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Tiger Resources Limited - Kipoi Project - Development Funding Update
Tiger Resources Limited - Kipoi Project - Development Funding Update
About this update from Alaska Hydro Corp.
[{"type":"text","content":"\n\n\n\nSep. 16, 2009 (Canada NewsWire Group) -- PERTH, Western Australia, Sept. 15 /CNW/ -- Tiger Resources Limited (ASX / TSX: TGS) (\"the Company\") is pleased to report that significant progress has been made towards securing funding for the development of the proposed US$30 million Stage 1 copper mining operation at the Kipoi project.Highlights- Mandate of leading South African bank to arrange US$16 million debtfacility.- Receipt of indicative proposals for offtake arrangements inconjunction with subordinated debt facility for up to US$15 million.- Continuing to target commencement of production for mid 2010.- Potential for significantly enhanced project economics as a result ofincreased copper price (refer Table 1).Development FundingThe proposed Stage 1 development at the Kipoi project comprises a heavy media separation (HMS) and spirals plant treating 900,000 tpa of high grade oxide and transition ores and producing approximately 116,000 tonnes of contained copper in concentrate over a period of approximately three years. Capital expenditure for this development estimated by Arccon Mining Services in the Revised Definitive Feasibility Study (\"RDFS\") is approximately US$30 million. The Company is planning for this to be primarily funded by a package of principal and subordinated debt given the short payback period (refer Table 1 below).Principal Debt ComponentThe Company has mandated Nedbank Capital (the Investment Banking Business of Nedbank Group Limited) (\"Nedbank\"), to act as exclusive arranger of an Export Credit Insurance Corporation of South Africa Limited (\"ECIC\") supported debt facility, for use in the Stage 1 development at the Kipoi project. Nedbank is one of the four largest banking groups in South Africa. The ECIC scheme facilitates and encourages South African export trade by underwriting bank loans and investments outside South Africa.Key indicative terms of the proposed debt facility include:- Facility amount of US$16 million.- Floating interest rate of LIBOR plus 2.5%.- Facility includes comprehensive commercial and political riskinsurance policies (terms and fees to be agreed with ECIC).- Facility will include hedging requirement. Quantity of copper to behedged dependent on hedge price. At a hedge price of US$1.80/lbapproximately 10% of total production is required to be hedged(quantity reduces as ...