Herald announces placement for N. Sumatra zinc/lead project funding

Australian mining firm Herald Resources Limited announced on Thursday placement of 120 million shares at A$1.05 per share to raise $126 million gross.

Herald said the shares will be placed with clients of Euroz Securities Limited and would be subject to shareholders? approval

Herald also reported it had received Indicative Letter of Offer from Macquairie Bank for US$30 million convertible loan facility and is on advanced stage of negotiations for US$20 million debt funding from smelter/trading groups.

The proceed from placement, together with US$50 million third party funding will provide the company with maximum flexibility in the marketing of Dairi concentrates and deciding what level of hedging (if nay) is appropriate, said the company.

Herald, together with 20 percent partner PT. Aneka Tambang Tbk. is planning to develop Dairi zinc/lead project to process 1 MTPA of ore, producing 220,000 and 100,000 tonnes of zinc and lead concentrates PA. Capital costs to build the project are estimated at US$118 million. (alex)