Finders finalizes funding for copper project expansion

By Romel S. Gurky

ASX-listed copper producer Finders Resources Limited announced Monday it has completed funding for the expansion of its Wetar Island copper cathode plant project in Maluku Province.

The company and its subsidiary PT Batutua Tembaga Raya (BTR) have entered into a US$165 million senior project finance facility agreement with BNP Paribas, Commonwealth Bank of Australia, Hong Kong and Shanghai Banking Corporation (HSBC) and Societe Generale, Finders said in a statement.

As previously announced on 2 May 12, 2014, the facilities will consist of:
? $130 million term loan facility;
? $20 million cost overrun facility; and
? $15 million VAT working capital facility.

Finders said the facilities will have first ranking security over the Wetar Copper Project. Availability will be subject to typical conditions precedent for a facility of this nature, including raising and expanding the project equity and satisfaction of costs to completion tests, implementation of a minimum copper hedging program to support the facilities and financial covenant tests immediately prior to hedging and drawdown.

Finders also said that the signing of the $165 million project finance meets the last remaining condition precedent under Finders? Share Subscription Agreement with Daewoo International Corporation. Closing of the Daewoo investment has been scheduled for November 7. Under the Share Subscription Agreement, Daewoo will provide equity and loans of $45 million and will receive an interest of 24.1 percent in BTR.

Finders Managing Director Barry Cahill said: ?Securing funding of the project with experienced financiers such as Daewoo and our banks is a tremendous vote of confidence in the company and a testament to the strength of the Wetar project. We are very excited about working with them all to expand the Wetar project. Now the real work begins. ?

Finders started a 3,000-ton per annum copper production at Wetar on March 31, 2014. The company is planning to develop a second 25,000-ton per annum capacity plant as part of an expansion project.

Finders said it will mobilize manpower, equipment and materials for the 25,000-ton-pa plant this month. Commissioning of the expanded plant is expected by the end of 2015, it added.

Editing by Reiner Simanjuntak