Resource Generation has signed a further extension of the facility arrangement under which Noble Resources International has agreed to make available additional funds. Noble Resources International has agreed to make available additional funds of up to US$3.8 million to the company's subsidiary, Ledjadja Coal to fund the operations and development of the Boikarabelo mine project being undertaken in South Africa whilst project funding is secured.
The total facility made available to the company is now $32.2 million.
The additional funds are to be made available on the same terms as the existing facility and can be drawn in monthly tranches over the period to 31 March 2018.
Key terms associated with the extension of the facility include:
- The additional funds together with the existing fully drawn facility of $28.4 million are unsecured and subject to a parent company guarantee of Ledjadja Coal ’s obligations under the agreement;
- Interest accrues at 10.75% pa and can be capitalised on a six-monthly basis unless the borrower elects otherwise to pay such interest; and
- The initial facility of $20 million is repayable in installments commencing from 30 April 2018 with a termination date of 10 September 2024, however the additional funds made available under the extension of the facility ($12.2 million) are repayable
Boikarabelo coal mine
The Boikarabelo coal resource stands at 995 Mt.
Annual production is planned at 6 Mt of high-quality product coal, which will supply local and global customers.
Boikarabelo will be connected to an existing rail system that will allow access to domestic markets and the coal terminals of Richards Bay for export shipments by means of a 44 km rail loop and link, which will be constructed.
It has a 3.452 billion tonne resource with probable reserves of 267.1 million tons on 25% of the tenements under management.
Export and domestic offtake contracts are in place for the mine’s full production for its first seven years and for a significant proportion for the following 30 years.
The Boikarabelo coal seam is between 20 and 30 m below the surface with an overburden strip ratio of 0.97:1, enabling low-cost and open-cut mining.
The seam is between 120 and 130 m thick with zones of varying quality thermal and soft coking coal.
The mine design has been completed and focuses on minimising initial capital and operating cost through clever and efficient pit design and planning.
The mining operation is planned as an open-pit terrace mining operation on multiple benches linked to a common ramp.
Feature image credit: Resgen