Kingsrose gets US$15m from Credit Suisse for Talang Santo
Tuesday, February 12 2013 - 02:25 AM WIB
ASX-listed Kingsrose Mining Limited recently stated that Credit Suisse is extending its support for the company?s Way Linggo Project by agreeing to provide US$15 million in funding to accelerate the production ramp-up at the Talang Santo mine.
"The funds will be used to expedite mine development at Talang Santo once the Indonesian Mines Department has provided final permission for full mining activities to recommence. This is anticipated to occur next month. Some of the funds will go towards drilling to further define and expand the Talang Santo resource, test nearby targets and for general working capital purposes. (We) do not anticipate requiring any further funding for the Way Linggo Project," the company sid in a statement made available at the exchange.
The funding will be provided via a two-part prepaid gold transaction to PT Natarang Mining (NM), an 85% owned subsidiary of Kingsrose and operator of the Way Linggo Project, which includes Talang Santo.
?This funding will allow us to ramp up production at Talang Santo as quickly as possible and ensure that the Project generates maximum income for both Kingsrose shareholders and for lndonesia, particularly for the people of Lampung Province, Sumatra,? Kingsrose Managing Director Chris Start said, adding that the financing was a vote of confidence from Credit Suisse in the Way Linggo Project.
The pre-paid transaction essentially involves NM delivering specified quantities of gold ounces (determined upon trade execution) on a monthly basis starting in January 2014 and ending in July 2015.
Credit Suisse will pay the sales proceeds to NM at the time of trade execution of each of the two tranches; the first tranche of US$4 million will be executed on completion of the transaction documentation, expected to occur this month; and the second tranche of US$11 million will be executed upon permission being given to resume full mining activities at Talang Santo, including receipt of a forestry ?borrow & use? permit, and review by Credit Suisse of an updated cash forecast.
Editing by Er Audy Zandri