PERTH (miningweekly.com) – Dual-listed coal developer Resource Generation (Resgen) has inked a binding agreement for the funding of its Boikarabelo coal mine, in South Africa.
“The transition of the non-binding term sheets into legal agreements is a most important milestone,” said Resgen interim MD and CEO Leapeetswe Molotsane.
The company earlier this week entered into two nonbinding term sheets for equity and debt, shortly after reaching an agreement with Noble Resources to provide up to $2.5-million in additional working capital.
“Subject only to satisfactory completion of the conditions precedent, funding for the construction of the remainder of the mine is now assured. The agreements are the product of a lot of hard work and we are grateful for the drive and commitment of the lending syndicate and the professional advisers on both sides of the transaction in converting the agreed indicative funding terms into full form binding agreements,” Molotsane said.
Resgen will now schedule an extraordinary general meeting for the first quarter of 2020 to allow shareholders to vote on the agreements with the lending syndicate, with an independent adviser having been appointed to report on the funding agreements.
In the meantime, Resgen will continue to work on the satisfaction, deferral or waiver of the conditions precedent under the project funding agreement.
The Boikarabelo project is estimated to host a resource of some 995-million tonnes, and is expected to produce at a rate of six-million tonnes a year of high quality coal. Export and domestic offtake contracts are already in place for the project’s full production for the first seven years of operations, and for a significant portion of its 30-year mine life.