRock Diamonds and its subsidiary Kareevlei Mining have entered into an asset finance facility of up to £310 000 with Mark Poole, a substantial shareholder.The loan facility will be used to by BlueRock Diamonds to purchase essential equipment for the efficient and cost effective operation of the mine.
The loan facility carries an interest rate of 10% over a five-year term, repayable in 19 equal quarterly instalments following an initial three-month interest free period.
[quote]The loan facility is unsecured but it carries the right for the purchase of the capital goods acquired, utilising the loan facility for ZAR 1 in the event of the company's default.
Separately, BlueRock Diamonds has been notified that each of Tim Leslie, Mark Poole and Segar Properties, a company wholly owned by Paul Beck, intend to extend the maturity date of the six-month loan facility of up to £150 000 entered into on 15 March 2017 from the current maturity date of 15 September 2017 such that it will now mature on 31 December 2017.
Furthermore it is intended that each of Tim Leslie and Segar Properties will each provide a further £20 000 such that the total March loan facility will increase to up to £190 000.
BlueRock Diamonds is currently exploring options for providing additional financing in order to fund its operations while it further develops the Kareevlei mine.
In particular, BlueRock Diamonds expects to carry out the final blast of upper level Kimberlite in early August 2017, prior to starting to mine deeper levels of the pit which, test results indicate are likely to deliver higher grades than those currently being experienced, which should allow the mine to move into operational profitability.
Production, using BlueRock Diamonds’ reconfigured plant, continues to progress positively with ongoing operation at or around targeted daily tonnages.
BlueRock Diamonds looks forward to providing an update on production and diamond recovery in due course.
"The loan facility will enable us to further our aim to operate Kareevlei in the most cost effective way,” says BlueRock Diamonds CEO, Adam Waugh.
“We are currently exploring options to fund the further development of mining operations at Kareevlei, including lowering our reliance on outside contractors to deliver productivity improvements and cost savings, similar to those that we expect from the current planned equipment purchase," he concludes.