PERTH (miningweekly.com) – ASX-listed Allegiance Coal has entered into a $25-million loan term sheet with credit asset manager Nebari Natural Resources Credit Fund, which could contribute to the capital required to start up the New Elk mine, in Colorado.
The loan will have a 36-month term from the date of drawdown, with repayments starting 18 months after the drawdown.
The loan will be secured by a first ranking charge over the Allegiance group of companies, including assets related to the New Elk mine.
Allegiance said on Monday that the loan was subject to a number of conditions precedent, including the completion of a technical, legal and business due diligence, Allegiance completing the acquisition of the New Elk mine and completing key material contracts for the startup.
An updated feasibility study on the restart of New Elk estimated that $40-million in capital would be required to restart the operation, at a production rate of 1.4-million tonnes a year for a mine life of 15 years.